Exhibit ▇▇.▇
------------
▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ LLC
Contract
SECTION 1
FORM OF AGREEMENT
FORM OF AGREEMENT
HIRE OF A DRILLING UNIT
This Contract (CONTRACT) between BP TRINIDAD AND TOBAGO LLC, a company
incorporated in the State of Delaware and registered under the Companies Act,
1995 of the Laws of the Republic of Trinidad and Tobago (hereinafter referred to
as "OPERATOR"), and ▇▇▇▇▇▇ OFFSHORE INC. a company incorporated in the State of
Delaware (hereinafter referred to as "CONTRACTOR") is to engage the CONTRACTOR
to carry out drilling services (DRILLING SERVICES) in accordance with the
following terms and conditions.
OPERATOR enters into this Contract on behalf of itself and all participants in
the concession area (CO-VENTURERS) but notwithstanding this fact or anything
else in the CONTRACT to the contrary:
(a) The CONTRACTOR agrees to look only to OPERATOR for the due performance
of the CONTRACT and nothing herein contained shall impose any liability
upon or entitle the CONTRACTOR to commence any proceedings against any
of OPERATOR'S CO-VENTURERS.
(b) OPERATOR shall be entitled to enforce the CONTRACT on behalf of its
CO-VENTURERS as well as for OPERATOR and for this purpose OPERATOR and
only OPERATOR may commence proceedings in its own name to enforce all
obligations and liabilities of the CONTRACTOR under this CONTRACT and
to make any claim which OPERATOR, its CO-VENTURERS may have against the
CONTRACTOR.
1. DOCUMENTS
The CONTRACT shall comprise the following documents:
1.1 This Contract Agreement
1.2 Conditions of Contract (section 2 hereto)
1.3 Contractor's Insurance (section 3 hereto)
1.4 Statement of Requirements (section 4 hereto)
1.5 Rates and Charges (section 5 hereto)
1.6 Contractor's Personnel (section 6 hereto)
1.7 Specification of Contractor's Equipment (section 7 hereto)
2. DEFINITIONS
In this Agreement words and expressions shall have the same meanings as
are respectively assigned to them in the Conditions of Contract.
3. THE SERVICES
The Scope of the SERVICES shall be the provision of the DRILLING UNIT
and DRILLING EQUIPMENT as more fully described in SECTION 7 hereto and
PERSONNEL as more fully described in SECTION 6 hereto and providing
services as more fully described in SECTION 4 hereto for the drilling
of ▇▇▇▇▇ as more fully described in the documents hereto.
SECTION 1
FORM OF AGREEMENT
PAGE 2 OF 5
================================================================================
4. OPERATOR'S REPRESENTATIVE
The OPERATOR'S REPRESENTATIVE shall be ▇▇▇ ▇▇▇▇▇▇▇▇, Manager, Well
Operations
BP Trinidad and Tobago LLC
5 & ▇▇ ▇▇▇▇▇'▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇ ▇▇▇▇▇
Trinidad
Tel No. ▇▇▇ ▇▇▇-▇▇▇▇
Fax No. ▇▇▇ ▇▇▇-▇▇▇▇
5. CONTRACTOR'S REPRESENTATIVE
The CONTRACTOR'S REPRESENTATIVE shall be
▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇, Vice President
▇▇▇▇▇▇ Offshore Inc.
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
6. DURATION OF THE CONTRACT
6.1 Duration
Notwithstanding the date hereof the CONTRACT shall be deemed
to have come into effect on the date that the DRILLING UNIT is
under tight tow to Pascagoula, Mississippi to begin the Make
Ready Period as further described below and shall, subject to
OPERATOR'S rights of termination hereunder, continue until the
third anniversary of the Commencement Date subject to any
extensions pursuant to Clause 6.2 of this Section 1, and
subject to extension for any period necessary to complete any
WELL being drilled upon such anniversary.
6.2 Options to Extend
The OPERATOR may, at its option, extend the term of the
CONTRACT by exercising up to two (2) one-year extensions, such
extensions to run consecutively with the preceding CONTRACT
term, subject to OPERATOR's rights of termination hereunder.
If OPERATOR elects to exercise the option for the first
one-year extension of the term of the CONTRACT, OPERATOR shall
give CONTRACTOR written notice of the exercise of such
extension option at least six (6) months prior to the third
anniversary of the Commencement Date. Upon CONTRACTOR's
receipt of such written notification, OPERATOR and CONTRACTOR
shall negotiate in good faith to determine the mutually
agreeable rates for the DRILLING UNIT that shall apply during
such one-year extension period. If OPERATOR and CONTRACTOR
reach a mutually acceptable agreement on such rates by the
date three (3) months after the date of such written notice by
OPERATOR of its exercise of the extension option, the term of
the CONTRACT shall be extended by one (1) year, and such
agreed rates shall apply in lieu of the rates previously
applicable to the CONTRACT. If OPERATOR and CONTRACTOR do not
reach a mutually acceptable agreement on such rates by the
date three (3) months after the date of such written notice by
OPERATOR of its exercise of the extension option, then there
shall be no extension of the term of this CONTRACT based on
2
SECTION 1
FORM OF AGREEMENT
PAGE 3 OF 5
================================================================================
the extension options granted to OPERATOR hereunder, and
CONTRACTOR shall be free to enter into agreements for the
utilization of the DRILLING UNIT for periods after the
expiration of the term of the CONTRACT.
If the CONTRACT term is extended by one (1) year pursuant to
the foregoing provision, then OPERATOR shall retain the option
to extend the term of the CONTRACT for the second one-year
option period. If OPERATOR elects to exercise such option for
the second one-year extension of the term of the CONTRACT,
OPERATOR shall give CONTRACTOR written notice of the exercise
of such extension option at least six (6) months prior to the
fourth anniversary of the Commencement Date. Upon CONTRACTOR's
receipt of such written notification, OPERATOR and CONTRACTOR
shall negotiate in good faith to determine the mutually
agreeable rates for the DRILLING UNIT that shall apply during
such one-year extension period. If OPERATOR and CONTRACTOR
reach a mutually acceptable agreement on such rates by the
date three (3) months after the date of such written notice by
OPERATOR of its exercise of the extension option, the term of
the CONTRACT shall be extended by one (1) year, and such
agreed rates shall apply in lieu of the rates previously
applicable to the CONTRACT. If OPERATOR and CONTRACTOR do not
reach a mutually acceptable agreement on such rates by the
date three (3) months after the date of such written notice by
OPERATOR of its exercise of the extension option, then there
shall be no extension of the term of this CONTRACT based on
the second one-year extension option granted to OPERATOR
hereunder, and CONTRACTOR shall be free to enter into
agreements for the utilization of the DRILLING UNIT for
periods after the expiration of the term of the CONTRACT.
6.3 Make Ready Period
Upon completion of the tow of the DRILLING UNIT from the last
location in the U.S. Gulf of Mexico in Main Pass Block 300 to
Pascagoula, Mississippi, the DRILLING UNIT will undergo
certain modifications and equipment additions and changes as
set forth on the attached Schedule 6.3, at the expense of
CONTRACTOR. All cost for modifications and equipment additions
and changes as set forth on the attached Schedule 6.3 is
included in the Day Rates.
Any additions and changes requested by OPERATOR other than
those listed on the attached Schedule 6.3 shall be at
OPERATOR's expense, including the payment of the PROVISIONING
RATE for any delay in the departure of the DRILLING UNIT from
Pascagoula, Mississippi caused by such requested additions and
changes, beyond fourteen (14) days from the time the DRILLING
UNIT is jacked up dockside in Pascagoula, Mississippi.
OPERATOR and CONTRACTOR acknowledge and agree that the drill
pipe listed on the attached Schedule 6.3 is not scheduled to
arrive while the DRILLING UNIT is in Pascagoula, Mississippi,
and will be delivered to the DRILLING UNIT after it arrives in
the CONTRACT AREA. Due to the timing of the required start of
operations in CONTRACT AREA, the DRILLING UNIT must be removed
from service in the U.S. Gulf of Mexico at the end of the
current program in Main Pass Block 300, and CONTRACTOR must
make certain equipment purchase commitments.
Such Make Ready Period is anticipated to last fourteen (14)
days from the time that the DRILLING UNIT is jacked up
dockside in Pascagoula, Mississippi. If the departure of the
DRILLING UNIT is delayed beyond fourteen (14) days from the
start of such period due to the request of the OPERATOR for
additional modifications or additional changes requested by
OPERATOR, OPERATOR shall pay CONTRACTOR the PROVISIONING RATE
as stated in Section 5 of the CONTRACT for such period of
delay.
3
SECTION 1
FORM OF AGREEMENT
PAGE 4 OF 5
================================================================================
6. RIG AUDIT
OPERATOR shall carry out an audit of the DRILLING UNIT in
Pascagoula, Mississippi. CONTRACTOR shall be required to
correct any deficiencies identified during the audit, at its
own costs and expenses, prior to the COMMENCEMENT DATE or as
otherwise agreed between CONTRACTOR and OPERATOR. All DRILLING
UNIT audit recommendations which would affect safe and
efficient operations must have been carried out or the
OPERATOR's REPRESENTATIVE and CONTRACTOR'S REPRESENTATIVE must
have mutually agreed in writing to a schedule for completion of
outstanding DRILLING UNIT audit recommendations.
7. RIG ACCEPTANCE
OPERATOR shall conduct RIG ACCEPTANCE of the DRILLING UNIT
pursuant to OPERATOR's rig acceptance procedure, as soon as the
DRILLING UNIT has been pinned at the LOCATION. The period
commencing on the pinning of the DRILLING UNIT to the
completion of the RIG ACCEPTANCE exercise shall be charged at
the STANDBY RATE.
In the event that OPERATOR shall not accept the DRILLING UNIT
after the completion of the RIG ACCEPTANCE exercise, the
DRILLING UNIT will go on NIL Rate until the deficiencies
identified during the RIG ACCEPTANCE exercise have been
rectified to the satisfaction of OPERATOR.
8. REMUNERATION
In full consideration of the satisfactory performance of the Services
set out in Clause 3 hereof the CONTRACTOR shall be paid as set out in
SECTION 5 hereto. Such rates will be subject only to adjustments for
documented changes, pursuant to Section 5, clause 5.7, in CONTRACTOR'S
costs of operations in the CONTRACT AREA.
Rates of payment for any extended term, which OPERATOR elects to
exercise shall be mutually agreed upon as stated in sub-clause 6.2
above.
4
SECTION 1
FORM OF AGREEMENT
PAGE 5 OF 5
================================================================================
9. ACKNOWLEDGEMENT
Kindly confirm acceptance of the terms of this Contract by signing and
returning the attached duplicate.
For BP TRINIDAD AND TOBAGO LLC
Signed: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇ Name ▇▇▇▇▇▇ ▇▇▇▇▇
--------------------------------------- --------------------------------------------
(Block Capitals)
Position: ASSOCIATE PRESIDENT & CHAIRMAN Date 7/24/01
--------------------------------------- --------------------------------------------
Signed: /s/ ▇▇▇ ▇▇▇▇▇▇▇▇ Name ▇▇▇ ▇▇▇▇▇▇▇▇
--------------------------------------- --------------------------------------------
(Block Capitals)
Position: WELL OPERATIONS MANAGER Date 7/24/01
-------------------------------------- ---------------------------------------------
Signed: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Name ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
--------------------------------------- --------------------------------------------
(Block Capitals)
Position: MANAGER, CONTRACTS Date 7/24/01
-------------------------------------- ---------------------------------------------
We confirm our acceptance of this CONTRACT.
For ▇▇▇▇▇▇ OFFSHORE INC.
Signed: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Name ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------- --------------------------------------------
(Block Capitals)
Position: CHIEF EXECUTIVE OFFICER Date 7/24/01
-------------------------------------- ---------------------------------------------
5
SECTION 2
CONDITIONS OF CONTRACT
CONDITIONS OF CONTRACT
CONTENTS
CLAUSE 1. DEFINITIONS 2
CLAUSE 2. CARRY OUT DRILLING SERVICES 3
CLAUSE 3. TERMINATION 3
CLAUSE4. ACCESS TO LOCATIONS 5
CLAUSE 5. OPTIONAL RIGHTS OF THE OPERATOR IN THE EVENT OF
DEFAULT BY THE CONTRACTOR 5
CLAUSE 6. LIABILITIES AND INDEMNITIES 8
CLAUSE.7. CONTRACTOR'S INSURANCES 12
CLAUSE.8. TAX INFORMATION AND INDEMNITY 13
CLAUSE 9. BANKRUPTCY OR LIQUIDATION 15
CLAUSE 10. FORCE MAJEURE 15
CLAUSE 11. FREEDOM FROM LIENS 16
CLAUSE 12. CONTRACTOR TO MAINTAIN REPRESENTATION 16
CLAUSE 13. GIVING OF NOTICES AND PAYMENT OF FEES 17
CLAUSE 14. CONFIDENTIAL INFORMATION 17
CLAUSE 15. PUBLICITY 17
CLAUSE 16. ASSIGNMENT AND SUB-CONTRACTING 17
CLAUSE 17. APPLICATION OF LAWS AND REGULATIONS 18
CLAUSE 18. SERVING OF NOTICES 18
CLAUSE 19. VARIATION AND WAIVER 18
CLAUSE 20. INDEPENDENT CONTRACTOR RELATIONSHIP 19
CLAUSE 21. INFRINGEMENT OF PATENTS 19
CLAUSE 22. PERMITS AND LICENCES 19
CLAUSE 23. APPLICABLE LAW 19
CLAUSE 24. ARBITRATION 20
CLAUSE 25. EXCLUSION OF PREVIOUS CORRESPONDENCE 20
CLAUSE 26. AUDIT 20
CLAUSE 27. SEVERABILITY
SECTION 2
CONDITIONS OF CONTRACT
PAGE 2 OF 22
================================================================================
CONDITIONS OF CONTRACT
CLAUSE 1. DEFINITIONS
In the CONTRACT the following words and expressions shall
have the meanings assigned to them, except where the
context otherwise requires.
1.1 "AFFILIATE" as applied to OPERATOR shall mean and include
BP Trinidad and Tobago LLC and any company which is
directly or indirectly controlled by BP Trinidad and
Tobago LLC. "Affiliate" as applied to CONTRACTOR shall
include ▇▇▇▇▇▇ Offshore Inc. and any company, which is
directly or indirectly controlled by ▇▇▇▇▇▇ Offshore Inc.
Control means the ownership directly or indirectly of more
than fifty (50) percent of the voting rights in a company,
partnership or legal entity.
1.2 "AGENCY" means any agency, authority, department, court,
government, legislature, minister, ministry, official, or
public person (whether autonomous or not) of the Republic
of Trinidad and Tobago, the United States of America and
any other nation, state, jurisdiction, supernational
organisation or any political subdivision of the
foregoing;
1.3 "CERTIFICATION" shall mean the ABS Maltese Cross A-1 Self
Elevating Drilling Unit.
1.4 The "COMMENCEMENT DATE" shall mean the date on which the
DRILLING UNIT is pinned on the first LOCATION in the
CONTRACT AREA and the OPERATOR provided RIG ACCEPTANCE.
1.5 "COMPLETION DATE" shall mean the date when the DRILLING
UNIT has completed the last WELL and all OPERATOR'S
MATERIAL'S and SERVICE COMPANY EQUIPMENT has been
offloaded and the DRILLING UNIT has been towed to the
mutually agreed on port in Trinidad.
1.6 "CONTRACT" shall mean all those documents forming the
Contract as stated in Clause 1 of the Contract Agreement.
1.7 The "CONTRACT AREA" shall mean the OPERATOR'S concession
areas offshore the east coast of the Republic of Trinidad
and Tobago (Block 27) and any onshore area used in
association therewith, or other areas agreed between the
parties.
1.8 The "CONTRACT DEPTH" shall mean the DEPTH to which the
CONTRACTOR may be required to carry out the DRILLING
SERVICES.
1.9 The "CONTRACTOR'S EQUIPMENT" shall mean the Drilling Unit
(as hereinafter defined) together with all the drilling
and associated equipment listed in SECTION 7 Group 2
(hereinafter referred to as the "DRILLING EQUIPMENT")
together with the CONTRACTOR'S stock of spare parts.
1.10 The "CONTRACTOR'S PERSONNEL" or "its PERSONNEL" shall mean
the CONTRACTOR'S labour and supervisory personnel listed
in SECTION 6.
1.11 "CO-VENTURERS" as applied to OPERATOR shall mean any
parties to a joint venture agreement whereby the OPERATOR
undertakes to act as operator for such participants of any
Licence Block in which the CONTRACTOR may be required to
perform the DRILLING SERVICES.
2
SECTION 2
CONDITIONS OF CONTRACT
PAGE 3 OF 22
================================================================================
1.12 "DEMOBILISATION" shall mean the period of time after the
DRILLING UNIT has been moved to a mutually agreed port in
Trinidad and all of OPERATOR'S and SERVICE COMPANY's
materials have been offloaded.
1.13 "DEPTH" shall mean the depth of the hole as obtained by
measuring the drilling string with a steel tape, using as
datum the top of the Rotary Table.
1.14 The "DRILLING SERVICES" shall mean the operations as
defined in SECTION 4.
1.15 The "DRILLING UNIT" shall mean the vessel as specified in
SECTION 7 - Group 1.
1.16 "EFFECTIVE DATE" shall mean the point in time that the
DRILLING UNIT is under tight tow to Pascagoula,
Mississippi to begin the Make Ready Period.
1.17 LAW" means any treaty, statute, law, directive, by-law,
rule, order, decree, regulation, injunction, license,
permit, approval, agreement or delegated legislation in
each case of any Agency;
1.18 "LOCATION" shall mean the location of any WELL.
1.19 "MOBILISATION" shall mean the period of time from when the
DRILLING UNIT is under tight tow to Pascagoula,
Mississippi, until the Make Ready Period has been
completed, and until the COMMENCEMENT DATE.
1.20 "MONTH" shall mean a calendar month.
1.21 "OPERATOR" shall mean BP TRINIDAD AND TOBAGO LLC or any
subsidiary thereof and also any reference to "OPERATOR" in
this CONTRACT shall also include OPERATOR'S AFFILIATES and
CO-VENTURERS.
1.22 "OPERATOR'S MATERIALS" shall mean the equipment,
materials, services and supplies to be provided by the
OPERATOR.
1.23 "OPERATOR'S REPRESENTATIVE" and "CONTRACTOR'S
REPRESENTATIVE" shall mean those persons who are appointed
as such from time to time by the OPERATOR and the
CONTRACTOR respectively and whose names have been notified
in writing by the appointing party to the other party.
1.24 "RIG ACCEPTANCE" shall mean that the OPERATOR'S
REPRESENTATIVE certifies in writing on the IADC-API
Official Daily Drilling Report Form that the CONTRACTOR'S
EQUIPMENT is acceptable to commence the DRILLING SERVICES
1.25 "RIG STAFF" shall mean the Rig Manager, Assistant Rig
Manager (if any), Toolpushers, Tour Pushers (if any),
Drillers and Assistant Drillers of the CONTRACTOR'S
PERSONNEL.
1.26 The "SERVICE COMPANIES" shall mean the contractors
(including their servants and agents) hired by the
OPERATOR and providing miscellaneous services in
conjunction with the DRILLING SERVICES.
1.27 The "SUB-CONTRACTORS" shall mean the contractors approved
by the OPERATOR and hired by the CONTRACTOR for any
services in conjunction with the DRILLING SERVICES.
3
SECTION 2
CONDITIONS OF CONTRACT
PAGE 4 OF 22
================================================================================
1.28 "WELL" shall mean any OPERATOR'S well or drilling location
(as hereinafter defined) whether already drilled, or yet
to be drilled by OPERATOR in the CONTRACT AREA under the
terms and conditions of the CONTRACT.
1.29 "THIRD PARTY" shall for the avoidance of doubt, mean those
parties excluding CONTRACTOR, SERVICE COMPANIES, OPERATOR,
or SUB-CONTRACTORS.
1.30 "TRINIDAD" means the Republic of Trinidad and Tobago.
Words importing the singular only also include the plural
and vice versa where the context requires.
The headings in these CONDITIONS OF CONTRACT shall not be
deemed to be part thereof or be taken into consideration
of construction thereof or of the CONTRACT.
In the event of any conflict between this Section 2 and
any of the other Sections of this CONTRACT, the provisions
of this Section 2 shall prevail.
CLAUSE 2. CARRY OUT DRILLING SERVICES
The CONTRACTOR shall carry out the DRILLING SERVICES
according to the specifications and instructions issued
from time to time by the OPERATOR consistent with the
terms of the CONTRACT.
CLAUSE 3. TERMINATION
3.1 Termination upon Loss of or Damage to the DRILLING UNIT
i. The CONTRACT shall be terminated upon the total loss
(as hereinafter defined) of the DRILLING UNIT, as
certified by a mutually acceptable independent marine
surveyor of the calibre of ▇▇▇▇▇ ▇▇▇▇▇▇ or ▇▇▇▇▇▇▇
▇▇▇▇▇▇. The surveyor shall be retained by and at the
expense of the CONTRACTOR. Termination of the
CONTRACT shall be at the date and time of such
determination by such marine surveyor or the date of
such compromised or arranged total loss.
In the context of this sub-clause 3.1(i) "total loss"
shall mean an actual, constructive, compromised or
arranged total loss of the DRILLING UNIT.
ii. The CONTRACT shall be terminated if the DRILLING UNIT
shall suffer damage that renders it incapable of
continuing operations within one (1) month of
suffering such damage, as certified by a mutually
acceptable independent marine surveyor of the calibre
of ▇▇▇▇▇ ▇▇▇▇▇▇ or ▇▇▇▇▇▇▇ ▇▇▇▇▇▇. The surveyor shall
be retained by and at the expense of the CONTRACTOR.
Termination of the CONTRACT shall be at the date and
time of such determination by such marine surveyor.
3.2 Failure to keep CONTRACTOR'S EQUIPMENT in CERTIFICATION
OPERATOR shall have the right to terminate the CONTRACT:
(i) forthwith if the CONTRACTOR fails to comply with
the requirements of sub-clause 4.2 of SECTION 4.
4
SECTION 2
CONDITIONS OF CONTRACT
PAGE 5 OF 22
================================================================================
(ii) by giving the CONTRACTOR seven days written notice
after 10 days of expiry of CERTIFICATION if the
CONTRACTOR has not commenced action to restore
same.
(iii) by giving the CONTRACTOR seven days written notice
after 30 days of expiry of CERTIFICATION if the
DRILLING UNIT has not been re-certified.
3.3 Termination upon expiry of the Term
Subject to the termination rights of OPERATOR, this
CONTRACT shall terminate on the COMPLETION DATE, subject to
the DEMOBILISATION obligations of OPERATOR. OPERATOR shall
furnish towing vessels and related services, and pay the
MOVING RATE to move the DRILLING UNIT to the mutually
agreed port and to pay the lump-sum DEMOBILISATION CHARGE
as described herein.
The OPERATOR shall be relieved from its obligation to pay
the DEMOBILISATION CHARGE if the DRILLING UNIT is under
contract to a third party to commence work for such third
party in the waters of Trinidad and Tobago, or if a third
party is paying for mobilization of the DRILLING UNIT from
the waters of Trinidad and Tobago. In such event, the
CONTRACT shall terminate when the OPERATOR's and SERVICE
COMPANY's materials are offloaded and the DRILLING UNIT is
under tight tow to the third party location. In such event,
CONTRACTOR shall furnish towing vessels and related
services to take the DRILLING UNIT to its new location.
3.4 Termination Without Cause
Commencing six (6) months from the COMMENCEMENT DATE,
OPERATOR may terminate the CONTRACT without cause after
six (6) month's written notice to CONTRACTOR. Should
OPERATOR terminate the CONTRACT without cause, and not
pursuant to Clause 3.1 or 3.2 of hereof or the default of
the CONTRACTOR with regard to unsatisfactory performance,
failure to provide equipment, breach of CONTRACT,
requisition, liquidation or insolvency, all as described
in clause 5 hereof, or force majeure as described in
clause 10 hereof, the OPERATOR will reimburse the
CONTRACTOR as follows:
The DEMOBILIZATION CHARGE (if applicable), plus 60% of the
OPERATING RATE for the remaining balance of the term of
the CONTRACT that has not been utilised, and the
unamortized portion of the Make Ready additions and
changes described on Schedule 6.3, based on the "BP
Amortized Amount" set forth on Schedule 6.3. The CONTRACT
shall terminate upon CONTRACTOR's receipt of payment of
such amounts from OPERATOR.
For example, if OPERATOR gives written notice to
CONTRACTOR eighteen (18) months after the COMMENCEMENT
DATE that the CONTRACT will terminate twenty-four (24)
months after the COMMENCEMENT DATE, then the OPERATOR
would pay to CONTRACTOR (i) $2,800,000 for the
DEMOBILIZATION CHARGE, (ii) $15,987,000 (60% of the
OPERATING RATE of $73,000 for the then remaining 365 days
of the term of the CONTRACT), and (iii) $551,008 for
OPERATOR's share of the unamortized amount of the Make
Ready additions pursuant to Schedule 6.3 (such amounts are
exclusive of any applicable VAT payable by OPERATOR).
5
SECTION 2
CONDITIONS OF CONTRACT
PAGE 6 OF 22
================================================================================
CLAUSE 4. ACCESS TO LOCATIONS
The OPERATOR shall secure for the CONTRACTOR and its
SUB-CONTRACTORS rights of access to and from LOCATIONS.
The OPERATOR shall use its best endeavours to advise the
CONTRACTOR of any limitations, restriction or conditions,
which may affect such access, and the CONTRACTOR shall
abide by such limitations, restrictions and conditions as
aforesaid.
OPERATOR shall be responsible for selecting, marking and
clearing drilling LOCATIONS, for providing proper and
sufficient certificates, permits or permission necessary
to enter upon and operate on the LOCATIONS, and for
notifying CONTRACTOR of any impediments or hazards to
operations at each LOCATION or within the anchor pattern,
including, without limitation, any pipelines, cables,
boulders, mud filled depressions or faulty bottom
conditions in the area. OPERATOR also shall provide
CONTRACTOR with soil and sea bottom condition surveys at
each LOCATION adequate to satisfy CONTRACTOR's marine
surveyor. In the event the DRILLING UNIT is used over a
platform, all surveys to determine the structural
integrity of the platform will be the responsibility of
OPERATOR.
Should seabed conditions be unsatisfactory to properly
support or moor the DRILLING UNIT upon arrival at the
LOCATION, OPERATOR shall continue to pay CONTRACTOR the
STANDBY RATE set forth in Schedule 5.1 to Section 5 of
this CONTRACT, until seabed conditions are ultimately
remedied. All expenses associated with improvements to the
seabed and repositioning of the DRILLING UNIT at the
LOCATION shall be for OPERATOR's account.
Notwithstanding any other provision of this CONTRACT,
except in the event of CONTRACTOR'S negligence, should
there be obstructions at or within the area of the
LOCATION, including the anchor pattern, or faulty bottom
conditions, which have not been identified by OPERATOR and
these obstructions or faulty bottom conditions damage
CONTRACTOR'S EQUIPMENT, or CONTRACTOR'S EQUIPMENT damages
these obstructions, or if seabed conditions prove
unsatisfactory to properly support or moor the DRILLING
UNIT during operations hereunder, OPERATOR will be
responsible for and indemnify and hold harmless CONTRACTOR
for all resulting damages, including, without limitation,
payment of the STANDBY RATE during required repairs, but
OPERATOR will receive credit for any physical damage
insurance proceeds received by CONTRACTOR as a result of
any damage to the DRILLING UNIT
CLAUSE 5. OPTIONAL RIGHTS OF THE OPERATOR IN THE EVENT OF DEFAULT BY
THE CONTRACTOR
5.1 Unsatisfactory performance by the CONTRACTOR
In the event that the OPERATOR is dissatisfied with the
performance of the CONTRACTOR hereunder on account of
sustained, unreasonably slow progress or for demonstrated
incompetency as a result of causes reasonably within the
CONTRACTOR'S control, including, without limitation, time
lost from lack of crews, stores, or poorly maintained
equipment, or failure to observe safe operating practices,
the OPERATOR shall notify the CONTRACTOR in writing with
specificity as to the cause of its dissatisfaction. Should
the CONTRACTOR fail to demonstrate to the OPERATOR'S
satisfaction that it has taken measures to remedy the
matters so specified within a period of not more than
seven (7) days, the OPERATOR shall have the right to
terminate the CONTRACT upon completion of the current
operation then being performed at the time of receipt of
the notification of dissatisfaction as aforesaid. In the
case of events requiring replacement of parts or
equipment, CONTRACTOR shall be allowed a reasonable time
6
SECTION 2
CONDITIONS OF CONTRACT
PAGE 7 OF 22
================================================================================
for transit of materials and clearances through customs,
subject to OPERATOR's payment obligations pursuant to
Clause 5.3 of Section 5. No further payments shall be due
to the CONTRACTOR other than those outstanding for work
done prior to the said termination and the DEMOBILISATION
CHARGE.
5.2 CONTRACTOR'S failure to perform its obligations or to
provide the CONTRACTOR'S EQUIPMENT
In the event of the CONTRACTOR'S continuous failure to
perform any of its obligations or to provide any of the
CONTRACTOR'S EQUIPMENT or in the event that the CONTRACTOR
fails to demonstrate that the CONTRACTOR'S EQUIPMENT is
capable of meeting the manufacturer's rating for such
equipment for sustained operations, in each case so as to
jeopardize the integrity of the well bore or which results
in unreasonably slow progress, the OPERATOR shall notify
the CONTRACTOR in writing specifying the deficiencies of
CONTRACTOR's performance or such CONTRACTOR'S EQUIPMENT
which the CONTRACTOR has so failed to provide or for which
CONTRACTOR has failed to demonstrate that such
CONTRACTOR'S EQUIPMENT is capable of meeting the
manufacturer's rating for such equipment for sustained
operations, and immediately thereafter the OPERATOR shall
have the right to exercise one of the following options:-
(a) To shutdown such operations until such time as the
CONTRACTOR shall have made good the deficiencies in
the said equipment whether as to provision or to
performance.
For any such period of shutdown the OPERATOR shall
pay the CONTRACTOR:
(i) at the REPAIR RATE in accordance with
SECTION 5 hereof provided the shutdown is
due to an abnormal failure of a component of
CONTRACTOR'S EQUIPMENT. An abnormal failure
is defined as being a failure, which is not
due to a lack of proper maintenance, by the
CONTRACTOR.
(ii) at NIL rate if the shutdown is due to lack
of proper maintenance by the CONTRACTOR.
In all such instances referred to in (i) and (ii)
above the OPERATOR shall have the exclusive right
to terminate the CONTRACT any time after a shutdown
period has exceeded twenty-one (21) days.
In such event the OPERATOR shall not be liable for
any further payments to the CONTRACTOR, other than
those outstanding for work done prior to the said
termination and the DEMOBILISATION CHARGE.
(b) To hire from the nearest available source
satisfactory to the OPERATOR all such equipment as
may be required to complete essential operations:
(i) arising out of the CONTRACTOR'S failure so
to provide the DRILLING EQUIPMENT or any
part thereof, until the CONTRACTOR shall
have provided as aforesaid, or
(ii) arising out of any sustained failure of the
DRILLING EQUIPMENT or any part thereof that
CONTRACTOR cannot demonstrate that it can
meet manufacturer's specifications for
sustained operations, until the CONTRACTOR
7
SECTION 2
CONDITIONS OF CONTRACT
PAGE 8 OF 22
================================================================================
can demonstrate to the OPERATOR that the
said equipment or part thereof can meet the
said manufacturer's specifications for
sustained operations.
All costs incurred by the OPERATOR in hiring
and transporting such equipment shall be a
debt due to the OPERATOR from the CONTRACTOR
and shall be deducted from any monies due to
the CONTRACTOR from the OPERATOR.
5.3 Breach of the CONTRACT by the CONTRACTOR
Subject to other provisions in the CONTRACT, in the event
of a material breach by the CONTRACTOR of any of the terms
and conditions of the CONTRACT, the OPERATOR shall have
the right to give written notice to the CONTRACTOR
specifying such breach and calling upon the CONTRACTOR to
remedy the breach forthwith and the CONTRACTOR shall not
be entitled to payment for work performed in making good
the breach. If after receipt of such notice the CONTRACTOR
does not remedy such breach within a reasonable period
(which period the OPERATOR shall advise in the aforesaid
written notice and which shall take into account the
nature of the breach), but in no event less than ten (10)
days, then the OPERATOR may at its own option adopt one of
the following provisions:
(i) terminate the CONTRACT as soon as is practicable
on expiry of the said period. After such
termination the OPERATOR shall not be liable for
any payments to the CONTRACTOR other than those
outstanding for work done prior to the said
termination and the DEMOBILISATION CHARGE.
(ii) in the event the OPERATOR does not wish to
terminate pursuant to (i) above, OPERATOR may
instruct the CONTRACTOR to shut down the
CONTRACTOR'S EQUIPMENT and the OPERATOR shall pay
the CONTRACTOR at SHUTDOWN WITH CREW RATE for
such period as OPERATOR requires from the date of
such shutdown and thereafter apply the provisions
of (i) of this sub-clause.
CLAUSE 6. LIABILITIES AND INDEMNITIES
6.1 The CONTRACTOR'S EQUIPMENT
(a) The CONTRACTOR shall indemnify the OPERATOR and the
SERVICE COMPANIES and hold the OPERATOR and the
SERVICE COMPANIES harmless from and against any and
all liability for loss, damage or destruction of
the CONTRACTOR'S EQUIPMENT whether arising out of
the CONTRACT or in tort, and against all claims,
demands, proceedings and causes of action resulting
therefrom, regardless of how such loss, damage or
destruction occurs, notwithstanding that such loss
or damage as aforesaid may have been due to the
negligence of the OPERATOR or its SERVICE COMPANIES
and its or their personnel or agents excepting only
CONTRACTOR's EQUIPMENT below the rotary table as
stated in sub-clause 6.1(b) below.
(b) The OPERATOR shall assume liability at all times
during the DRILLING SERVICES for loss of or damage
to the CONTRACTOR'S equipment below the rotary
table except fair wear and tear. Notwithstanding
anything in the CONTRACT to the contrary, the
OPERATOR shall reimburse the CONTRACTOR for the
replacement cost less depreciation of any such
equipment so lost, and in respect of equipment so
damaged whichever shall be the lesser of the
8
SECTION 2
CONDITIONS OF CONTRACT
PAGE 9 OF 22
================================================================================
replacement on-site cost less depreciation or the
repair cost, provided that such equipment and the
operation during which or as a result of which the
said equipment has been lost or damaged as
aforesaid has been approved by the OPERATOR'S
REPRESENTATIVE prior to such operation and unless
such loss or damage is due to the negligence and/or
default of the CONTRACTOR, its SUB-CONTRACTORS or
the PERSONNEL or agents of the CONTRACTOR in
conducting the operation at that time.
Depreciation shall be calculated monthly from the
original purchase date and price at one (1) percent
per month, but not to exceed 50% of the current
replacement cost. Reimbursement shall be reduced by
any amount recovered by CONTRACTOR through
insurance, which CONTRACTOR shall diligently seek
to recover.
6.2 The OPERATOR'S MATERIALS
(a) The CONTRACTOR shall take all reasonable
precautions (including but not limited to the
making out of loading notes) to protect and save
from loss or damage items of the OPERATOR'S
MATERIALS and materials of the SERVICE COMPANIES
while in the custody of the CONTRACTOR. Subject to
sub clause 6.2(b) below when no longer required for
operations hereunder the CONTRACTOR shall return to
the OPERATOR after use such of the said OPERATOR'S
MATERIALS as have not been properly consumed, in
the same condition as when handed to the CONTRACTOR
fair wear and tear excepted.
(b) The CONTRACTOR shall not be liable to the OPERATOR
for any loss of or damage to items of the
OPERATOR'S MATERIALS except that caused by the
negligence or default of the CONTRACTOR its
personnel or agents or the SUB-CONTRACTORS or their
personnel or agents, while in the custody of the
CONTRACTOR.
6.3 Personnel and Property
(a) Subject always to subclauses 6.5(a), 6.5(b)(ii) and
(iii), and 6.5(c), the CONTRACTOR shall indemnify
the OPERATOR and hold the OPERATOR harmless from
and against any and all liability for sickness,
injury or death of any THIRD PARTY person or the
loss of or damage to any THIRD PARTY property and
against all claims, demands, proceedings and causes
of action resulting therefrom due to any negligent
act or default on the part of the CONTRACTOR, its
SUB-CONTRACTORS or its or their personnel or agents
in the performance of any of its obligations
hereunder or otherwise arising in connection with
the CONTRACT.
(b) The CONTRACTOR shall indemnify the OPERATOR and the
SERVICE COMPANIES and hold the OPERATOR and the
SERVICE COMPANIES harmless from and against any and
all liability for loss of or damage to property of
or in the possession and control of the
CONTRACTOR'S PERSONNEL and SUB-CONTRACTOR'S
personnel and against any and all liability for
sickness, injury or death to any of the
CONTRACTOR'S PERSONNEL and SUB-CONTRACTOR'S
personnel arising out of the CONTRACT or in tort
and against all claims, demands, proceedings and
causes of action resulting therefrom
notwithstanding that such loss or damage to such
property or sickness, injury or death to the
personnel as aforesaid may have been due to the
negligence or default of the OPERATOR or its
personnel or agents or the SERVICE COMPANIES or
their personnel or agents.
9
SECTION 2
CONDITIONS OF CONTRACT
PAGE 3 OF 22
================================================================================
(c) The OPERATOR shall indemnify the CONTRACTOR and
hold the CONTRACTOR harmless from and against any
and all liability for loss of or damage to property
of or in the possession and control of the
OPERATOR'S personnel or SERVICE COMPANY personnel
and against any and all liability for sickness,
injury, or death to any of the OPERATOR'S personnel
or SERVICE COMPANY personnel arising out of the
CONTRACT or in tort and against all claims,
demands, proceedings and causes of action resulting
therefrom notwithstanding that such loss or damage
to such property or sickness, injury or death to
the personnel as aforesaid may have been due to the
negligence or default of the CONTRACTOR or its
PERSONNEL or agents or the SUB-CONTRACTORS or their
personnel or agents or the SERVICE COMPANIES or
their personnel or agents..
(d) The OPERATOR shall indemnify the CONTRACTOR and
hold the CONTRACTOR harmless from and against any
and all liability for sickness, injury or death of
any THIRD PARTY person or the loss of or damage to
any THIRD PARTY property and against all claims,
demands, proceedings and causes of action resulting
therefrom due to any negligent act or default on
the part of the OPERATOR, its SERVICE COMPANIES, or
its or their personnel or agents in the performance
of any of its obligations hereunder or otherwise
arising in connection with the CONTRACT.
6.4 Loss of or Damage to the Hole
In the event that the hole should be lost or damaged
arising out of operations hereunder due to the negligence
of the CONTRACTOR, its personnel or agents then the
OPERATOR may instruct the CONTRACTOR either to drill a new
hole to the depth at which the said loss or damage
occurred or to re-drill such section of the damaged hole
in both instances at the REDRILLING RATE and in accordance
with the terms of the CONTRACT. Except for the foregoing
obligation of CONTRACTOR, and notwithstanding anything
else in this CONTRACT to the contrary, CONTRACTOR shall
not be liable for damage to or loss of the WELL.
6.5 Underground Damage and Control of Blowout and Pollution
(a) Reservoir Damage
Notwithstanding anything in the CONTRACT to the
contrary, the OPERATOR shall indemnify and hold the
CONTRACTOR harmless against any damage to or
destruction of or loss or impairment of any
property right in or to oil, gas or other mineral
substance or water if at the time of the act or
omission causing such damage, destruction, loss or
impairment the said substance had not been reduced
to physical possession above the surface of the
sea-bed, and for any loss or damage to any
formation strata or reservoir beneath the seabed
resulting from operations under the CONTRACT. The
CONTRACTOR shall not make any payment due hereunder
without prior approval from the OPERATOR.
(b) Pollution
(i) Notwithstanding anything in the CONTRACT to
the contrary, the CONTRACTOR shall assume
all responsibility for, including control
and removal of, and hold the OPERATOR
harmless from, loss or damage originating
from the DRILLING UNIT arising from
pollution or contamination from, by way of
example, spills of fuels, drilling fluids
10
SECTION 2
CONDITIONS OF CONTRACT
PAGE 11 OF 22
================================================================================
(except as provide for under Clause 6.5
(b)(iii), lubricants, motor oils, pipe dope,
paints, solvents, ballast, bilge and garbage
wholly in the CONTRACTOR'S or its
SUB-CONTRACTOR'S possession and control.
(ii) Except as provided in (i) of this
sub-clause, and notwithstanding anything in
the CONTRACT to the contrary, the OPERATOR
shall assume all responsibility for
pollution, including control and removal of
pollution or contamination, which may result
from fire, blowout, cratering, seepage, or
any other uncontrolled flow of oil, gas,
wastes or other substance from any WELL
arising out of the CONTRACT, or which may
emanate from any platform, pipeline or other
equipment or facility owned or operated by
the OPERATOR, and the OPERATOR shall
indemnify and hold harmless the CONTRACTOR
from and against any and all claims,
demands, proceedings and causes of action
from any party under this CONTRACT or any
THIRD PARTY (including, without limitation,
any AGENCY) resulting from or connected with
the above.
(iii) The OPERATOR shall further assume all
responsibility for any pollution or
contamination arising from the use or
disposal of oil emulsion, oil based or
chemically treated drilling fluids,
contaminated cuttings and cavings, lost
circulation materials and fluids as well as
the furnishing, transportation and disposal
or containerisation of any materials when
such are required unless caused by the
negligence of the CONTRACTOR, or its
SUB-CONTRACTORS or its or their personnel or
agents.
(iv) The CONTRACTOR shall immediately notify the
OPERATOR of all instances of pollution
arising out of operations hereunder and
confirm such notification in writing or by
e-mail to the OPERATOR within twelve (12)
hours of the event.
(c) Notwithstanding anything in this CONTRACT to the
contrary, OPERATOR shall be solely responsible for,
and indemnify and hold harmless CONTRACTOR from and
against, all costs of regaining control of any wild
well.
6.6 Sunken Property
When required by law or governmental authority or when
CONTRACTOR'S sunken property interferes with present or
future operations of the OPERATOR, the CONTRACTOR shall at
its own expense raise and remove the DRILLING UNIT and any
property of the CONTRACTOR or its SUB- CONTRACTORS which
may sink in the course of operations hereunder or
otherwise deal with it in accordance with the OPERATOR'S
direction. In the event that the CONTRACTOR does not carry
out these obligations the OPERATOR may buoy and light the
sunken DRILLING UNIT or property and may remove it
(without prejudice to the OPERATOR'S rights) and in such
event CONTRACTOR shall refund to the OPERATOR all costs so
incurred. The fact that the sunken DRILLING UNIT or
property is insured or has been declared a total loss
shall not absolve the CONTRACTOR from its obligations to
raise and/or remove same. This CLAUSE shall remain binding
on the CONTRACTOR and OPERATOR notwithstanding the
termination of the CONTRACT for any reason.
6.7 Consequential Damages
Notwithstanding any other provision in the CONTRACT in no
event shall the CONTRACTOR, SERVICE COMPANIES or OPERATOR
or its CO-VENTURERS in the CONTRACT AREA be liable one to
the other for any consequential damages which may be
suffered by any or all parties in connection with the
11
SECTION 2
CONDITIONS OF CONTRACT
PAGE 12 OF 22
================================================================================
performance of or otherwise arising under the CONTRACT
notwithstanding that such consequential damages may have
been due to the negligence of any of the parties
aforesaid. Consequential damages shall mean, but not by
way of limitation, loss of profits, loss of production or
business interruption.
6.8 Notwithstanding anything to the contrary contained in sub
clauses 6.1 to 6.7 inclusive, it is clearly understood
between all parties that the CONTRACTOR only provides the
above indemnities in respect of SERVICE COMPANIES and
likewise OPERATOR only provides indemnities in respect of
SERVICE COMPANIES on the express understanding that
SERVICE COMPANIES provide reciprocal indemnities to
CONTRACTOR as contained in the SERVICE COMPANIES contracts
with OPERATOR.
6.9 The rights of CONTRACTOR and of OPERATOR under this Clause
6 shall extend to their respective Affiliates and
employees and employees of their respective Affiliates.
6.10 The rights and obligations under this Clause 6 shall
continue notwithstanding the completion or termination of
the work under this CONTRACT.
CLAUSE.7. CONTRACTOR'S INSURANCES
7.1 The CONTRACTOR shall take out and maintain appropriate
first class insurance with respect to its liabilities
assumed and indemnities given under the CONTRACT and as
specifically required in SECTION 3 hereof. All such
policies shall contain waivers of rights of subrogation
against the OPERATOR, its CO-VENTURERS, AFFILIATES and the
SERVICE COMPANIES.
The CONTRACTOR shall give the OPERATOR thirty days written
notice of any proposed material change in any policy.
7.2 The CONTRACTOR shall extend to the OPERATOR, its
CO-VENTURERS and the SERVICE COMPANIES the benefit of any
Hull and Machinery insurance cover, which may exist under
the CONTRACTOR'S insurance provisions.
7.3 If the CONTRACTOR shall fail to effect and keep in force
any of the Insurances referred to herein, then the
OPERATOR may effect and keep the same in force and pay
such premium as may be necessary for that purpose and from
time to time deduct the amount so paid by the OPERATOR as
aforesaid from any monies due or which may become due to
the CONTRACTOR or recover the same as a debt due from the
CONTRACTOR.
7.4 CONTRACTOR shall require its SUB-CONTRACTORS to
obtain, maintain and keep in force during the time in
which they are engaged in performing any work hereunder,
insurance coverage acceptable to CONTRACTOR and furnish
CONTRACTOR acceptable evidence of such insurance.
CONTRACTOR shall require all insurance policies carried by
the SUB-CONTRACTOR to contained endorsements waiving
insurer's rights of subrogation against the OPERATOR, its
CO-VENTURERS, AFFILIATES and the SERVICE COMPANIES.
CLAUSE.8. TAX INFORMATION AND INDEMNITY
8.1 CONTRACTOR shall be responsible for, and shall hold
OPERATOR harmless from the reporting, filing and payment
of any taxes (wherever and whenever arising), duties,
charges or fees (and any related fines, penalties, or
interest) imposed (except as provided in Section 8.2
12
SECTION 2
CONDITIONS OF CONTRACT
PAGE 13 OF 22
================================================================================
herein) directly or indirectly on CONTRACTOR or its
SUB-CONTRACTORS, shareholder(s), employees, agents or
servants as a result of CONTRACTOR's performance under
this CONTRACT in all jurisdictions. OPERATOR may withhold
from sums otherwise due CONTRACTOR under this Contract any
taxes or amounts required by applicable law to be withheld
and paid to the appropriate taxing authorities and,
OPERATOR shall provide CONTRACTOR with all receipts
evidencing the payment to such authorities of the taxes or
amounts so withheld.
8.2 The payments provided for pursuant to Section 5 are
exclusive of any value added taxes or sales/service taxes
which may be imposed on such payments by the taxing
authorities having jurisdiction. Subject to OPERATOR's
right to verify that CONTRACTOR and its SUB-CONTRACTORS
are registered in accordance with the appropriate section
of the Trinidad and Tobago Value Added Tax Act; and the
right to verify that such taxes apply to the payments made
hereunder, and subject to OPERATOR's right to verify
CONTRACTOR's payment of such taxes to the appropriate
taxing authorities, OPERATOR shall pay CONTRACTOR the
amount of such taxes upon receipt of invoice, including
the amount of such taxes, which invoice is issued in
compliance with the applicable tax laws. CONTRACTOR shall
use its best efforts to avail itself of any and all
exemptions from and/or reductions of such taxes.
8.3 CONTRACTOR shall comply and shall use reasonable efforts
to ensure that all SUB-CONTRACTORS comply, with all legal
contractual and administrative requirements in relation to
their status and presence in Trinidad, including, without
limitation, registration for corporation tax and value
added tax purposes. For the avoidance of doubt, CONTRACTOR
will be registered for corporation tax and value added tax
under the appropriate sections of the Government of the
Republic of Trinidad and Tobago Income Tax Act and/or
Corporation Tax Act and Value Added Tax Act for the
duration of this CONTRACT and will provide OPERATOR
satisfactory evidence to that effect. CONTRACTOR shall
indemnify and hold harmless OPERATOR for any failure by it
or its SUB-CONTRACTORS to comply with the requirements of
this clause.
8.4 For all personnel of CONTRACTOR and its SUB-CONTRACTORS,
and all local personnel directly employed by CONTRACTOR
and its SUB-CONTRACTORS in Trinidad in connection with
CONTRACTOR's performance under this Contract, personal
income tax obligations, including withholding tax, shall
be the responsibility of CONTRACTOR. CONTRACTOR shall
indemnify and hold OPERATOR harmless from any failure by
it or its SUB-CONTRACTORS to calculate and collect this
income tax and pay it directly to the applicable
authorities. In no instance shall such personnel be
considered to be employees of OPERATOR.
8.5 Any fines, interest, penalties or other costs incurred by
CONTRACTOR or its agents, employees or SUB-CONTRACTORS for
non-compliance by CONTRACTOR, its agents, employees or
SUB-CONTRACTORS with the requirement of any LAWS shall be
the sole responsibility of CONTRACTOR.
8.6 CONTRACTOR shall indemnify OPERATOR against any and all
costs including fines, interest, penalties and reasonable
legal costs suffered or incurred by OPERATOR and resulting
from CONTRACTOR's failure to comply with relevant taxation
and import or custom duty requirements.
8.7 CONTRACTOR shall be liable for and shall indemnify and
hold harmless OPERATOR against any taxes, duties, levies,
charges, and/or fees assessed in connection with the
importation, sale or disposition of assets of CONTRACTOR,
or assets of any SUB-CONTRACTOR and for the failure to
export such previously imported assets or the assets of
any SUB-CONTRACTOR following the conclusion of the work to
be performed under this Contract. OPERATOR shall not be
13
SECTION 2
CONDITIONS OF CONTRACT
PAGE 12 OF 22
================================================================================
liable and OPERATOR shall not reimburse CONTRACTOR for any
third party fees or charges in connection with such
importation or exportation.
8.8 CONTRACTOR acknowledges that it is aware that OPERATOR is
anticipated to obtain a Minister's License under the
Customs Act of the laws of the Republic of Trinidad and
Tobago, which will provide for exemption from import
duties in Trinidad in relation to imports associated with
OPERATOR's offshore petroleum and exploration operations.
CONTRACTOR undertakes to comply fully and to procure the
compliance of all SUB-CONTRACTORS with all legal,
contractual and administrative requirements of OPERATOR
and any AGENCY and to provide accurate and timely
information to enable OPERATOR to fully benefit from such
exemption in connection with any imports associated with
or linked to CONTRACTOR's performance under this Contract.
CONTRACTOR shall indemnify and hold harmless OPERATOR for
any failure by CONTRACTOR or its SUB-CONTRACTORS to comply
with such requirements, which results in any imposition of
import duties, penalties, interest or fines in respect of
such imports.
CLAUSE 9. BANKRUPTCY OR LIQUIDATION
If the CONTRACTOR shall become bankrupt or insolvent, or
have a receiving order made against it, or present a
petition in bankruptcy or make an arrangement with or an
assignment in favour of its creditors, or shall agree to
carry out the CONTRACT under a Committee of Inspection of
its creditors, or commence to be wound up (not being a
member's voluntary winding up for the sake of
reconstruction), or shall carry on its business under a
receiver for the benefit of its creditors or any of them
then the OPERATOR shall be at liberty either
(a) to suspend immediately all or any of the operations
then in progress and to remove its property and the
property of its SERVICE COMPANIES located on the
DRILLING UNIT or in the possession of the
CONTRACTOR, or
(b) to give such receiver liquidator or any other
person in whom the CONTRACT may become vested the
option of carrying out the CONTRACT subject to his
providing a guarantee in an amount to be agreed for
the due and faithful performance of the CONTRACT
without prejudice in either event to any right of
action or remedy which shall have accrued or shall
accrue thereafter to the OPERATOR, or
(c) to terminate the CONTRACT upon the completion of
the current operations then being performed. No
further payments shall be due to the CONTRACTOR or
its receiver other than those for work done prior
to the said termination
CLAUSE 10. FORCE MAJEURE
No failure or omission by either party to carry out or
observe any of the stipulations, conditions or obligations
to be performed hereunder shall, except as herein
expressly agreed to the contrary, give rise to any claim
against such party or be deemed to be a breach of the
CONTRACT if such failure or omission arises from an event
of force majeure.
An event of force majeure shall mean expropriation or
confiscation, orders of governmental authority, acts of
war (declared or undeclared), insurrection, rebellion or
sabotage, civil disturbances, strikes (except of the
CONTRACTOR'S or SUB-CONTRACTOR'S own workforce), actions
of the elements (except waiting on weather in the field)
14
SECTION 2
CONDITIONS OF CONTRACT
PAGE 15 OF 22
================================================================================
or other causes beyond the reasonable control of the
parties affected thereby but specifically excluding
financial distress.
If by any reason of force majeure either party shall be
prevented from executing or continuing to execute the
CONTRACT, the party so prevented shall forthwith give
notice in writing to the other party of such prevention
and the reasons therefor. Except for the obligation to pay
monies due under the CONTRACT, the obligations of the
parties as have been thus affected shall be suspended for
the duration of such prevention.
In the event that the CONTRACTOR is unable to carry out
the DRILLING SERVICES by reason of force majeure the
OPERATOR shall have the right to instruct the CONTRACTOR
to remain on LOCATION or to move to a new LOCATION and the
appropriate rate as set out in SECTION 5 shall be payable.
In the event the OPERATOR does not exercise this right and
the execution of the CONTRACT has been prevented for a
period of not less than 28 days (during which period the
Schedule 5.1 - FORCE MAJEURE a) Rate shall be payable by
OPERATOR) then either party shall have the right to
terminate the CONTRACT by giving twenty-one (21) days
written notice to the other (during which period the
Schedule 5.1 - FORCE MAJEURE b) Rate shall be payable by
OPERATOR). Upon such notice being given the CONTRACT shall
forthwith be terminated in respect of that operation or
the whole of the CONTRACT according to the subject matter
of the notice, but without prejudice to the claim of any
party in respect of any antecedent breach thereof. In such
event, OPERATOR shall pay the DEMOBILISATION FEE in
accordance with the other provisions of this CONTRACT.
CLAUSE 11. FREEDOM FROM LIENS
Without prejudice to any other provision of the CONTRACT
the CONTRACTOR shall hold harmless and indemnify the
OPERATOR from and against all liens, attachments or claims
by or on behalf of any of the CONTRACTOR'S suppliers,
CONTRACTOR'S PERSONNEL or SUB-CONTRACTORS (or persons
alleging to be suppliers, CONTRACTORS PERSONNEL or
SUB-CONTRACTORS) in connection with or arising out of the
CONTRACT.
CLAUSE 12. CONTRACTOR TO MAINTAIN REPRESENTATION
For a period of not less than 2 years after the
termination or completion of the CONTRACT howsoever
arising the CONTRACTOR shall maintain representation in
the Republic of Trinidad and Tobago through the services
of a person, firm or corporation resident in the CONTRACT
AREA. Such person, firm or corporation shall be empowered
to act and shall have the right to receive summonses on
behalf of the CONTRACTOR in any matter having reference to
the business or affairs of the CONTRACTOR and arising out
of or connected with the CONTRACT. Before appointing any
such person, firm or corporation the CONTRACTOR shall
obtain the prior approval of the OPERATOR thereto.
CLAUSE 13. GIVING OF NOTICES AND PAYMENT OF FEES
The CONTRACTOR shall in connection with the CONTRACT give
all notices and pay all fees and any other monies required
to be given or paid under any Statute, Ordinance, Decree,
Proclamation or any other Order or any other enactment or
any regulations or By-law of any Local or other duly
constituted authority having the force of law in the
15
SECTION 2
CONDITIONS OF CONTRACT
PAGE 16 OF 22
================================================================================
CONTRACT AREA and under the rules and regulations of all
public bodies and public companies whose property or
rights are affected or may be affected, provided always
that the OPERATOR will repay or allow to the CONTRACTOR
all such sums as OPERATOR'S REPRESENTATIVE shall certify
to have been properly and necessarily payable and paid by
the CONTRACTOR in respect of any such fees or monies the
obligation for which does not exist at the date hereof,
provided further that in respect of any such fees or
monies the obligation for payment of which does exist at
the date hereof but which ceases after the date hereof the
CONTRACTOR shall repay or allow to the OPERATOR all such
sums as OPERATOR'S REPRESENTATIVE shall certify are not
properly payable by it or which if paid are refundable to
it.
CLAUSE 14. CONFIDENTIAL INFORMATION
All information obtained by the CONTRACTOR in the course
or conduct of its services hereunder shall be considered
confidential and shall not be divulged by the CONTRACTOR,
its personnel or agents to any person, firm or corporation
other than the OPERATOR'S designated representatives.
CONTRACTOR'S report shall contain only such information as
is authorised for release by the OPERATOR's
representative. The obligations under this clause shall
continue notwithstanding the completion or termination of
the work under this CONTRACT.
CLAUSE 15. PUBLICITY
The CONTRACTOR shall not publish or permit to be published
either alone or in conjunction with any other person any
articles, photographs or other illustrations relating to
the OPERATOR'S business generally or to the work
hereunder, without prior reference to and approval in
writing from OPERATOR. Such consent shall only apply to
each specific application and relate only to that
application. The accuracy of any information, which was
not supplied directly by OPERATOR, shall be the absolute
responsibility of the CONTRACTOR. As an exception to the
requirement for reference to and approval of OPERATOR in
respect to publications or the permitting of publications
of any articles, photographs or other illustrations
relating to the work hereunder, CONTRACTOR shall not be
obligated to make such reference and obtain such consent
if such publication is required, in CONTRACTOR's
reasonable opinion, to be disclosed by applicable LAWS or
stock exchange rules. In such event, CONTRACTOR shall
inform OPERATOR prior to making such disclosure. The
obligations of this clause shall continue notwithstanding
the completion or termination of the work under this
CONTRACT.
CLAUSE 16. ASSIGNMENT AND SUB-CONTRACTING
16.1 Assignment
Except to wholly-owned subsidiary of CONTRACTOR capable of
performing CONTRACTOR'S obligations hereunder the
CONTRACTOR shall not without the prior written consent of
the OPERATOR assign the CONTRACT or any part thereof or
any benefit or interest therein or thereunder. Such
consent shall not be unreasonably withheld. In the event
of assignment to a wholly-owned subsidiary of CONTRACTOR,
CONTRACTOR shall give prior written notice of the intended
assignment and CONTRACTOR shall remain primarily
responsible to OPERATOR for the obligations of the
assignee which pertain to this CONTRACT and shall be
liable for any and all obligations set forth herein in the
event that such assignee fails to fulfil any obligation
imposed on the CONTRACTOR herein.
16
SECTION 2
CONDITIONS OF CONTRACT
PAGE 17 OF 22
================================================================================
OPERATOR may assign or sub-let the whole or part of its
rights, liabilities and obligations to a wholly owned
subsidiary of the BP Amoco plc upon the terms and
conditions as those agreed between the parties hereto
without the consent of the CONTRACTOR, and to any other
party with the consent of the CONTRACTOR and such consent
shall not be unreasonably withheld.
16.2 Sub-Contracting
The CONTRACTOR shall not enter into any sub-contract for
the whole or any part of its obligations under the
CONTRACT without the prior written consent of the OPERATOR
and such consent if given shall not relieve the CONTRACTOR
from any liability or obligation under the CONTRACT and
the CONTRACTOR shall be responsible for the acts, defaults
and negligence of any SUB-CONTRACTOR, its personnel or
agents as fully as if they were the acts, defaults or
neglects of the CONTRACTOR, its personnel or agents.
The CONTRACTOR shall ensure that all its sub-contracts
shall include provisions to the like effect as the
provisions hereof. In addition the CONTRACTOR shall ensure
that the SUB-CONTRACTOR'S personnel (where applicable) are
made aware of, and follow the provisions for Fire and
Safety Precautions and Emergency Procedures as set out in
SECTION 4.
CLAUSE 17. APPLICATION OF LAWS AND REGULATIONS
The CONTRACTOR shall comply with all laws, rules and
regulations of Government or local or other authority
which are effective at the date hereof or may in the
future become applicable to the CONTRACTOR'S business,
CONTRACTOR'S EQUIPMENT and CONTRACTOR'S PERSONNEL engaged
in the operations hereunder. The CONTRACTOR shall promptly
advise the OPERATOR of any such laws, rules or regulations
with which it believes it is unable to comply.
The CONTRACTOR shall ensure that its PERSONNEL,
SUB-CONTRACTORS and agents observe all such laws, rules
and regulations and shall at the CONTRACTOR'S expense
replace any CONTRACTOR'S PERSONNEL or SUB-CONTRACTOR'S
personnel or agents whose conduct or behaviour may
reasonably be considered by the OPERATOR to be in breach
or conflict with such laws, rules or regulations.
CLAUSE 18. SERVING OF NOTICES
18.1 Any notice in writing to be given hereunder to the
OPERATOR shall be sent by hand, telex, facsimile or
registered post to the OPERATOR to the at the following
address:
BP TRINIDAD AND TOBAGO LLC
▇.▇. ▇▇▇ ▇▇▇ or by hand Queen's Park Plaza
Port of Spain 5 & ▇▇ ▇▇▇▇▇'▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇ Port of Spain, Trinidad
Attention: THE CONTRACTS MANAGER
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
17
SECTION 2
CONDITIONS OF CONTRACT
PAGE 18 OF 22
================================================================================
18.2 Any notice in writing to be given hereunder to the
CONTRACTOR shall be sent to it by hand, telex, facsimile
or registered post at its address stated in the CONTRACT
or some address in the CONTRACT AREA stated by it to be in
lieu thereof for the purpose of this sub-clause.
▇▇▇▇▇▇ Offshore Inc.
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇, Vice President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
18.3 Any such notice given by facsimile shall be deemed to have
been received and shall take effect at the expiration of
24 (twenty-four) hours after the sending.
CLAUSE 19. VARIATION AND WAIVER
No variation or waiver of any obligation hereunder shall
be valid or effective unless confirmed in writing in the
case of a variation by all parties and in the case of a
waiver then by the party towards whom the obligation shall
have been undertaken.
CLAUSE 20. INDEPENDENT CONTRACTOR RELATIONSHIP
20.1 In the performance of the DRILLING SERVICES the CONTRACTOR
shall be an independent Contractor with the authority to
control and direct the performance thereof, but the
DRILLING SERVICES shall be subject to the approval of the
OPERATOR and be subject to a general right of inspection
and any necessary supervision thereof which the OPERATOR
may choose to exercise if necessary to secure the
satisfactory completion thereof.
20.2 The actual performance and superintendence of the DRILLING
SERVICES hereunder shall be by the CONTRACTOR but the
OPERATOR REPRESENTATIVE shall at all times have access to
all parts of the DRILLING UNIT for the purpose of
inspecting the CONTRACTOR'S EQUIPMENT or observing tests
or inspecting the DRILLING SERVICES in order to judge
whether in the OPERATOR'S opinion the CONTRACTOR'S
EQUIPMENT is complete and in an efficient operating
condition and whether the DRILLING SERVICES are being
performed by the CONTRACTOR in accordance with the
provisions of this CONTRACT. In addition, operations shall
be carried out at the request and in accordance with the
instructions of the OPERATOR'S REPRESENTATIVE who shall
inform the CONTRACTOR'S REPRESENTATIVE of the end result
desired from any operation, but the CONTRACTOR shall have
the entire responsibility for the proper and timely
execution thereof.
20.3 The CONTRACTOR shall give all reasonable assistance to the
OPERATOR'S REPRESENTATIVE in the performance of his
duties. However, the presence of and/or inspection and/or
supervision by the OPERATOR'S REPRESENTATIVE hereunder
shall not relieve the CONTRACTOR of any of its obligations
or responsibilities hereunder.
CLAUSE 21. INFRINGEMENT OF PATENTS
The CONTRACTOR shall save harmless and indemnify the
OPERATOR from and against all claims proceedings and
liabilities for or on account of infringement or alleged
infringement of any patent rights design trade ▇▇▇▇ or
name or other protected right of any THIRD PARTY arising
18
SECTION 2
CONDITIONS OF CONTRACT
PAGE 19 OF 22
================================================================================
in connection with the use of any CONTRACTOR furnished
equipment machinery materials or process and shall defend
at its sole expense any and all such proceedings to which
both parties are defendants. Both the CONTRACTOR and the
OPERATOR shall at all times have the right to be
represented respectively by their own counsel and to
participate in the defence of any such proceedings if both
shall be made parties defendant thereto. The CONTRACTOR
shall give notice in writing forthwith to the OPERATOR of
any such claims and proceedings as aforesaid and shall
supply the OPERATOR with all information and documents in
connection therewith as the OPERATOR may reasonably
require.
The OPERATOR shall save harmless and indemnify the
CONTRACTOR from and against all claims, proceedings and
liabilities for or on account of infringement or alleged
infringement of any patent rights, design, trade ▇▇▇▇ or
name or other protected right of any THIRD PARTY arising
in connection with the use of any OPERATOR or SERVICE
COMPANY furnished equipment, machinery, materials or
process and shall defend at its sole expense any and all
such proceedings to which both parties are defendants.
Both the OPERATOR and the CONTRACTOR shall at all times
have the right to be represented respectively by their own
counsel and to participate in the defence of any such
proceedings if both shall be made parties defendant
thereto. The OPERATOR shall give notice in writing
forthwith to the CONTRACTOR of any such claims and
proceedings as aforesaid and shall supply the CONTRACTOR
with all information and documents in connection therewith
as the CONTRACTOR may reasonably require.
CLAUSE 22. PERMITS AND LICENCES
22.1 CONTRACTOR shall be responsible for obtaining and
maintaining all authorisations, permits and licenses
necessary for the Work, which may be obtained in the name
of CONTRACTOR, its SUB-CONTRACTORS, its vendors, and their
respective employees. OPERATOR shall provide reasonable
assistance to CONTRACTOR in that endeavour, if asked by
CONTRACTOR.
22.2 CONTRACTOR shall be responsible for obtaining all the
necessary visas, customs clearances or other government
authorisations required for moving CONTRACTOR's PERSONNEL
or its SUB-CONTRACTORS' personnel into and out of the
country having jurisdiction over the CONTRACT AREA,
including without limitation work permits and tax exit
certificates for such personnel. OPERATOR shall, if asked
by CONTRACTOR, assist CONTRACTOR in obtaining such work
permits. OPERATOR does not warrant that the authority
having jurisdiction over work permits will issue any work
permit.
CLAUSE 23. APPLICABLE LAW
The CONTRACT shall be governed by and construed in
accordance with the laws of the Republic of Trinidad and
Tobago .
CLAUSE 24. ARBITRATION
If any dispute or difference of any kind whatsoever shall
arise between the parties hereto in connection with or
arising out of the CONTRACT or any interpretation thereof
which cannot be resolved by agreement between the parties
hereto the same shall be determined in accordance with the
Arbitration Act Chap. 5:01 of the laws of the Republic of
Trinidad and Tobago. Arbitration proceedings shall take
place in Trinidad unless otherwise agreed by the parties.
19
SECTION 2
CONDITIONS OF CONTRACT
PAGE 20 OF 22
================================================================================
CLAUSE 25. EXCLUSION OF PREVIOUS CORRESPONDENCE
All previous correspondence, negotiations,
representations, explanations, statements, promises or
guarantees whether oral or written are hereby excluded
from the CONTRACT.
CLAUSE 26. AUDIT
The OPERATOR shall have the right to audit during normal
business hours the relevant books and accounts of the
CONTRACTOR at its address herein in relation to
reimbursable items paid for by OPERATOR under the CONTRACT
at any time until the expiry of twenty-four months
following the settlement of the final account. Any
incorrect payments made by OPERATOR shall be adjusted in
accordance with the findings of the said audit. The
CONTRACTOR shall make all relevant books and accounts
available and give the auditors all reasonable assistance
and ensure that its SUB-CONTRACTORS comply with such
provisions.
CLAUSE 27. SEVERABILITY
If any provision of this CONTRACT or any application
thereof shall be determined to be invalid or unenforceable
such invalidity or unenforceability shall not affect
remaining provision of this CONTRACT and remaining
provisions shall continue in full force and effect.
CLAUSE 28. MORTGAGE OF THE RIG
THIS CONTRACT IS SUBJECT TO EACH OF THE RIGHTS AND
REMEDIES OF THE SECRETARY OF TRANSPORTATION OF THE UNITED
STATES OF AMERICA, AND HAS BEEN ASSIGNED TO THE SECRETARY
UNDER A SECURITY AGREEMENT AND MORTGAGE, EACH EXECUTED BY
THE CONTRACTOR AS SHIPOWNER IN FAVOR OF THE SECRETARY WITH
RESPECT TO THE DRILLING UNIT. OPERATOR ACKNOWLEDGES THAT
CONTRACTOR IS REQUIRED TO PROVIDE MARAD WITH A COPY OF
THIS CONTRACT WITHIN TEN (10) DAYS OF ITS EXECUTION.
20
SECTION 3
CONTRACTOR'S INSURANCE
It is the intention that the OPERATOR and all Contractors working together to
undertake the drilling operations should carry out their work in accordance with
good oilfield and/or industry practice. It is recognised, however, that
accidents and damage may from time to time occur. Such risks are to be covered
in the following manner:-
1. Personnel
1.1. Employers' Liability or similar, including the local legal
coverage in the CONTRACT AREA or any other jurisdiction,
for which CONTRACTOR is obliged to pay benefits and
including, but not limited to for example, Maritime
Employer's Liability to provide transportation,
maintenance and cure. Employer's Liability limit shall be
in accordance with any applicable legislation but not less
than US$2,000,000 each incident per person.
The underwriter shall, in addition, waive all rights of
Subrogation against the other parties involved in the
drilling operations.
2. Equipment
2.1. For equipment other than vessels:
All risks insurance with policy limits equal to the market
value of the CONTRACTOR'S equipment.
2.2. For Vessels:
(a) Hull and Machinery Insurance (extended to cover all
risks including Collision Liability) with policy
limits equal to the replacement value of the
vessels having a deductible not greater than
US$250,000 each or 10% of the replacement value
which ever is the lesser each and every loss.
(b) Protection and Indemnity Insurance with policy
limits equal to the replacement value of the
vessels.
2.3. For Fixed and Rotary Wing Aircraft
Hull insurance for the current or replacement value of
each aircraft and covering any accident or damage thereto,
howsoever caused.
2.4. Wreck and Debris:
Wreck and debris removal insurance coverage on the
CONTRACTOR'S EQUIPMENT, vessels or aircraft as appropriate
as per terms of sub clause 6.6 of SECTION 2 (Conditions of
Contract).
2.5. War risk insurance coverage on the CONTRACTOR'S EQUIPMENT,
vessels or aircraft as appropriate covered by the
CONTRACT, if necessary.
CONTRACTOR'S EQUIPMENT, vessels or aircraft as
appropriate covered by the CONTRACT, if necessary.
SECTION 3
CONTRACTOR'S INSURANCE
PAGE 2 OF 2
================================================================================
The underwriters shall, in addition, waive all rights of
Subrogation against the other parties involved in the
drilling operations and name OPERATOR and its SERVICE
COMPANIES as Additional Assureds.
3. Third Party
Each Contractor shall carry:-
Comprehensive General Liability Insurance, including
premises, operations, independent contractors, contractual
and collision liability for any written agreement and
coverage for the operation of the CONTRACTOR'S EQUIPMENT,
vessels or aircraft as appropriate covered by the
CONTRACT.
Bodily Injury US $10,000,000 any one occurrence
Property Damage US $10,000,000 any one occurrence
In addition for aircraft, aircraft Third Party Legal
Liability including passenger, baggage and cargo (in the
names of CONTRACTOR and OPERATOR) up to a combined single
limit of US$80,000,000 (eighty million US Dollars) any one
accident or occurrence, each aircraft.
The underwriters shall, in addition, waive all rights of
Subrogation against the other parties involved in the
drilling operations.
4. Automobiles
Comprehensive Automobile Liability Insurance covering all
owned, hired and non-owned automotive equipment, including
compliance with all local legislation on automobile
insurance in the state or country in which the automotive
equipment is being used.
The underwriters shall, in addition, waive all rights of
Subrogation against the other parties involved in the
drilling operations.
5. Certificates of Insurance
Before commencing performance of this CONTRACT, CONTRACTOR
shall furnish OPERATOR with Certificates of Insurance
indicating:
5.1. kinds and amounts of insurance as required.
5.2. insurance company and companies carrying the
aforesaid coverage.
5.3. effective and expiry dates of policies.
2
SECTION 4
STATEMENT OF REQUIREMENTS
CONTENTS
1. OBLIGATIONS OF THE CONTRACTOR
2. WORK TO BE PERFORMED BY THE CONTRACTOR
3. FACILITIES TO BE PROVIDED BY CONTRACTOR
4. THE CONTRACTOR'S EQUIPMENT
5. SAFETY
6. CONTRACTOR'S OTHER OBLIGATIONS
7. RESPONSIBILITIES OF THE OPERATOR
ATTACHMENT 1 - CHECK LIST OF RESPONSIBILITIES
ATTACHMENT 2 - REPORTING
STATEMENT OF REQUIREMENTS
CLAUSE l OBLIGATIONS OF THE CONTRACTOR
The CONTRACTOR shall carry out the DRILLING SERVICES and
perform all its obligations under the CONTRACT with due
diligence and care, in a good and workmanlike manner, in
accordance with good drilling practices, without undue
delays and in conformity in all respects with the terms
and conditions of the CONTRACT.
CONTRACTOR shall be solely responsible for the operation
of the DRILLING UNIT including, without limitation,
supervising moving operations and the positioning of the
DRILLING UNIT on LOCATIONS as required by OPERATOR,
subject to Clause 4 of SECTION 2 of this CONTRACT, as well
as such operations on board the DRILLING UNIT as may be
necessary for the safety of the DRILLING UNIT.
CLAUSE 2 WORK TO BE PERFORMED BY THE CONTRACTOR
Consistent with the provisions of this CONTRACT, the
CONTRACTOR shall:
2.1 Drilling
Drill vertically or directionally, complete,
suspend, plug and abandon or workover ▇▇▇▇▇ and
carry out such other drilling operations on ▇▇▇▇▇
in accordance with the drilling and other
programmes issued by or instructions given by the
OPERATOR from time to time. The DEPTHS specified
in such programmes are predictions and may be
subject to change by the OPERATOR.
The maximum depth shall not exceed 24,607 ft.
2.2 Casing and Tubing
Run strings of casing, liner and tubing
(hereinafter referred to as "Tubulars") as
specified in the WELL programmes issued by the
OPERATOR from time to time. The CONTRACTOR shall
store, handle, run and land with such Tubulars in
accordance with the OPERATOR'S procedures.
2.3 Recovery of Tubulars
Whenever so requested by the OPERATOR endeavour
to recover strings of Tubulars from a WELL.
2.4 Depth Measurement
Keep an accurate measurement of the DEPTH in feet
and record such DEPTHS on OPERATOR'S daily
drilling report and on IADC-API Daily Drilling
Report Forms. OPERATOR shall have the right at
any time to require CONTRACTOR to make check
measurements of the DEPTH in such manner as
OPERATOR may specify.
SECTION 4
STATEMENT OF REQUIREMENTS
PAGE 2 OF 16
================================================================================
Measure and make diagram sketch of all tubulars
going into the hole with Inner Diameter and Outer
Diameter and the fishing neck. Check to be made
if fishing tools available to suit all sizes run
in hole.
2.5 Specialised Operations
Whenever so instructed by OPERATOR permit and
assist SERVICE COMPANIES to carry out
cementation, formation testing, stimulation,
logging, diamond drilling, turbine drilling,
coring, directional drilling, inspection and
making up and/or pressure testing of tubulars or
any other specialised operation.
2.6 Pressure Testing
Carry out pressure testing of wellheads, casing
strings, blow-out prevention equipment, casing
cement jobs and other equipment specified by the
OPERATOR in accordance with the procedures
prescribed from time to time by the OPERATOR. The
results of all such tests shall be noted on said
OPERATOR'S Daily Drilling Report and on IADC-API
Daily Drilling Report Forms. Provide charted
recordings.
2.7 Drilling Fluid
Make, condition and control drilling fluid in
accordance with mud programmes issued from time
to time by the OPERATOR, under the supervision of
or in accordance with instructions given by the
OPERATOR.
2.8 Cores
Whenever required to do so by the OPERATOR'S
REPRESENTATIVE to provide assistance in carrying
out coring operations as required by the
OPERATOR.
2.9 WELL Deviation Surveys
Make deviation surveys with instruments listed in
SECTION 7 whenever the OPERATOR may so require.
2.10 Care and Use of Tubulars
(a) properly handle, store and tally all
Tubulars while in the CONTRACTOR'S
possession.
(b) retain thread protectors on all Tubulars
until instructed by OPERATOR to remove
for cleaning and lubricating with API
approved thread cleaning and thread
lubricating compounds provided prior to
running in the hole.
(c) check Tubular drift diameters with
mandrels provided by OPERATOR or
CONTRACTOR whenever so instructed by the
OPERATOR and report any rejected joints
in the IADC report.
(d) employ "Klampon" or equivalent Tubular
thread protector provided by OPERATOR
when handling Tubulars between the rack
and the rig floor.
2
SECTION 4
STATEMENT OF REQUIREMENTS
PAGE 3 OF 16
================================================================================
2.11 On LOCATION Inspection of OPERATOR'S MATERIALS
Inspect visually for defects all OPERATOR'S
MATERIALS before using them and notify the
OPERATOR of any such defects apparent therein.
Also verify the quantities and shortfall, if any,
and pay attention to certification and inspection
records (e.g. MSDS sheets for chemicals).
2.12 Work Period
Operate the DRILLING UNIT on the basis of a 24
(twenty-four) hour day and a 7 (seven) day week
without shutdown for holidays unless otherwise
instructed by OPERATOR or unless required so to
do in order to comply with the laws and
regulations of the government or properly
authorised local authority having jurisdiction
over the CONTRACT AREA.
Crew change periods shall be in accordance with
Schedule 6.1 of SECTION 6 hereto.
2.13 Handling and Storage of OPERATOR'S MATERIALS and
SERVICE COMPANY materials
Whenever required by the OPERATOR (who shall not
so require unreasonably, taking account of
constraints of weather, availability of
CONTRACTOR'S PERSONNEL, capacity of CONTRACTOR'S
EQUIPMENT and space or weight limitations on the
DRILLING UNIT) take on board in Trinidad or such
other location designated by OPERATOR or unload
OPERATOR'S MATERIALS and SERVICE COMPANY
materials from OPERATOR'S work boats onto the
DRILLING UNIT and store and handle OPERATOR'S
MATERIALS and SERVICE COMPANY materials thereon.
Whenever so required by OPERATOR (who shall not
so require unreasonably as aforesaid) unload
OPERATOR'S MATERIALS and SERVICE COMPANY
materials from the DRILLING UNIT onto OPERATOR'S
work boats or in Trinidad or such other location
designated by OPERATOR.
It is the responsibility of the CONTRACTOR to
store and maintain records of such storage of all
items of equipment and material loaded onto the
DRILLING UNIT.
2.14 Documentation for OPERATOR'S MATERIALS and
SERVICE COMPANY materials
Acknowledge receipt and despatch of OPERATOR'S
MATERIALS and SERVICE COMPANY materials in
accordance with instructions laid down by
OPERATOR from time to time. The CONTRACTOR shall
exercise appropriate care towards all such
materials and equipment, which have been left in
its possession for safe storage by OPERATOR and
SERVICE COMPANIES.
2.15 Materials and Logistics Support
CONTRACTOR shall employ a fully qualified and
experienced Materials/Logistics Supervisor who
shall be approved by OPERATOR and shall be
permanently based in Trinidad and shall be
available at all times to arrange and supervise
3
SECTION 4
STATEMENT OF REQUIREMENTS
PAGE 4 OF 16
================================================================================
all CONTRACTOR'S EQUIPMENT and PERSONNEL
movements. The Materials/Logistics Supervisor
shall maintain day to day liaison with OPERATOR'S
Base Manager in Trinidad in order that efficient
and timely scheduling, loading and unloading of
supply vessels and helicopter operations is
maximised.
CONTRACTOR shall at all times comply with
OPERATOR'S instructions and requirements with
regard to all materials and logistics operations
including the import and export of EQUIPMENT,
materials and supplies together with the movement
of PERSONNEL. Such instructions, as aforesaid,
shall be supplied to CONTRACTOR in writing and
may be modified from time to time at OPERATOR'S
discretion.
CLAUSE 3 FACILITIES AND SERVICES TO BE PROVIDED BY CONTRACTOR
Unless otherwise stated the CONTRACTOR shall at its cost
and expense furnish all facilities and services necessary
for the proper performance of its contractual obligations
including but not by way of limitation:
3.1 Accommodation and messing for its PERSONNEL
on the DRILLING UNIT to standard reasonably
acceptable to OPERATOR.
3.2 Accommodation and messing for OPERATOR'S
personnel, its trainees, its SERVICE COMPANIES'
personnel on the DRILLING UNIT to the same
standard provided by the CONTRACTOR for its
PERSONNEL.
3.3 One room on the DRILLING UNIT shall be used
exclusively as an infirmary and shall be designed
and equipped to standards reasonably acceptable
to OPERATOR together with adequate medical
supplies. OPERATOR shall evacuate any casualties
among the CONTRACTOR'S PERSONNEL on the DRILLING
UNIT and the CONTRACTOR shall reimburse the
OPERATOR there for up to the limit of the
CONTRACTOR'S insurance. CONTRACTOR shall be
entirely liable at its cost for any subsequent
medical treatment.
3.4 CONTRACTOR shall provide paramedics to work a
28/28 rotation on board the DRILLING UNIT. Such
paramedics shall be hired by CONTRACTOR and paid
for by the OPERATOR. During the term of this
CONTRACT, CONTRACTOR shall use its best efforts
to train a national to assume the role of
paramedic, with the intent to build local
capability and replace the expatriate paramedic
with a national paramedic.
3.5 OPERATOR shall have the right to inspect such
accommodation, messing and medical facilities at
any time. The CONTRACTOR shall comply with
OPERATOR's standard procedures in respect of
safety and hygiene as the OPERATOR may issue from
time to time.
3.6 CONTRACTOR shall provide two (2) Safety and
Training Coordinators (STC) to work a 28/28
rotation on board the DRILLING UNIT. Such STC
shall be hired by and paid for by the CONTRACTOR.
3.7 OPERATOR requires and CONTRACTOR shall provide
free of charge suitable space and general support
services, including but not limited to,
communication equipment (telephone) and DRILLING
UNIT Alarm system, air, water and electricity for
the SERVICE CONTRACTOR'S equipment and
installations as listed above.
4
SECTION 4
STATEMENT OF REQUIREMENTS
PAGE 5 OF 16
================================================================================
CLAUSE 4 THE CONTRACTOR'S EQUIPMENT
The CONTRACTOR shall:
4.1 at the COMMENCEMENT DATE make the CONTRACTOR'S
EQUIPMENT available to OPERATOR at the first
LOCATION in the CONTRACT AREA.
4.2 prior to the COMMENCEMENT DATE give written
evidence to the OPERATOR that the DRILLING UNIT
has proper CERTIFICATION.
4.3 ensure that Classification and the said
CERTIFICATION is maintained at CONTRACTOR'S cost
and expense throughout the duration of the
CONTRACT and any extensions thereto.
In the event that during the continuance of the
CONTRACT the said CERTIFICATION lapses then the
CONTRACTOR shall use its best endeavours to have
the DRILLING UNIT re-certified by the said
Authorities for the remainder of the period of
CONTRACT by means of on-site inspection, tests
and trials (by the said Authorities) at a time or
times agreed with the OPERATOR.
4.4 use its best endeavours to implement without
delay, but after consultation with the OPERATOR,
any alteration, replacement or other change to
the DRILLING UNIT that may be required by any
statute, ordinance, decree, proclamation or any
other order or enactment or regulation or by-law
of any local or duly constituted authority having
the force of law in the CONTRACT AREA. All costs
incurred by the CONTRACTOR in implementing such
alterations as aforesaid shall be to its account.
4.5 give the OPERATOR an undertaking that at the
COMMENCEMENT DATE, CONTRACTOR does not have
knowledge of any damage or defects of the
DRILLING UNIT and associated equipment, which
would necessitate repairs to the DRILLING UNIT
during the continuance of the CONTRACT.
4.6 upon request of OPERATOR, make available to
OPERATOR all or any of the following:
(a) the environmental design criteria of the
DRILLING UNIT.
(b) all records of surveys, repairs and
modifications of a structural nature
that have been made to the DRILLING UNIT
since it was first launched.
(c) of the current and past official Marine
Log Books pertaining to the DRILLING
UNIT, records of Inclining Test Results
of the DRILLING UNIT and any other
records which have been made which
report on the structural integrity and
stability history of the DRILLING UNIT.
(d) authorisation from the CONTRACTOR to the
Classification Society by whom the
DRILLING UNIT is classified to enable
the said Society to release to OPERATOR
such details or information concerning
the DRILLING UNIT as OPERATOR may
request and which is available in the
records of the said Society.
4.7 during the continuance of the CONTRACT maintain
and repair the DRILLING EQUIPMENT to ensure that
its performance meets the specifications quoted
by the manufacturers and that the quantities of
the said EQUIPMENT are maintained.
5
SECTION 4
STATEMENT OF REQUIREMENTS
PAGE 6 OF 16
================================================================================
4.8 whenever so requested by the OPERATOR permit and
give every assistance for an inspection of the
CONTRACTOR'S EQUIPMENT to be carried out by the
OPERATOR or its SERVICE COMPANY. The OPERATOR
shall have the right to reject all or any of the
CONTRACTOR'S EQUIPMENT so inspected and take such
action, as it deems fit, pursuant to its rights
and remedies described in clause 5.2 of Section 2
in regard to CONTRACTOR'S EQUIPMENT. The cost of
inspection (if any) of the CONTRACTOR's EQUIPMENT
rejected shall be a debt due to the OPERATOR from
the CONTRACTOR.
4.9 prior to the COMMENCEMENT DATE arrange at its
cost and expense for the CONTRACTOR'S in-hole
equipment to be inspected by an independent
tubular inspection service company approved by
OPERATOR and make the certificates of inspection
available to the OPERATOR. The OPERATOR shall
have the right to reject any defective in-hole
equipment so inspected and the CONTRACTOR shall
at its cost and expense repair or replace such
rejected items to the DS-1 appropriate standard,
(DS 1 Level 4 for drill pipe and DS 1 Level 3 - 5
for drill collars and heavy weight drill pipe).
4.10 Arrange thereafter at the cost and expense of the
parties as provided in Attachment 1 to Section 4,
for all items of the CONTRACTOR'S in-hole
equipment to be inspected by an independent
tubular inspection company, approved by the
OPERATOR, at times to be agreed with the
OPERATOR'S REPRESENTATIVE and at intervals as
follows:
(a) Top Drive, saver subs and Bottom Hole
Assembly, comprising drill collars,
Hevi-Wate drill pipe and substitutes, at
intervals of one WELL or more frequently
as found to be necessary by the parties;
(b) Drill pipe and pup joints prior to each
WELL.
In the event of drill string failure during the
aforesaid intervals the CONTRACTOR shall arrange
at its cost and expense for an inspection to be
made, as aforesaid, as soon as possible
thereafter, at a time to be agreed with the
OPERATOR'S REPRESENTATIVE. As a consequence of
the inspection, the CONTRACTOR shall:
EITHER
(i) repair or replace, at its cost and
expense, items rejected as consequence of
such inspection. If in the opinion of the
OPERATOR'S REPRESENTATIVE the rejection of
any item of the CONTRACTOR'S in-hole
equipment jeopardizes the integrity of the
well bore or results in unreasonably slow
progress, then the provisions of clause
5.2 of SECTION 2 (the Conditions of
Contract) shall apply.
OR
(ii) in the event that the CONTRACTOR can
demonstrate, by reference to records or to
the report of an OPERATOR approved
independent company, that the rejection of
any item of the drill string was caused by
6
SECTION 4
STATEMENT OF REQUIREMENTS
PAGE 7 OF 16
================================================================================
either the published performance limits of
the drill string having been exceeded or
by having been exposed to the deleterious
effects of H2S and/or gases or liquids,
during the performance of operations under
this CONTRACT, then the CONTRACTOR shall
repair or replace items rejected and the
OPERATOR shall reimburse the CONTRACTOR
for the cost of any additional inspection
carried out in accordance with the
foregoing and for the costs of repair or
replacement of any item rejected in
accordance with this sub-clause.
For the purpose of this sub-clause,
"inspection" shall include full inspection
to T ▇ ▇▇▇▇ ▇▇-▇ ▇▇▇▇▇ ▇ for drill pipe and
DS-1 Level 3 - 5 for drill collars and heavy
weight drill pipe. Drill collar connections
(over 5" and including tools and subs) to
incorporate stress relief features either
stress relief grooves to API 7 and API RP 7G
or the "Drilco bore back box".
The CONTRACTOR shall make the certificates and
reports of all such inspections available to the
OPERATOR.
4.11 At intervals of not longer than 6 (six) MONTHS
arrange for magnetic particle inspection of its
tongs, elevators, bails, upper string connections
and other lifting equipment to be carried out at
its cost and expense by an independent inspection
company approved by the OPERATOR. The CONTRACTOR
shall make all such inspection reports available
to the OPERATOR and shall replace or repair at
its cost and expense any item so rejected.
4.12 Whenever so requested by the OPERATOR'S
REPRESENTATIVE in writing after the COMMENCEMENT
DATE, and subject to the allocation between
OPERATOR and CONTRACTOR of the costs and expenses
being agreed to by the parties, supply and
deliver to and operate all such further
equipment, materials or modifications to the
CONTRACTOR'S EQUIPMENT as the OPERATOR'S
REPRESENTATIVE may require, which shall then be
listed in SECTION 7 hereof and thereafter be
deemed to be part of the CONTRACTOR'S EQUIPMENT.
4.13 Maintain on board the DRILLING UNIT at all times
the following quantities and sizes of shale
shaker screens:
Scalper Shakers: Min. Max.
---------------- ---- ----
12 mesh square single layer 15 30
20 mesh oblong single layer 20 40
40 mesh oblong single layer 20 40
60 mesh oblong single layer 20 40
80 mesh oblong single layer 20 40
Linear Shakers:
---------------
38 mesh Diamondback Plus 20 40
50 mesh Diamondback Plus 20 40
84 mesh Diamondback Plus 20 40
110 mesh Diamondback Plus 20 40
140 mesh Diamondback Plus 20 40
175 mesh Diamondback Plus 20 40
210 mesh Diamondback Plus 20 40
7
SECTION 4
STATEMENT OF REQUIREMENTS
PAGE 8 OF 16
================================================================================
4.14 Importation and Exportation of CONTRACTOR'S
EQUIPMENT and materials
CONTRACTOR shall comply with OPERATOR's policy on
the importation of machinery, equipment and
materials to be used in OPERATOR's operations
under this CONTRACT as stated in Schedule
4.1.hereto.
CLAUSE 5 SAFETY
5.1 Safety Precautions and Emergency Procedures
(a) The CONTRACTOR shall ensure that an
organisation with defined authority and
responsibility for all matters
associated with the safety of the
DRILLING UNIT and the DRILLING EQUIPMENT
and the safety, health and welfare of
the CONTRACTOR'S PERSONNEL is maintained
throughout the duration of the CONTRACT
within the CONTRACT AREA. The CONTRACTOR
shall appoint and clearly display on
board the DRILLING UNIT the name of the
person who is in overall charge of the
DRILLING UNIT and who shall also be
responsible for all matters related to
the safety, health, welfare and
environment associated with the
CONTRACTOR'S PERSONNEL, the DRILLING
UNIT and its activities.
The procedures for making any change in
the person in overall charge as
aforesaid shall be clearly set out in
the CONTRACTOR'S Operating Procedures
and any change so made shall be recorded
in the logbook of the DRILLING UNIT and
the name of the person in overall charge
so replaced shall immediately be removed
from the place where it was clearly
displayed as aforesaid and the name of
the new person so appointed shall be
substituted.
(b) To the extent that they are neither
inconsistent with nor less stringent
than the CONTRACTOR'S rules, policies
and procedures pertaining to the safety
of CONTRACTOR'S PERSONNEL and the
CONTRACTOR'S EQUIPMENT, the CONTRACTOR
shall observe OPERATOR'S Safety
regulations and comply with rules,
regulations, and codes relating to
equipment, personnel, communications,
supply, transportation and safety
practices as specified by the government
bodies and institutions exercising
jurisdiction in the CONTRACT AREA. The
CONTRACTOR shall use its best efforts to
obtain, if not provided by OPERATOR, and
read and understand such rules and
regulations as aforesaid.
5.2 Blowout and Fire Hazards
(a) The CONTRACTOR shall maintain
certification of well control equipment
and shall maintain said equipment in
good operating condition during
operations hereunder, and shall use all
reasonable means to prevent fire or
blowout and to protect the WELL. The
CONTRACTOR shall deploy the blowout
prevention equipment as instructed by
the OPERATOR on all strings of casing
during the DRILLING SERVICES and shall
keep and maintain such equipment in good
operating condition. The CONTRACTOR
shall examine and test all blowout
prevention devices in accordance with
OPERATOR'S instructions and OPERATOR'S
approved test procedures.
8
SECTION 4
STATEMENT OF REQUIREMENTS
PAGE 9 OF 16
================================================================================
Test results shall be noted on the
relevant test report sheets in addition
to the IADC-API Daily Drilling Report
Form.
The BOP stack and rubbers shall be
inspected by an independent third party
or supplier prior to the COMMENCEMENT
DATE. In the event that the inspection
is satisfactory the BOP shall be tested
to close on a 3 1/2" drill pipe
effectively. If the test is satisfactory
the BOP shall be deemed to be accepted.
If it fails the test then the
replacement parts are to CONTRACTOR'S
account.
In the event that BOP is used for
non-routine work during the CONTRACT,
i.e. well control, stripping through,
then OPERATOR shall pay for replacement
consumable parts as necessary.
(b) In the event of kick, blowout or fire in
any WELL, or if any WELL gets out of
control in any manner, the OPERATOR'S
REPRESENTATIVE shall have the right to
assume complete control and supervise
the work required to regain full control
of the WELL. During such period the
CONTRACTOR shall use its best endeavours
to make its PERSONNEL and services
available at the WELL; if the
CONTRACTOR'S PERSONNEL are not available
during any such period when the OPERATOR
has assumed control the applicable Daily
Rate specified herein shall be reduced
by OPERATOR to reflect any savings made
by the CONTRACTOR.
In the event that a WELL being drilled
hereunder shall blowout or crater, it
is understood and agreed that the
OPERATOR shall bear the entire cost and
expense of killing the WELL or
otherwise bringing it under control.
Subject to the foregoing, all rights
and indemnities otherwise granted
herein shall remain unaffected.
5.3 Safety Management
(a) The CONTRACTOR shall carry out the
DRILLING SERVICES and all other
activities hereunder in a workmanlike
manner with due regard for safety and
shall comply with CONTRACTOR's Safety
Management Systems and OPERATOR's
bridging document. CONTRACTOR shall
make available to the OPERATOR whenever
the OPERATOR may so request, full
documentation to include, but not by
way of limitation, the following
standards, instructions, procedures and
records:
- CONTRACTOR'S Safety Regulations,
- Operating Procedures Manuals
(detailing the operating limits of
the DRILLING UNIT)
- Emergency Procedures Manual,
- Accident Reporting Procedure,
- Work Permit Procedures,
- records of drills, exercises and
safety meetings
- JSAs, Risk Assessments, ASAs, pre-Tour
and Toolbox meetings.
(b) The CONTRACTOR shall designate persons
who shall be responsible for the
operation, maintenance and training of
its PERSONNEL in the use of the fire
9
SECTION 4
STATEMENT OF REQUIREMENTS
PAGE 10 OF 16
================================================================================
control and safety equipment listed in
Group l Section 'O' of Section 7 hereto
and to this end shall arrange for
exercises in DRILLING UNIT firefighting
and evacuation to be carried out
fortnightly by its PERSONNEL on board
the DRILLING UNIT and lifeboat drills
to be carried out by all persons on
board the DRILLING UNIT at weekly
intervals.
Additionally the CONTRACTOR shall
ensure that all its PERSONNEL are
issued with the OPERATOR'S instructions
on safety issued from time to time and
shall use its best endeavours to ensure
that its PERSONNEL comply with such
instructions. CONTRACTOR'S PERSONNEL
shall meet weekly on the DRILLING UNIT
to discuss the matters relating to
safety and at which meetings the
OPERATOR'S REPRESENTATIVE and SERVICE
COMPANY personnel will attend.
The CONTRACTOR shall make available to
the OPERATOR minutes of all such
meetings.
(c) In the event that the CONTRACTOR'S
standards, instructions or procedures
in matters of safety do not exist or
are inadequate or are in any such way
not reasonably acceptable to the
OPERATOR, then the OPERATOR may from
time to time issue such standards,
instructions or procedures as aforesaid
which the CONTRACTOR shall observe and
follow.
(d) The CONTRACTOR shall also provide
OPERATOR with copies of documents
concerning the operational safety of
the DRILLING UNIT including but not by
way of limitation accident reports,
near-miss incidents and permits to
work.
(e) The CONTRACTOR shall maintain an
accurate daily "persons-on-board" list
and next of kin details for all its
PERSONNEL and maintain the list both on
the DRILLING UNIT and at a shore base
agreed between the parties hereto.
(f) The CONTRACTOR shall provide the
OPERATOR with a copy of the CONTRACTORS
Emergency Procedures Manual listing the
responsibilities and procedures in case
of emergency incidents.
5.4 Safety Policies and Reporting
CONTRACTOR agrees to keep open fires and stoves
out of the ▇▇▇▇▇▇▇ and tool houses adjacent to
▇▇▇▇▇▇▇ floor and to prohibit and enforce its
policy against its employees smoking on the rig
floor, under the substructure, mud pit area, and
other areas designated by the OPERATOR'S
REPRESENTATIVE as "No Smoking" areas during the
performance of any work hereunder. Smoking is
prohibited in all areas of the DRILLING UNIT save
the area on the DRILLING UNIT designated as a
Smoking area.
CONTRACTOR also agrees to conform to
recommendation on accident prevention and safe
practices of the International Association of
Drilling Contractors (IADC) and OPERATOR's safety
requirements.
10
SECTION 4
STATEMENT OF REQUIREMENTS
PAGE 11 OF 16
================================================================================
CONTRACTOR shall report all injuries, property
and equipment damage causedby accident
immediately to OPERATOR's REPRESENTATIVE on
board. Within twenty-four (24) hours of
occurrence of the accident CONTRACTOR shall
provide a written report for the OPERATOR's HSE
Manager. A complete accident investigation report
will be submitted within forty-eight (48) hours
of the occurrence.
CONTRACTOR acknowledges it is the policy of the
OPERATOR to achieve and maintain a safe working
environment free from the influence of alcohol
and illicit drugs in order to assure the safety
and protection of its employees, non employees,
operations, assets and the localities in which it
functions. CONTRACTOR will enforce its Drug and
Alcohol Policy with respect to CONTRACTOR'S
PERSONNEL and the personnel of its
SUB-CONTRACTORS, which shall include provision
that the possession, use, distribution or sale of
illicit drugs or controlled substances in the
work place is prohibited and that such personnel
are forbidden from being under the influence of
alcohol while on CONTRACTOR owned, leased or
operated premises. CONTRACTOR agrees to conduct
periodic searches and testing for such
substances. The personnel of the OPERATOR and the
SERVICE COMPANIES shall be subject to the
OPERATOR's Drug and Alcohol Policy.
CONTRACTOR shall submit the following information
on its safety performance each month:
1. Total man hours worked (month/YTD)
2. Total lost time accidents (month/YTD)
3. Total lost time days (month/YTD)
4. Total recordable accidents (month/YTD)
5. Total first aid cases (month/YTD)
CLAUSE 6 CONTRACTOR'S OTHER OBLIGATIONS
6.1 CONTRACTOR not to start DRILLING SERVICES without
Permission
The CONTRACTOR shall not at any LOCATION commence
any DRILLING SERVICES until the OPERATOR'S
REPRESENTATIVE has certified in writing on the
IADC Report Form that the CONTRACTOR'S EQUIPMENT
is acceptable and ready to commence the said
SERVICES.
6.2 Training & Secondment of Nominees of OPERATOR by
CONTRACTOR
The CONTRACTOR hereby undertakes to accept for
training on board the DRILLING UNIT such number
of nominees of OPERATOR as the OPERATOR may
request from time to time and the CONTRACTOR
shall train such nominees as aforesaid in
accordance with such conditions and in such
categories as the OPERATOR may prescribe.
The OPERATOR shall not so request more than five
such local personnel or nominees on board at any
one time.
6.3 CONTRACTOR not to entice
11
SECTION 4
STATEMENT OF REQUIREMENTS
PAGE 12 OF 16
================================================================================
The CONTRACTOR shall not at any time or in any
manner nor for any purpose whatsoever entice
either directly or indirectly any person employed
by the OPERATOR or in the employment of any
SERVICE COMPANY.
6.4 Moving Operations
Before any moving operations are undertaken the
CONTRACTOR shall consult with the OPERATOR upon
weather and other information available at the
time but, notwithstanding Clause 4 of Section 2
of this CONTRACT, the responsibility for the
decision to commence moving operations shall be
the CONTRACTOR'S. Towing vessels provided by the
OPERATOR shall be subject to approval of the
CONTRACTOR. The OPERATOR shall provide to the
CONTRACTOR if so requested the conditions of the
charter party for such towing operations.
6.5 Inspection of CONTRACT AREA
The CONTRACTOR shall be deemed to be satisfied as
to the nature of all existing harbours and means
of transport or communication on the mainland of
the CONTRACT AREA, and as to possible
interruptions thereto and as to access to and
from the CONTRACT AREA; to have made enquiries,
examined and satisfied itself as to workyard
sites and such depots and buildings as may be
required for carrying out its obligations under
the CONTRACT; to have made local and independent
enquiries as to storms, prevailing winds and
climatic considerations generally and other
similar matters; to be satisfied as to the
sources and means of obtaining adequate supplies
of skilled and unskilled persons and all other
things required for carrying out the CONTRACT; to
have considered the possible effects on the
carrying out of the CONTRACT that may be caused
by the break down of communications or by reason
of storms, prevailing winds and adverse climatic
weather conditions which may arise at any time
during the continuance of the CONTRACT within the
CONTRACT AREA; to have examined the CONTRACT
generally and to have obtained all necessary
information on all matters whatsoever which may
effect its performance thereof.
In the event that the CONTRACTOR does not satisfy
itself on any of such matters as aforesaid this
shall not relieve it from its obligations
hereunder and shall not entitle it to any
increase in any rate or charge under the CONTRACT
nor to any compensation or amount whatsoever
additional to such charges, and in the event of
any claim under the CONTRACT or law being made by
any party the CONTRACTOR shall be deemed to have
so visited, examined and satisfied itself as
aforesaid prior to the date hereof.
CLAUSE 7 RESPONSIBILITIES OF THE OPERATOR
The OPERATOR shall provide the following equipment,
materials, supplies spare parts, services and personnel at
its cost and expense unless stated otherwise.
7.1. PERSONNEL
12
SECTION 4
STATEMENT OF REQUIREMENTS
PAGE 13 OF 16
================================================================================
1. The OPERATOR'S REPRESENTATIVE and
persons delegated by the OPERATOR to act
on behalf of the OPERATOR'S
REPRESENTATIVE from time to time.
2. The OPERATOR'S technical specialists.
7.2. SERVICES AND EQUIPMENT
1. Specialist services.
2. Emergency medical evacuation services as
available (on cost recoverable basis
within the scope of CONTRACTOR'S
insurances at OPERATOR'S option).
3a. Towing and positioning services in the
CONTRACT AREA between LOCATIONs.
3b. Towing Services to an acceptable port at
the conclusion of the DRILLING SERVICES.
4. Workboat supply service for all
materials and a standby/workboat
service.
5. Transport for CONTRACTOR'S PERSONNEL and
SUB-CONTRACTOR'S personnel between
OPERATOR'S designated point of
embarkation on the mainland of the
CONTRACT AREA and the DRILLING UNIT and
between the OPERATOR'S point of
embarkation in the Republic of Trinidad
and Tobago and the mainland of the
CONTRACT AREA for the purposes of
routine crew change.
In the event that crew changes are
delayed for reasons of weather or
non-availability of helicopter or damage
to DRILLING UNIT which prevents a
helicopter from landing, CONTRACTOR will
arrange and OPERATOR will pay reasonable
overnight hotel accommodation and meal
costs and substantiated overtime costs.
6. Offshore drilling permit(s).
7. Drilling site surveys, buoying and
clearing of obstructions.
8. All marine and air transport of
CONTRACTOR'S and OPERATOR'S items
between OPERATOR'S designated marine and
air supply bases and the DRILLING UNIT.
OPERATOR shall select type of transport.
9. All cementing services.
10. Mud engineer if required by OPERATOR
(but CONTRACTOR will carry out routine
mud testing and treatment).
11. Mud logging service, if required by
OPERATOR.
12. Geological services.
13
SECTION 4
STATEMENT OF REQUIREMENTS
PAGE 14 OF 16
================================================================================
13. Directional drilling service engineer
and directional drilling equipment if
required by OPERATOR.
14. Drilling water if required, except that
CONTRACTOR'S water making unit can be
used in cases of emergency.
15. Bits and other downhole tools not
supplied by CONTRACTOR and listed in
SECTION 7.
16. Conductor pipe, casing, tubing and
attachments, drive hammer, and all
related handling tools.
17. Wellhead housings, casing hangers, seat
protectors, pack-offs, wear bushings,
corrosion cap and all associated running
tools.
18. Temporary and Permanent Guide Bases
19. Cement and additives.
20. Mud chemicals and mud additives,
including pallets if required by
OPERATOR.
21. Diesel fuel for use on the DRILLING
UNIT.
22. Well test unit and associated equipment
for production testing, including
Separators and other test vessels.
23. Drill pipe and drill collars, Kellys or
subs other than those listed in SECTION
7.
24. Stabilizers, hole openers, reamers and
centralizers other than those listed in
SECTION 7.
25. Drill stem testing equipment.
26. Radio equipment other than that listed
in SECTION 7.
27. Loading and unloading services at
supply/ load out bases or heliport of
all material and equipment of CONTRACTOR
and OPERATOR.
28. Containers for disposal of refuse as
well as transport to shore and disposal
of same, except for liquid waste
generated by CONTRACTOR.
29. Crude oil burner assemblies unless
supplied by CONTRACTOR and listed under
SECTION 7.
30. Navigation and positioning systems for
siting the DRILLING UNIT.
31. Diving and ROV Services if required
by OPERATOR.
32. Potable Water in excess of water
provided by the desalination unit on
board the DRILLING UNIT.
33. Fishing Tools.
14
SCHEDULE 4.1 TO SECTION 4
STATEMENT OF REQUIREMENTS
PAGE 1 OF 2
================================================================================
SCHEDULE 4.1.
OPERATOR'S POLICY ON IMPORTATION OF MACHINERY, EQUIPMENT, & MATERIALS
---------------------------------------------------------------------
CONTRACTOR shall comply with the provisions of OPERATOR's general policy on the
importation of machinery, equipment, and materials by CONTRACTOR for use in
OPERATOR's operations, specifically with respect to the procedure for Exemption
from Customs Duty on Bills of Entry as set forth below.
PROCEDURE
---------
EXEMPTION FROM CUSTOMS DUTY ON BILLS OF ENTRY
---------------------------------------------
1. Introduction
------------
Goods imported into Trinidad and Tobago are generally subject to customs
duty at rates prescribed by tariff, and to Value Added Tax (VAT). The
Customs Act (Act) provides for a total (or partial exemption as the case
may be) exemption from such duty in respect of: (a) goods imported for
temporary use and which are to be subsequently re-exported, and (b) such
goods specified in the Third Schedule of the Act, which in any particular
case are exempted by Order of the Minister responsible for Industry.
Included among the goods generally qualifying for exemption are those
items of machinery, equipment, and materials for exploration and
extraction of minerals, including natural gas.
2. General
-------
In order to make use of the exemptions granted, the following procedure
is to be used when machinery, equipment, or materials are being imported
into Trinidad and Tobago by CONTRACTOR:
a. In the case of items being imported for a short time to perform a
particular job and then be re-exported, these items should be
imported under the exemption for goods imported for temporary use.
b. In the case of all other items being imported by CONTRACTOR
(including any consumables which must be imported while operations
are in progress and which are going to be used up in Trinidad and
Tobago and, as far as legally possible, subsequent spare parts for
equipment, machinery, etc., previously imported into Trinidad and
Tobago), these items should be imported under a Minister's License.
For the purpose of OPERATOR obtaining a Minister's License,
CONTRACTOR must submit full details of the goods to be imported to
OPERATOR well in advance of the date of importation, and the goods
are not to be landed in Trinidad and Tobago unless previously
authorised by OPERATOR.
If after OPERATOR has cleared CONTRACTOR's equipment and supplies
into Trinidad and Tobago, CONTRACTOR desires to import additional
material, equipment, supplies, tools, and other items for use in the
Work, OPERATOR will endeavour to assist CONTRACTOR in such
importation subject to Section 2 Clause 22 of the CONTRACT.
c. In no circumstance whatsoever are any goods which have been imported
under a Minister's License granted to OPERATOR be subchartered,
loaned, sold, or otherwise disposed of to any other OPERATOR or
person in Trinidad and Tobago without the prior written authorisation
of the appropriate OPERATOR's Business Unit Leader. Each case will
have to be discussed with Government of the Republic of Trinidad and
Tobago ("GORTT") authorities to determine proper procedure.
ATTACHMENT 1
TO
SECTION 4
CHECKLIST OF RESPONSIBILITIES
JACKUP
CHECK LIST OF RESPONSIBILITIES FOR SERVICES AND MATERIALS
PROVIDED BY OPERATOR (O) AND THE CONTRACTOR (C)
ATTACHMENT 1 TO SECTION 4
CHECKLIST OF RESPONSIBILITIES
PAGE 1 OF 9
================================================================================
A. DRILLING LOCATION
------------- -------------
Provided By To Account
------------- -------------
1. Licences and consents to perform the
operations, including suspension or abandonment. O O
2. LOCATION survey to include marker buoys and side O O
scan sonar, and soil borings.
3. Rig positioning services including Satnav. O O
4. Insurance underwriter representatives. C C
------------- -------------
B. TRANSPORTATION/HANDLING
------------- -------------
Provided By To Account
------------- -------------
1. Helicopter or Marine transportation including emergency
transportation for all personnel between designated point of
embarkation and the DRILLING UNIT. O O
2. Marine transportation for equipment and spare parts between the
OPERATOR'S shore base and the DRILLING UNIT. O O
3. Transportation of CONTRACTOR'S PERSONNEL and SUB-CONTRACTOR'S
personnel to and from the point of embarkation designated by the
OPERATOR and the CONTRACTOR'S base of operations or personnel's
point of origin. C C
4. Immigration clearance for CONTRACTOR'S PERSONNEL and
SUB-CONTRACTORS' PERSONNEL C C
5. In the event crew changes are delayed for reasons set out in
sub-clause 7.2.5 of SECTION 4 for overnight hotel accommodation and
meal costs including any overtime charges
C O
6. Transportation of CONTRACTOR'S EQUIPMENT between the OPERATOR'S
shore base or heliport and CONTRACTOR'S shore base
C C
7. Dock and dockside facilities, labour and equipment for
loading/unloading the OPERATOR'S MATERIALS or CONTRACTOR'S EQUIPMENT
at the OPERATOR'S shore base (to include in storage).
O O
------------- -------------
ATTACHMENT 1 TO SECTION 4
CHECKLIST OF RESPONSIBILITIES
PAGE 2 OF 9
================================================================================
B. TRANSPORTATION/HANDLING (CONT'D)
------------- -------------
Provided By To Account
------------- -------------
8. Offloading facilities to transfer personnel and cargo from the
OPERATOR'S supply vessel onto the DRILLING UNIT. No CONTRACTOR'S
PERSONNEL or SUB-CONTRACTOR'S personnel will be to go on board the
supply vessel for the purpose of loading or offloading cargo. C C
9. Tie up lines for mooring supply vessel to the DRILLING UNIT
4" medium lay, 120-150 ft.
First set
Replacement set(s) C C
C O
10a. Floating Hoses and couplings for transfer of bulk and liquid
materials between supply vessels and the DRILLING UNIT.
First Set C C
Replacement sets C O
10b. Check valve on hoses at both ends C O
11. a. Transportation and containers for disposing of waste,
contaminated cuttings and fluids required. O O
b. Containers for disposal of CONTRACTOR's liquid hazardous
waste C C
12. Qualified and competent offshore radio and computer operator for 24
hour duty (trained for MAPS) C C
13. Communications equipment (including satellite communication
equipment) required for use on the DRILLING UNIT for communication
with OPERATOR'S shore base (OPERATOR to pay for satellite calls made
by or on behalf of OPERATOR)
6 handheld radios with handsfree headsets
4 handheld radios with handsfree headsets C C
C O
14. Standby Vessel O O
15. Fenders for DRILLING UNIT C C
------------- -------------
2
ATTACHMENT 1 TO SECTION 4
CHECKLIST OF RESPONSIBILITIES
PAGE 3 OF 9
================================================================================
C. SHORE BASE USED BY THE CONTRACTOR
------------- -------------
Provided By To Account
------------- -------------
1. Office, warehouse and storage facilities CONTRACTOR'S EQUIPMENT and
CONTRACTOR'S PERSONNEL C C
Note: CONTRACTOR'S shore base shall be as close as possible to the
OPERATOR'S shore base
------------- -------------
D. DRY DOCKING/CERTIFICATION
------------- -------------
Provided By To Account
------------- -------------
1. For time in dock for statutory testing inspections or trials (but
excluding moving time) C C
2. Port fees, taxes, licences, import tariffs, pilotage fees, wharfage
fees canal fees and cost of similar charges including any brokerage
fees in respect of CONTRACTOR'S EQUIPMENT C C
3. Customs Duties, import tariffs in respect of Trinidad and Tobago O O
Regulations
------------- -------------
E. THIRD PARTY SERVICES
------------- -------------
Provided By To Account
------------- -------------
1. Diving equipment services and installation costs and R.O.V. O O
2. Drill stem testing tools and services O O
3. Electric well logging equipment and services O O
4. Mud logging equipment and services O O
5. Mud engineering services and supervision O O
6. Geological/mud laboratory and test equipment O O
7. Acidizing, fracturing and other specialist services O O
8. Directional drilling equipment and services O O
9. Cementing services using cementing unit provided on a "free
placement" basis O O
9a Maintenance of cementing unit if provided by CONTRACTOR C C
9b Maintenance of cementing unit if provided by OPERATOR O O
------------- -------------
3
ATTACHMENT 1 TO SECTION 4
CHECKLIST OF RESPONSIBILITIES
PAGE 4 OF 9
================================================================================
E. THIRD PARTY SERVICES (CONT'D)
------------- -------------
Provided By To Account
------------- -------------
10. Coring Services and equipment O O
11. Tubing and casing running services O O
12. Extra welders and welding material used on welding and cutting the
OPERATOR'S equipment as authorised by the OPERATOR C O
13. Well completion services O O
14. Well test equipment and services O O
15. Weather forecasting and reporting services O O
16. Specialist services and equipment not designated herein but required
for the operations O O
17. Inspection of Top Drive, drill pipe, drill collars, other in-hole
equipment as per Clause 4.10 SECTION 4.
- Initial C C
- Other and Routine C O
18 Space, assistance and services for SERVICE COMPANY personnel and
equipment C C
------------- -------------
F. MATERIALS AND SUPPLIES
------------- -------------
Provided By To Account
------------- -------------
1. Cement and cement additives O O
2. Mud chemicals and completion fluids O O
3. Fuel for DRILLING UNIT O O
4. Lubes for DRILLING UNIT C C
5. Casing and tubing dope (to be specified by OPERATOR) O O
------------- -------------
4
ATTACHMENT 1 TO SECTION 4
CHECKLIST OF RESPONSIBILITIES
PAGE 5 OF 9
================================================================================
F. MATERIALS AND SUPPLIES (CONT'D)
------------- -------------
Provided By To Account
------------- -------------
6. Grease, pipe dope (friction factor 1 pipe dope) and lubricants
(other than 4. above) for equipment supplied by CONTRACTOR C C
7. Hydraulic fluid for blow-out preventers and control unit C C
8. Drilling Water O O
9. Potable water in excess of rated production capacity of water
distillation unit installed on board. O O
10. Drilling bits, diamond bits, and core heads O O
11. Shale shaker screens (Refer Section 4, Clause 4.13) C C
12. Repair and replacement parts for safety joint fishing jars and
fishing tools, resulting from" in-hole" damage O O
13. Casing protectors for drill pipe
- initial set C C
- replacement set(s) C O
14. BOP and riser consumables C O
15. Repair kits for: float valves, ▇▇▇▇▇ ▇▇▇▇▇ (upper and lower) and
inside BOP's C C
------------- -------------
G. DRILLING EQUIPMENT AND UNIT
------------- -------------
Provided By To Account
------------- -------------
1. CONTRACTOR'S EQUIPMENT C C
2. Fishing tools for CONTRACTOR's In Hole Equipment O O
3. Tubing O O
4. Tubing handling equipment O O
5. 3.1/2" drill pipe including drill collars and handling tools. (If
specified by OPERATOR). O O
6. Cementing heads O O
5
ATTACHMENT 1 TO SECTION 4
CHECKLIST OF RESPONSIBILITIES
PAGE 6 OF 9
================================================================================
G. DRILLING EQUIPMENT AND UNIT (CONT`D)
------------- -------------
Provided By To Account
------------- -------------
7. 2 sets Elevators, tongs and handling tools for 30", 20"16", 113/4",
13 3/8", 9 5/8" and 7" casing (As specified in Section 7 Part 2 only) O O
8. Drilling Jars O O
9. 36" and 26" Hole openers c/w spare cutters O O
9a. Reamers and stabilisers O O
10. Drill pipe wipers C C
11. Fishing tools other than those described in 2 above O O
12. Casing cutters & casing spears O O
13. Casing power tongs and hydraulic power unit O O
14. Replacement and/or repair of any equipment when lost or damaged
below the rotary table other than arising out of fair wear and tear. C O
15. Mud pump fluid and power end parts and consumables
Liner Sizes of 6" and 7" required C C
Mud pump fluid and power end parts and consumables C O
Liner Sizes of 5 1/2" required
16. Spares for choke manifold C C
17. Replacement of tubulars after inspection pursuant to SECTION 4
Clause 4.10 hereof C C
20. Maintenance and spare parts for all CONTRACTOR'S EQUIPMENT unless
otherwise provided herein C C
------------- -------------
6
ATTACHMENT 1 TO SECTION 4
CHECKLIST OF RESPONSIBILITIES
PAGE 7 OF 9
================================================================================
H. WELL EQUIPMENT
------------- -------------
Provided By To Account
------------- -------------
1. All tubular goods, including conductor pipe, casing and tubing O O
2. Casing shoes, collars, baskets, centralisers float equipment,
baffles, scratchers and all other such in-hole consumables O O
3. Wellhead housings including casing hangers wear bushings and all
such associated wellhead equipment. O O
4. Valves, Xmas Trees and necessary tools and equipment for installation
O O
5. All running and pressure testing tools for wellhead equipment
supplied by the OPERATOR O O
6. Replacement and repair and all consumables for items provided under
5 above O O
7. Wellhead ring joint gaskets, other than those required for
installation between items of the CONTRACTOR'S EQUIPMENT C O
8. Permanent and Temporary Guide Bases O O
------------- -------------
I. SAFETY
------------- -------------
Provided By To Account
------------- -------------
1. Radio equipment for communication with tugs, supply vessels and
helicopters including portable sets (See B. 13.) C C
2. Permits, licences required for operation of communication equipment. C C
3. First aid, infirmary, equipment and medical attention on board the
DRILLING UNIT for all persons while on board C C
3a Paramedic on board the DRILLING UNIT (to be specified by OPERATOR,
refer ▇▇▇▇▇▇▇ ▇, ▇▇▇▇▇▇ ▇.▇) ▇ ▇
▇▇ ▇▇▇ (▇▇▇ ▇▇▇▇▇) on board the DRILLING UNIT (refer SECTION 4, Clause C C
3.6)
------------- -------------
7
ATTACHMENT 1 TO SECTION 4
CHECKLIST OF RESPONSIBILITIES
PAGE 8 OF 9
================================================================================
I. SAFETY
------------- -------------
Provided By To Account
------------- -------------
4. Safety hats, safety boots, safety glasses, hearing protection, fire
resistant clothing (Nomex), HLO fire resistant suit and gloves for C C
CONTRACTOR'S PERSONNEL and SUB-CONTRACTOR'S Personnel
4a PPE for synthetic oil-based muds and brine C O
5. Fire fighting equipment as required to comply with the OPERATOR'S
and government regulations C C
6. Onshore medical services for CONTRACTOR'S and SUB-CONTRACTOR'S
personnel C C
7. Refuelling system on the DRILLING UNIT for helicopter fuel, when O O
requested by OPERATOR.
8. Helicopter refuelling inspection kits and filters C C
9. All necessary life saving and safety equipment to conform with
regulations and requirements of the LAW and OPERATOR C C
10 Fluorescent vest for HLO and banks men C C
------------- -------------
J. MISCELLANEOUS
------------- -------------
Provided By To Account
------------- -------------
1. Helicopter deck as required by government regulations and to
accommodate Super Puma helicopter or similar C C
2. All hand and power tools required for normal maintenance of the
DRILLING UNIT C C
3. Office on the DRILLING UNIT for the OPERATOR'S Drilling Supervisors
C C
4. Catering on board for all CONTRACTOR'S and SUB-CONTRACTOR'S
personnel, plus 16 OPERATOR'S personnel or SERVICE COMPANY PERSONNEL
C C
5. Catering for all OPERATOR and SERVICE COMPANY PERSONNEL in excess of
above at cost C O
6. Subsea T.V. System O O
7. Replacement parts to Subsea T.V. System O O
------------- -------------
8
ATTACHMENT 1 TO SECTION 4
CHECKLIST OF RESPONSIBILITIES
PAGE 9 OF 9
================================================================================
J. MISCELLANEOUS (CONT'D)
------------- -------------
Provided By To Account
------------- -------------
8. On board entertainment, video, films, satellite TV. C C
9. CONTRACTOR'S PERSONNEL and SUB-CONTRACTOR'S PERSONNEL
C C
10. Additional personnel as requested by the OPERATOR employed by
CONTRACTOR C O
11. Overtime for CONTRACTOR'S PERSONNEL authorised by the OPERATOR in
writing C O
12. Survival Suits for use during helicopter flights for CONTRACTOR'S
personnel and CONTRACTORS Service personnel O O
13. Waste disposal onshore O O
14. Cargo baskets and containers for equipment supplied by OPERATOR O O
15. Mud laboratory test equipment for routine and testing and treatment.
(See sub-clause 4.8.2 para 10). O O
16. Replacement of additional anchors, buoys and pennant wire C C
17. Burners O O
------------- -------------
K. THE VESSEL
------------- -------------
Provided By To Account
------------- -------------
1. Damage to or loss of DRILLING UNIT: C C
Inspection C C
Repairs C C
Replacement C C
------------- -------------
9
ATTACHMENT 2
TO
SECTION 4
REPORTING RESPONSIBILITIES OF THE CONTRACTOR
The following forms and reports shall be completed by the CONTRACTOR and handed
over to the OPERATOR.
1. The Daily IADC Tour Sheet
2. Morning drilling report
3. Drilling Parameters Record Charts (Drilling Recorder)
4. Pit Level Indicator Chart
5. Loading Notes and/or cargo manifests
6. Drilling Unit & Drilling Equipment Inspection (a) Safety
(b) General
7. Testing of B.O.P. Equipment and Charted
8. Accident/Near Miss Report
9. Time Breakdown Report
10. Bed/Meal Tickets
11. Minutes of Safety Meetings
12. Barge Engineer's Report
13. Trip Sheet
14. Trend indication while drilling - Torque and Drag and Pump Pressure
15. Bottom Hole Assembly and Diagrams
16. Circulating time on jars and thrusters
17. Environment Emission Report
G.1 THE DAILY TOUR SHEET
The Daily IADC Tour Sheet will be comprehensively filled in by the
Drillers, checked on the DRILLING UNIT by the CONTRACTOR'S Toolpusher
and by the OPERATOR'S REPRESENTATIVE or, by the latter's delegation,
another OPERATOR'S Supervisor on board. Both the said Toolpusher and
the OPERATOR'S REPRESENTATIVE on the DRILLING UNIT will sign the Daily
Tour Sheet.
G.2 THE MORNING DRILLING REPORT
This report shall be filled in every morning on the DRILLING UNIT by
the OPERATOR'S Drilling Supervisor assisted by the CONTRACTOR'S
Toolpusher. It shall contain a summary of the previous day's operations
and shall be transmitted each morning at an agreed time to the
OPERATOR'S onshore office.
G.3 DRILLING PARAMETERS RECORD CHARTS (DRILLING RECORDER)
The main drilling parameters i.e. weight on bit, pump pressure, pump
strokes per minute, R.O.P., rotary torque, R.P.M., will be recorded on
a single chart. In the event of any failure of the Drilling Parameters
Recorder the CONTRACTOR will give immediate notice to the OPERATOR'S
REPRESENTATIVE of such failure. The OPERATOR'S Drilling Supervisor will
be responsible for collecting the charts and sending them to the
OPERATOR'S Office (Drilling Department).
G.4 PIT LEVEL INDICATOR
This recorder shall always be connected during all operations from spud
to release.
ATTACHMENT 2TO SECTION 4
REPORTING RESPONSIBILITIES OF THE CONTRACTOR
PAGE 2 OF 3
================================================================================
The CONTRACTOR will give immediate notice to the OPERATOR'S Drilling
Supervisor of any failure of the Pit Level Indicator. The OPERATOR'S
Drilling Supervisor will be responsible for collecting the charts and
sending them to the OPERATOR'S Office (Drilling Department).
MUD REPORT (Prepared by OPERATOR)
The OPERATOR'S mud engineer will prepare a complete mud report for
every WELL; this mud report will consist of:
1 Daily Mud Report
2 End of Phase Mud Report
3 Mud Material used and transferred
4 Usage and Cost per Interval
G.5 LOADING NOTES
The CONTRACTOR shall prepare Loading Notes in respect of such of
OPERATOR'S MATERIALS as are consigned to the OPERATOR from the DRILLING
UNIT, and shall check receipts of such MATERIALS at the DRILLING UNIT
against the Loading Note prepared by the OPERATOR or its SERVICE
COMPANY and advise the OPERATOR'S REPRESENTATIVE forthwith of any
discrepancies therein.
G.6 BED/MEAL TICKETS
Any invoice sent to the OPERATOR in respect of beds or meals taken by
the OPERATOR'S PERSONNEL or the SERVICE COMPANY PERSONNEL on the
DRILLING UNIT shall be substantiated by daily vouchers clearly and
properly completed by the CONTRACTOR and countersigned by OPERATOR'S
Drilling Supervisor.
G.7 DRILLING UNIT AND DRILLING EQUIPMENT INSPECTION
(a) SAFETY
(b) GENERAL
Inspection shall be carried out as directed by the CONTRACTOR's Rig
Manager. After the OPERATOR'S Drilling Supervisor and the CONTRACTOR'S
Rig Manager have conducted such inspections, the inspection forms shall
be completed by the said Rig Manager in the presence of the said
OPERATOR's Drilling Supervisor and signed by both parties.
G.8 PERIODIC TESTING OF B.O.P. EQUIPMENT
Testing of the Blowout Preventers and associated equipment shall take
place as directed by the OPERATOR'S Drilling Supervisor. The
CONTRACTOR'S Toolpusher and OPERATOR's Drilling Supervisor shall sign
the form after it has been completed by the CONTRACTOR's Engineer.
G.9 ACCIDENT/NEAR MISS REPORTS
Whenever an accident or near miss occurs (as defined below) the
CONTRACTOR shall immediately notify the OPERATOR'S REPRESENTATIVE and
as soon as possible thereafter deliver to the said REPRESENTATIVE an
2
ATTACHMENT 2TO SECTION 4
REPORTING RESPONSIBILITIES OF THE CONTRACTOR
PAGE 3 OF 3
================================================================================
Incident Report on a form to be provided by the OPERATOR and completed
by the CONTRACTOR.
An accident is defined as an undesired event that results in harm to
people, damage to property or loss to process. This includes all
security accidents.
A near miss is defined as an undesired event, which, although not
actually resulting in loss, could have resulted, under slightly
different circumstances, in harm to people, damage to property or loss
to process.
G.10 TIME BREAKDOWN REPORT
This form shall be filled in by the OPERATOR'S Drilling Supervisor on
the DRILLING UNIT. There will be one such form per month per WELL.
The Time Breakdown Report shall be signed by the CONTRACTOR'S
REPRESENTATIVE and the OPERATOR'S Drilling Supervisor at a convenient
time following the end of each WELL and/or each month. The time
breakdown will be agreed by both parties before any invoice is
presented to OPERATOR.
G.11 MINUTES OF SAFETY MEETINGS
Minutes of Safety Meetings shall be supplied by CONTRACTOR to the
OPERATOR for all Safety Meetings carried out on board the DRILLING
UNIT. The CONTRACTOR shall sign the minutes as being correct and
accurate.
G.12 BARGE ENGINEER'S REPORT
Daily report on usage of bulk, fuel, water, liquid muds, helicopter
fuel, anchor tension, environmental conditions and variable deckload.
G.13 TRIP SHEET REPORT
G.17 EMISSION REPORT
To be completed monthly and sent to the OPERATOR's HSE Department.
3
SECTION 5
RATES AND CHARGES
PREAMBLES
5.1 GENERAL
The Rates and Charges shall be fully inclusive of all costs, expenses,
overheads and profit arising out of the provision of the DRILLING
SERVICES, PERSONNEL and EQUIPMENT set out in Sections 1,2,3,4,6 and 7
hereof.
5.2 MOBILISATION AND DEMOBILISATION
(a) MOBILISATION CHARGE shall be the amount payable for the
MOBILISATION of the CONTRACTOR'S EQUIPMENT and CONTRACTOR'S
PERSONNEL to the first drilling LOCATION in the CONTRACT AREA
including
- setting up a base in the CONTRACT AREA
- towage,
- air passages,
- sea freight,
- lighterage,
- port dues,
- pilotage,
- wharfage,
- cranage,
- cargo handling,
until the agreed time and date that the legs are pinned at the
first LOCATION.
Any time in excess of twenty-four (24) hours waiting on
weather in the CONTRACT AREA shall be paid to CONTRACTOR at
the Standby Rate.
(b) DEMOBILISATION CHARGE shall be the amount payable for the
DEMOBILISATION of the CONTRACTOR'S EQUIPMENT and CONTRACTOR'S
PERSONNEL from a mutually agreed port in the CONTRACT AREA
including
- closing down a base in the CONTRACT AREA,
- towage,
- air passages,
- sea freight,
- lighterage,
- port dues,
- pilotage,
- wharfage,
- cranage,
- cargo handling,
from the time the DRILLING UNIT is under tight tow from the
mutually agreed port. Unloading of OPERATOR'S MATERIALS and
SERVICE COMPANY equipment and materials at the Republic of
Trinidad and Tobago or such other designated location shall be
reimbursed at the DEPROVISIONING RATE.
SECTION 5
RATES AND CHARGES
PAGE 2 OF 7
================================================================================
Should the CONTRACTOR have continuing work for another
operator in the waters of Trinidad and Tobago, or if another
operator is paying for mobilization of the DRILLING UNIT from
the waters of Trinidad and Tobago the DRILLING UNIT may, with
the OPERATOR'S agreement, be left on the last LOCATION and the
OPERATOR shall pay NIL rate. In such case the DEMOBILISATION
CHARGE shall not apply. NIL rate shall apply if the move is
delayed by the other operator.
(c) Standing Down/Re-mobilisation Charge
The CONTRACTOR will be paid a reimbursement for all actual
costs reasonably and properly incurred by the CONTRACTOR in
standing down at a port on the mainland of the CONTRACT AREA
nominated by the OPERATOR, or, at the OPERATOR'S option, at
the individual home bases of the CONTRACTOR'S PERSONNEL, and
(as the case may be) in demobilising from said port or home
bases the CONTRACTOR'S PERSONNEL as a direct consequence of
the DRILLING UNIT being shutdown by reason of Force Majeure.
Full supporting documents must accompany any invoice for this
charge.
5.3 DAILY RATES
All rates per day described hereunder refer to a day of 24 hours. For
parts of a day all such daily rates shall be prorated to the nearest
one-quarter hour.
(a) The OPERATING RATE shall be the amount per day payable for the
normal performance of the DRILLING SERVICES. The OPERATING
RATE shall apply for normal operations from the COMMENCEMENT
DATE until the DRILLING UNIT arrives at the mutually agreed
port at the end of the term of the CONTRACT and all OPERATOR'S
and SERVICE COMPANY equipment has been offloaded.
The OPERATING RATE shall not apply during provisioning,
deprovisioning, stand-by, moving, or during any periods of
shut down however caused.
In particular shutdown for revalidation of CERTIFICATION,
compliance with regulations, or rejection of equipment shall
be payable at nil rate.
Cessation of operations in order to slip, cut or change the
drilling line, or routine lubrication for routine maintenance
purposes as further described in clause 5.3(e) of this Section
5,up to 1/2 hour per shift per day, which cannot be safely and
properly carried out without suspending the DRILLING SERVICES
shall not be deemed to be shut down for the purposes of this
sub-clause.
The OPERATING RATE shall apply in a similar manner at each
subsequent LOCATION.
(b) The PROVISIONING RATE/ DEPROVISIONING RATE shall be the amount
per day applicable when the DRILLING UNIT is moored at
anchorage or alongside a suitable quay in Pascagoula,
Mississippi and the Republic of Trinidad and Tobago or such
other designated location and the OPERATOR'S MATERIALS and
SERVICE COMPANY EQUIPMENT are being loaded/ unloaded. The
PROVISIONING RATE/ DEPROVISIONING RATE shall apply for such
period in excess of fourteen (14) days for the Make Ready
period described in Section 1, Clause 6.3.
2
SECTION 5
RATES AND CHARGES
PAGE 3 OF 7
================================================================================
(c) The STANDBY RATE shall be the amount per day applicable when
the DRILLING UNIT is fully manned and in a state of readiness
to start or resume operations, during any period of delay or
suspension of operations on account of
- adverse sea or weather conditions
- waiting on OPERATOR'S orders or on OPERATOR'S
MATERIALS or on SERVICE COMPANIES
- during wireline logging operations from the time the
first logging tool passes through the rotary table
until the last tool of the logging suite is retrieved
through the rotary table
- failure of equipment provided by the OPERATOR or the
SERVICE COMPANIES
- any act or omission of OPERATOR or its SERVICE
COMPANIES,
until such time as operations are resumed.
During such Standby the CONTRACTOR may, subject to the
agreement of the OPERATOR, carry out maintenance or repairs to
the CONTRACTOR'S EQUIPMENT.
In the event the CONTRACTOR is unable to ▇▇▇▇ up at the first
LOCATION on account of weather conditions only, then the
STANDBY RATE shall apply after twenty-four (24) hours from
arrival of the DRILLING UNIT in the CONTRACT AREA. .
(d) The MOVING RATE shall be the amount per day which shall apply
from the time the DRILLING UNIT is under tight tow on
completion of the WELL at the first LOCATION until the legs
are pinned at the next LOCATION and similarly at subsequent
LOCATIONS thereafter.
(e) The REPAIR RATE shall be applicable during such times as there
is a shutdown in operations for repairs to the DRILLING
EQUIPMENT in the manner set out below:
- REPAIR RATE applies for a cumulative ten (10) hours per MONTH
shut down, unless such shutdown is for repairs not reasonably
within the control of CONTRACTOR, in which case the REPAIR
RATE shall be applicable for a cumulative thirty-six (36)
hours per month, and
- thereafter at NIL Rate.
In the event that any such shutdown which is caused by or
arises from the same incident shall continue from one month
into the next, then for the purposes of this sub-clause the
incident shall be treated as though it occurred in the same
month.
For cumulative downtime less than ten (10) hours per calendar
month, CONTRACTOR shall earn the incentive payment specified
in Schedule 5.1.
Downtime for the following instances shall be considered
normal drilling operations and shall not be considered as
repair time:
3
SECTION 5
RATES AND CHARGES
PAGE 4 OF 7
================================================================================
Industry standard thirty minutes rig service per tour
including, but not limited to, inspection of equipment,
lubrication, repacking swivel or top drive, slipping and/or
cutting drilling line, changing pump liners or swabs and
routine top drive service.
(f) The REDRILLING RATE being 75 percent of the OPERATING RATE
shall apply during all time spent in redrilling the hole or
during remedial work on the hole due to circumstances set out
in Clause 6.4 of the Conditions of Contract.
(g) The FISHING RATE being the amount per day applicable during
all times when fishing operations (or sidetracking operations
arising out of fish in the hole) are being carried out,
starting from the time that normal drilling operations are
interrupted on account of the need to begin fishing operations
and continuing until such time as normal drilling operations
are resumed. The Rate for all such fishing or sidetracking
operations shall be either the OPERATING RATE or, in the event
such operations are due to or arise out of the negligence of
the CONTRACTOR or its PERSONNEL then the rate shall be 75% of
the OPERATING RATE. In the event that sidetracking operations
are being carried out at 75% of the OPERATING RATE then normal
drilling operations shall be deemed to have been resumed when
the depth is reached at which the said fishing operations
occurred in the first place. 'Fishing operations' shall be
deemed to include all operations incurred in attempting to
remove a fish from the WELL or to push a fish to one side or
to pick up a fish.
(h) The SHUTDOWN WITH CREW RATE being the amount per day quoted in
Schedule 5.1 which shall apply during all such time as the
DRILLING UNIT has been shutdown and the DRILLING SERVICES have
been suspended for any reason by the OPERATOR. The Rate shall
include the CONTRACTOR'S costs in maintaining its PERSONNEL
and of protective maintenance at the DRILLING UNIT.
(i) The SHUTDOWN WITHOUT CREW RATE being the amount per day of the
SHUTDOWN WITH CREW RATE less any savings effected by the
CONTRACTOR in reducing the numbers of CONTRACTOR'S PERSONNEL
to skeleton strength for caretaker purposes only. The OPERATOR
shall give the CONTRACTOR 30 (thirty) days prior written
notice of the application of this Rate, which shall be
applicable for a period of not less than 30 (thirty) days.
In addition, the OPERATOR shall reimburse the CONTRACTOR the
Standing Down/ Remobilisation Charge.
(j) The FORCE MAJEURE a) Rate and the FORCE MAJEURE b) Rate shall
be payable by the OPERATOR as provided in Section 2, Clause
10.
5.4 CHARGE FOR MEALS AND ACCOMMODATION PROVIDED BY CONTRACTOR
This charge shall be the amount per man-day applicable for meals and
accommodation provided by CONTRACTOR to OPERATOR'S and SERVICE
COMPANIES' Personnel eating and/or staying overnight on the DRILLING
UNIT in excess of 16 (sixteen) such Personnel per day.
Where Personnel stay overnight on the DRILLING UNIT, the said Charge
shall apply irrespective of whether the said Personnel are in fact each
provided with no meals per day or one or two or three meals per day,
and the substantiation for the application of this Charge shall be the
daily "people on board" telex. Where Personnel are not staying
4
SECTION 5
RATES AND CHARGES
PAGE 5 OF 7
================================================================================
overnight on the DRILLING UNIT, but have meals on board, the Casual
Meal Rate shall apply.
5.5 PERSONNEL
(a) Additional Personnel
The CONTRACTOR shall be paid at the rates set out in Schedule
2 hereto for personnel additional to those listed in Section 6
Schedule 6.1 requested by the OPERATOR. CONTRACTOR shall
provide additional supervisory personnel for familiarization
of the crew and safety and supervision on the DRILLING UNIT,
during the transition period through ninety (90) days after
the COMMENCEMENT DATE. OPERATOR shall pay CONTRACTOR fifty
percent (50%) of the rates, costs, and expenses for such
additional personnel during such transition period, up to a
maximum payment by OPERATOR of $150,000.
(b) Courses
The OPERATOR shall reimburse the CONTRACTOR for all costs and
expenses in respect of travel, accommodation and subsistence
reasonably and properly incurred by CONTRACTOR'S RIG STAFF who
attend the OPERATOR'S or OPERATOR'S approved in-house required
courses. Invoices for such reimbursement shall be supported by
the requisite bills, tickets and other such substantiation as
the OPERATOR may reasonably require.
(c) Replacement
Pending replacement of personnel the OPERATOR shall deduct
from any monies due to the CONTRACTOR at the appropriate rate
per day quoted in Schedule 5.2 for all days in excess of 7
(seven) days that such person shall not have been so replaced.
5.6 ADDITIONAL EQUIPMENT
The OPERATOR shall reimburse the CONTRACTOR as follows for additional
equipment provided after the COMMENCEMENT DATE:
(a) The capital costs of modifications to the DRILLING UNIT or
additional equipment purchased on the instructions of the
OPERATOR shall be reimbursed to the CONTRACTOR in accordance
with the provisions of sub-clause (b) hereunder.
(b) The agreed rental costs of listed equipment under the Schedule
5.3 hereto or if not listed the costs of materials or charges
for hire of additional equipment or services required by the
OPERATOR'S REPRESENTATIVE at net invoice cost, after deduction
of all discounts plus an addition of 10% for all items not
exceeding US$3,000 (three thousand dollars) and 6% on all
items exceeding US$3,000 (three thousand dollars) to cover the
CONTRACTOR'S additional costs, overhead charges and profit.
(c) The costs of transport and shipping the further equipment and
materials to the CONTRACT AREA.
5
SECTION 5
RATES AND CHARGES
PAGE 6 OF 7
================================================================================
(d) An agreed rental rate to be incorporated in the Schedule 5.3
hereto covering CONTRACTOR'S operating and maintenance costs
for each item on such additional equipment included in Section
7 hereof.
The OPERATOR shall not reimburse the CONTRACTOR for any further
equipment or materials supplied and delivered by it which the
OPERATOR'S REPRESENTATIVE has not first requested in writing as
aforesaid.
5.7 FIXED RATES
The rates and charges specified in Schedule 5.1, 5.2 and 5.3 shall be
fixed for the duration of the CONTRACT subject only to adjustments for
documented normal and customary changes in CONTRACTOR'S operating
costs, including but not limited to, all personnel related costs,
catering, insurance, repair and maintenance, travel expenses, and third
party towing charges in the fixed price demobilisation fees. CONTRACTOR
shall use reasonable efforts to keep the operating costs in line with
industry practice.
5.8 PAYMENT PROVISIONS
5.8.1 Monthly Account and Invoicing
(a) Within the first fifteen (15) days of each MONTH the
CONTRACTOR shall submit to the OPERATOR in triplicate
a monthly account in respect of DRILLING SERVICES
performed by it during the previous MONTH for which
payment is due, and also in respect of services given
and/or materials supplied (if any) for which payment
is due.
(b) Such account shall be accompanied by one copy of the
Time Breakdown Report and such other invoice support
documents or information as the OPERATOR may
reasonably require from time to time.
(c) Such account shall comprise one invoice for each WELL
on which the DRILLING UNIT has operated during the
previous MONTH.
(d) CONTRACTOR shall be responsible for ensuring timely
receipt of invoices by the OPERATOR. OPERATOR will
only pay CONTRACTOR's invoices submitted within two
(2) months of completion of the DRILLING SERVICES for
a particular well under this CONTRACT, except for
third party invoices which must be submitted within
four (4) months of completion of the DRILLING
SERVICES for a particular well. Invoices submitted
more than two (2) months or four (4) months as the
case may be, after completion of the DRILLING
SERVICES for a particular well under this CONTRACT
will be settled at the OPERATOR's discretion and may
result in non-payment.
(e) Invoices shall be numbered serially and submitted to
the OPERATOR at the following address, bearing the
CONTRACT reference number and well description:
BP TRINIDAD AND TOBAGO LLC
CONTRACT: C- 2600
6
SECTION 5
RATES AND CHARGES
PAGE 7 OF 7
================================================================================
WELL DESCRIPTION: (Well being drilled)
Marked for the attention of: THE INVOICE PROCESSING
SUPERVISOR (Well Operations)
or other address as may be advised to the CONTRACTOR
from time to time.
5.8.2 Payments by the OPERATOR
(a) To the extent it is not disputed by the OPERATOR, the
OPERATOR shall pay all invoices within 30 (thirty)
days after receipt thereof to bank accounts nominated
by the CONTRACTOR. In the event any undisputed
invoices are not so paid by the OPERATOR within the
said 30 (thirty) days, then the OPERATOR shall pay
interest on such unpaid amounts at the rate of 10%
per annum or pro rata thereof from the due date until
paid. The bank account to which OPERATOR shall make
payments under the CONTRACT shall be as follows:
BANK:
ACCOUNT:
Any change to the above details shall be the subject
of a formal amendment to CONTRACT.
(b) In the event that the OPERATOR disputes an invoice or
part thereof, the OPERATOR shall within 20 (twenty)
days of receipt thereof notify the CONTRACTOR in
writing of the invoice or part thereof so disputed
and specifying the reason therefor. Payment of such
disputed invoice or part thereof shall be withheld
until settlement of the said dispute. Such payments
so withheld shall not be subject to interest charges
unless the original invoices as submitted by the
CONTRACTOR are subsequently agreed by OPERATOR to be
correct based solely on the original support
documents or information provided.
(c) Payment by the OPERATOR of the CONTRACTOR'S invoices
shall be without prejudice to the OPERATOR's rights
subsequently to challenge the correctness thereof.
(d) Any expenditure of whatsoever nature incurred by the
CONTRACTOR in connection with the CONTRACT for which
responsibility has not been assumed in the CONTRACT
by the OPERATOR shall be a cost to be borne by the
CONTRACTOR.
(e) Payment by the OPERATOR of any account submitted by
the CONTRACTOR shall not discharge or release the
CONTRACTOR from any of its obligations under the
CONTRACT or be deemed approval or acceptance of work
covered by such account.
(f) All invoices shall be submitted in and payment made
in US Dollars.
7
SCHEDULE 5.1
RATES AND CHARGES
NAME OF DRILLING UNIT:...............................▇▇▇▇▇▇ CORONADO
Ref. No. DESCRIPTION OF RATE OR CHARGE Amount US$
MOBILISATION - DEMOBILISATION
OFFSHORE EAST COST OF TRINIDAD
1. MOBILISATION - direct to LOCATION $3,600,000 Lump Sum
- Via the Republic of Trinidad and Tobago $3,600,000 Lump Sum
2. DEMOBILISATION - from the REPUBLIC of Trinidad and Tobago $2,800,000 Lump Sum
3. STANDING DOWN/ REMOBILISATION CHARGE NA
DAILY RATES
4. OPERATING $73,000 per day
5. PROVISIONING/ DEPROVISIONING $68,000 per day
6. STANDBY $71,000 per day
7. MOVING $71,000 per day
8. REPAIR 85% of OPERATING RATE
9. REDRILLING 75% of OPERATING RATE
10. FISHING 75% of OPERATING RATE
11. SHUTDOWN WITH CREW $71,000 per day
12. SHUTDOWN WITHOUT CREW $71,000 per day
13. FORCE MAJEURE a) $71,000 per day
b) $60,000 per day
14 REPAIR RATE INCENTIVE $1000 per hour
(Payable for each hour of repair time less
than 10 hours per month)
SCHEDULE 5.1 TO SECTION 5
RATES AND CHARGES
PAGE 2 OF 2
================================================================================
MISCELLANEOUS SERVICES FOR OPERATOR'S PERSONNEL
15. Meals and accommodation provided by
CONTRACTOR (in excess of 16 (sixteen) $60.00 per man per day per day
OPERATOR'S personnel)
Casual Meal Rate $15.00 per meal
16. The Rate per day for CONTRACTOR'S PERSONNEL who have been
removed and who have not been replaced by the CONTRACTOR
shall be a deduction of the amount of the rate in schedule
5.2 hereto for the person so removed for all days in excess
of seven (7) days that such person shall not have been so
replaced until such time as the said person so removed has
been replaced.
2
SCHEDULE 5.2
RATES FOR
CONTRACTOR'S PERSONNEL
(SEE NEXT PAGE)
Trinidadian Operations 25% 37.2%
====================== === =====
Title Total Number * On Board Expatriate or Work Schedule Annual Base Foreign Overhead &
===== ============== ======== ============== ============= ============ ======== ===========
National Salary Service Premium Insurance
======== ====== =============== ==========
Burden
Expatriate
----------
Rig Manager 2 1 Expatriate 28 On/28 Off $81,600 $20,400 $30,355
Assistant Rig Manager 2 1 Expatriate 28 On/28 Off 72,000 18,000 26,784
Rig Engineer (Barge Engineer) 2 1 Expatriate 28 On/28 Off 66,326 16,582 24,673
Safety & Training Coordinator 2 1 Expatriate 28 On/28 Off 46,290 11,573 17,220
Mechanic 2 1 Expatriate 28 On/28 Off 58,035 14,509 21,589
Electrician 2 1 Expatriate 28 On/28 Off 58,035 14,509 21,589
Crane Operator 4 2 Expatriate 28 On/28 Off 48,363 12,091 17,991
Driller 4 2 Expatriate 28 On/28 Off 59,417 14,854 22,103
Sub-Total 20 10
========= == ==
National
========
Assistant Driller 4 2 National 14 On/14 Off $ 35,000 - 13,020
Derrickman 4 2 National 14 On/14 Off 28,000 - 10,416
Shaker Hand 4 2 National 14 On/14 Off 26,500 - 9,858
Floorman 12 6 National 14 On/14 Off 26,000 - 9,672
Assistant Electrician 2 1 National 14 On/14 Off 28,000 - 10,416
Motorman 4 2 National 14 On/14 Off 28,000 - 10,416
Clerk/Radio Operator 2 1 National 14 On/14 Off 28,000 - 10,416
Storeman 2 1 National 14 On/14 Off 25,000 - 9,300
Welder 2 1 National 14 On/14 Off 30,000 - 11,160
Lead Roustabout 4 2 National 14 On/14 Off 28,000 - 10,416
Roustabout 12 6 National 14 On/14 Off 26,000 - 9,672
▇▇▇▇▇▇▇ 2 1 National 14 On/14 Off 28,000 - 10,416
Night ▇▇▇▇ 4 2 National 14 On/14 Off 26,000 - 9,672
Utility Hand 8 4 National 14 On/14 Off 24,000 - 8,928
Sub-Total 66 33
========= == ==
Total Personnel 86 43
=============== == ==
Table continued...
Trinidadian Operations
======================
Title Total Day Rate with Crew
===== ====== ============== ====
Annual Cost Burden per Additions/Day/Position**
============ =========== ========================
Per Person Person
Expatriate
----------
Rig Manager $ 132,355 $ 362.62 $ 725.23
Assistant Rig Manager 116,784 319.96 639.91
Rig Engineer (Barge Engineer) 107,581 294.74 589.48
Safety & Training Coordinator 75,082 205.71 411.41
Mechanic 94,133 257.90 515.80
Electrician 94,133 257.90 515.80
Crane Operator 78,445 214.92 429.83
Driller 96,374 264.04 528.08
Sub-Total
=========
National
========
Assistant Driller
48,020 131.56 263.12
Derrickman
38,416 105.25 210.50
Shaker Hand
36,358 99.61 199.22
Floorman
35,672 97.73 195.46
Assistant Electrician
38,416 105.25 210.50
Motorman
38,416 105.25 210.50
Clerk/Radio Operator
38,416 105.25 210.50
Storeman
34,300 93.97 187.95
Welder
41,160 112.77 225.53
Lead Roustabout
38,416 105.25 210.50
Roustabout
35,672 97.73 195.46
▇▇▇▇▇▇▇
38,416 105.25 210.50
Night ▇▇▇▇
35,672 97.73 195.46
Utility Hand
32,928 90.21 180.43
Sub-Total
=========
Total Personnel
===============
** Rates are per position. This rate includes two persons, one for crew A, one
================================================================================
for crew B. Does not include additional travel cost, if any and /or additional
================================================================================
catering costs
==============
SECTION 6
CONTRACTOR'S PERSONNEL
6.1 PROVISION OF CONTRACTOR'S PERSONNEL
The CONTRACTOR shall provide all CONTRACTOR'S PERSONNEL listed in
Schedule 6.1 hereof in the numbers and categories referred to therein.
Such numbers and categories shall not be exceeded or reduced without
prior written approval of the OPERATOR and any change in the numbers
and/or categories so approved shall be recorded by amendment to
Schedule 6.1. Should the OPERATOR require the CONTRACTOR to provide
additional PERSONNEL in excess of the full complement of CONTRACTOR'S
PERSONNEL or SUB-CONTRACTOR'S personnel listed in Schedules 6.1 and 6.2
then the CONTRACTOR shall be reimbursed at the day rates included under
SECTION 5. The CONTRACTOR shall give the OPERATOR'S REPRESENTATIVE the
name and work history, education and training history including courses
attended of such CONTRACTORS PERSONNEL including any person proposed as
a replacement therefor. The OPERATOR may at its discretion approve or
veto the provision of any such CONTRACTOR'S PERSONNEL by stating the
reason therefor and may within fourteen (14) days of receipt of such
histories notify the CONTRACTOR in writing of its approval or veto.
Absence of such notification by the OPERATOR within fourteen (14) days
shall constitute approval.
The selection, replacement, hours of labour and remuneration of
CONTRACTOR's PERSONNEL shall be determined by CONTRACTOR.
6.2 CONTRACTORS REPRESENTATIVE
The CONTRACTOR shall provide a competent and authorised Representative
who shall be nominated in writing and be acceptable to the OPERATOR.
The CONTRACTOR'S REPRESENTATIVE shall be available at all times and
shall be authorised to receive on behalf of the CONTRACTOR all
directions and instructions in connection with the SERVICES from the
OPERATOR'S REPRESENTATIVE.
CONTRACTOR's REPRESENTATIVE shall be in charge of all CONTRACTOR's
personnel and shall have authority to resolve all day to day matters
which arise between OPERATOR and CONTRACTOR.
6.3 GENERAL
The CONTRACTOR shall adhere to all labour standards and practices
applicable to the CONTRACT AREA.
All personnel provided by the CONTRACTOR in accordance with sub-clause
6.1 above, shall be deemed to be the employees of the CONTRACTOR and
the CONTRACTOR shall be solely responsible for payment of salaries to
such personnel.
The CONTRACTOR shall meet all costs for its PERSONNEL, including but
without limitation those associated with travel, accommodation, holiday
and sickness throughout the duration of the SERVICES.
The CONTRACTOR'S PERSONNEL shall be sufficiently conversant with the
English language to enable the OPERATOR'S REPRESENTATIVE to issue
instructions and to receive written and verbal reports in the English
language and so that operations hereunder are not hampered or
SECTION 6
CONTRACTOR'S PERSONNEL
PAGE 2 OF 4
================================================================================
endangered on account of language barriers. The radio and computer
operator must be English speaking.
The CONTRACTOR shall be responsible for all matters relating to rest
periods for its personnel including inter alia the provision of a
relief operating crew where the performance of the SERVICES as required
by the OPERATOR so dictates.
6.4 TRAINING
The CONTRACTOR shall ensure that all personnel proposed in compliance
with the foregoing shall have undertaken courses in accordance with the
CONTRACTOR'S operations manual and good oilfield practice and all
OPERATOR required HSE training requirements.
6.5 MEDICAL CERTIFICATES
The CONTRACTOR shall make available to the OPERATOR'S REPRESENTATIVE
valid medical certificates stating that each person travelling to the
DRILLING UNIT on behalf of the CONTRACTOR is fit to do so.
6.6 PERSONNEL RECORDS
The CONTRACTOR shall keep medical records, wages books and time sheets
and full records of the CONTRACTOR'S PERSONNEL. The CONTRACTOR shall
keep details of its PERSONNEL'S next of kin on the DRILLING UNIT and at
its shore base.
6.7 QUALIFICATIONS AND TRAINING OF CONTRACTOR'S PERSONNEL
(a) General
All CONTRACTOR'S PERSONNEL and SUB-CONTRACTOR'S personnel on
board the DRILLING UNIT shall be required to have attended an
Offshore Basic Fire Course and an Offshore Survival Course
held at an OPERATOR approved training centre prior to working
on board the DRILLING UNIT with refresher training every three
years. Specialist training for helicopter refuelling crews and
fire teams is also required. All costs incurred shall be to
the account of the CONTRACTOR.
(b) Drilling Personnel
The CONTRACTOR shall prior to the COMMENCEMENT DATE ensure
that the RIG STAFF shall have satisfactorily completed a well
control procedure training course and have obtained a Well
Pressure Control Certificate from a training establishment
approved by IWCF or the relevant authorities in the CONTRACT
AREA. The CONTRACTOR shall at its cost further ensure that the
RIG STAFF shall attend refresher courses at such approved
training establishments at intervals of not more than twelve
months and maintain validity of certification for all RIG
STAFF throughout the term of the CONTRACT and any extension
thereto.
Whenever so requested by the OPERATOR the CONTRACTOR shall
make available to the OPERATOR certificates evidencing such
validity. The CONTRACTOR shall arrange, at regular weekly
intervals, for on site training of its PERSONNEL engaged in
drilling operations on the DRILLING UNIT in matters relating
to health, safety, accident prevention and environmental
2
SECTION 6
CONTRACTOR'S PERSONNEL
PAGE 3 OF 4
================================================================================
protection and, in addition, prior to the commencement of
specialised operations such as drill stem and production
testing and radioactive logging. Minutes of meetings held to
fulfil such training requirements shall be made available to
the OPERATOR and shall be posted on notice boards on the
DRILLING UNIT.
Notwithstanding the foregoing provisions, the CONTRACTOR'S RIG
STAFF shall if required by OPERATOR attend the OPERATOR'S
Pressure Control and HP and HT course. Such attendance if
required shall take place at times and dates to be arranged
between the CONTRACTOR and OPERATOR but in any case prior to
the COMMENCEMENT DATE.
(c) Marine and Installation Personnel
The CONTRACTOR shall ensure that prior to the COMMENCEMENT
DATE and throughout the continuance of the CONTRACT the
Captain or the equivalent person but under a different title
are properly qualified for their respective positions and
experienced in carrying out their duties on the DRILLING UNIT.
The CONTRACTOR shall ensure that, (otherwise than in the event
of total DRILLING UNIT evacuation on the instructions of the
OPERATOR) there is always one person on board who is fully
competent in respect of, and is designated responsible for,
marine operations and calculation of deck loadings.
6.8 EMPLOYMENT OF LOCAL PERSONNEL AND RATES OF PAY
The CONTRACTOR shall, if applicable to this CONTRACT, employ local
labour subject to availability and suitability of qualifications and
experience. The CONTRACTOR shall ensure early contact is made with the
Trinidad authorities to ascertain its requirements in this regard.
The CONTRACTOR shall comply with all relevant governmental rules,
regulations and instructions with respect to the employment of local
labour.
6.9 PASSPORTS AND VISAS
The CONTRACTOR shall ensure that when appropriate all CONTRACTOR'S
PERSONNEL are in possession of valid passports and shall obtain all
visas and entry or other permits required to enable such CONTRACTOR'S
PERSONNEL to proceed to and work in the CONTRACT AREA and shall assist
such PERSONNEL in clearing immigration in Trinidad.
6.10 TRANSPORTATION
The CONTRACTOR shall make its own arrangements and meet all expenses
for the transport of all the CONTRACTOR'S PERSONNEL to and from and
within the CONTRACT AREA other than between the DRILLING UNIT and the
OPERATOR'S designated crew change location in the CONTRACT AREA.
6.11 REMOVAL OF PERSONS PROVIDED BY THE CONTRACTOR AND THE SUB-CONTRACTORS
At the instruction of the OPERATOR in writing the CONTRACTOR shall
remove from duties hereunder or lawfully secure such removal of any of
the CONTRACTOR'S PERSONNEL who is unacceptable to the OPERATOR.
3
SECTION 6
CONTRACTOR'S PERSONNEL
PAGE 4 OF 4
================================================================================
OPERATOR shall state the reason for such removal in the written
instruction.
6.12 REPLACEMENT OF PERSONS REMOVED BY THE CONTRACTOR
The CONTRACTOR shall forthwith at its cost and expense replace any such
person removed under the provisions of sub clause 6.11 hereof such
replacement being a person qualified and capable of performing in an
efficient manner the duties of any such person being replaced. This
sub-clause shall also apply to CONTRACTOR'S PERSONNEL leaving of their
own volition.
6.13 RESTRICTION AS TO DRUGS AND ALCOHOLIC LIQUORS
The CONTRACTOR shall not except for bona fide medical purposes, sell,
barter, give, dispense or otherwise dispose of any drugs or alcoholic
liquors to any person at the LOCATION, shall prohibit any such sale,
barter, gift, dispensation or other disposal to be made by any of the
CONTRACTOR'S PERSONNEL.
6.14 RECOGNISED FESTIVALS AND RELIGIOUS AND OTHER CUSTOMS
The CONTRACTOR shall at all times and in all respects in all dealings
with the CONTRACTOR'S PERSONNEL observe and pay full deference to all
recognised festivals and religious or other customs.
6.15 DISORDERLY CONDUCT
The CONTRACTOR shall take all requisite precautions and use his best
endeavours to prevent any riotous or unlawful behaviour by or amongst
any of the CONTRACTOR'S PERSONNEL.
6.16 BRIBERY
The CONTRACTOR shall not make or offer any bribe or any gift, gratuity,
reward, commission or other inducement in money or of any description
whatsoever to any person in the employment of the OPERATOR or SERVICE
COMPANIES.
6.17 REPATRIATION OF CONTRACTOR'S PERSONNEL
The CONTRACTOR shall, pending the repatriation of any of the
CONTRACTOR'S PERSONNEL maintain such CONTRACTOR'S PERSONNEL in a proper
manner until such time as they shall have left the CONTRACT AREA and in
default thereof the OPERATOR may maintain and repatriate such
CONTRACTOR'S PERSONNEL and recover the cost thereof from the
CONTRACTOR.
6.18 SAFETY
The CONTRACTOR shall provide its personnel with protective clothing and
safety equipment identifying them as the CONTRACTOR'S PERSONNEL to
designs approved by the OPERATOR for offshore working conditions in the
CONTRACT AREA.
4
SCHEDULE 6.1 AND 6.2
INITIAL STAFFING OF CONTRACTOR'S AND SUB-CONTRACTOR'S PERSONNEL
Trinidadian Operations
----------------------
Title Total On Expatriate or Work Schedule
----- ----- -- ------------- -------------
Number * Board National
-------- ----- --------
Expatriate
Rig Manager 2 1 Expatriate 28 On/28 Off
Assistant Rig Manager 2 1 Expatriate 28 On/28 Off
Rig Engineer (Barge 2 1 Expatriate 28 On/28 Off
Engineer)
Safety & Training 2 1 Expatriate 28 On/28 Off
Coordinator
Mechanic 2 1 Expatriate 28 On/28 Off
Electrician 2 1 Expatriate 28 On/28 Off
Crane Operator 4 2 Expatriate 28 On/28 Off
Driller 4 2 Expatriate 28 On/28 Off
Paramedic 2 1 Expatriate 28 On/28 Off
========= = =
Sub-Total 22 11
========= == ==
National
Assistant Driller 4 2 National 14 On/14 Off
Derrickman 4 2 National 14 On/14 Off
Shaker Hand 4 2 National 14 On/14 Off
Floorman 12 6 National 14 On/14 Off
Assistant Electrician 2 1 National 14 On/14 Off
Motorman 4 2 National 14 On/14 Off
Clerk/Radio Operator 2 1 National 14 On/14 Off
Storeman 2 1 National 14 On/14 Off
Welder 2 1 National 14 On/14 Off
Lead Roustabout 4 2 National 14 On/14 Off
Roustabout 12 6 National 14 On/14 Off
▇▇▇▇▇▇▇ 2 1 National 14 On/14 Off
Night ▇▇▇▇ 4 2 National 14 On/14 Off
Utility Hand 8 4 National 14 On/14 Off
Sub-Total 66 33
========= == ==
Total Personnel 88 44
=============== == ==
SCHEDULE 6.3
LIST OF MODIFICATION TO BE PROVIDED BY CONTRACTOR
Amortization Period: 3 years
--------------------
Amortization Rate: 15%
------------------
Residual BP BP
Value Residual Amortized Daily
No. Item Cost Rate Value Amount Rate
-----------------------------------------------------------------------------------------------------------------------------------
A. Exploratory ▇▇▇▇▇
-----------------
1 25,000' 5-1/2" S-135 drill pipe with HT 55 connections, 7"
OD x 3-3/4" ID $1,447,635 50% 723,818 $ 723,818 ($821)
1A Credit for 5" DP on Rig Now (18,000' X $20/ft.) (360,000) 0% - $(360,000) 408
2 30 joints of 5-1/2" Spiral-wate drill pipe with HT 55 conn. $ 128,220 50% 64,110 $ 64,110 (73)
2A Credit for 5" HW on Rig Now (30 jts. X $1,500 each) (45,000) 0% - $ (45,000) 51
3 All subs and accessories for above, including inspections 91,100 50% 45,550 45,550 (52)
4 Miscellaneous handling tools, rams, etc. for above 167,650 50% 83,825 83,825 (95)
5 Freight, 18 loads tubulars @ 1,800. 32,400 50% 16,200 16,200 (18)
6 Relocate Schlumberger logging unit to port leg 200,000 100% 200,000 - -
7 Relocate cement unit to centerline under elevated piperack 100,000 100% 100,000 - -
8 Reroute exhausts to aft of port leg 150,000 100% 150,000 - -
9 Extra high pressure washdown equipment 10,000 100% 10,000 - -
10 Trash Compactor 18,000 100% 18,000 - -
11 Additional man rider air hoist under floor 25,000 100% 25,000 - -
12 International spare parts inventory 500,000 100% 500,000 - -
13 21-1/4" 5M double ram with 21-1/4" 5M Bag (option rental) 850,000 50% 425,000 425,000 (482)
14 Maximum quarters capacity (100 preferred) 200,000 50% 100,000 100,000 (113)
15 UV Purifier 15,000 100% 15,000 - -
16 Crane Rests (Reinstall) 5,000 100% 5,000 - -
17 Rig LAN and CORIS and Satellite 125,000 50% 62,500 62,500 (71)
18 Flare Boom Stanchions 25,000 100% 25,000 - -
19 Thru hull dump 10,000 100% 10,000 - -
20 Change Name of rig to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ 20,000 100% 20,000 - -
21 Site specific survey and analysis 25,000 100% 25,000 - -
----------------------------------------------------------------
Sub-Total $3,740,005 NA $2,579,003 $1,116,003 $(1,266)
----------------------------------------------------------------
B. KAPOK Development Program
-------------------------
22 Increase base oil storage to 1,000 bbls. 100,000 75% 75,000 25,000 (28)
23 Increase mud capacity by 800 bbls. 175,000 75% 131,250 43,750 (50)
24 Add 2 each 700 bbl. Brine storage tanks - 1,400 bbls. Total 150,000 75% 112,500 37,500 (43)
25 P-Quip Super Mud Bucket 45,000 75% 33,750 11,250 (13)
26 2 anchor winches, fairleads, buoys, anchors, racks, etc. 400,000 50% 200,000 200,000 (227)
27 Relocate welding shop 20,000 100% 20,000 - -
----------------------------------------------------------------
Sub-Total $ 890,000 NA $ 572,500 $ 317,500 $ (360)
----------------------------------------------------------------
Total $4,630,005 NA $3,151,503 $1,433,503 $(1,626)
================================================================
Notes:
------
1. If contract terminates earlier than three (3) years for any reason, BP will
owe the Unamortized principal 1 balance
2 Above included in contract rates
SECTION 7
PART I
DRILLING UNIT, EQUIPMENT, SUPPLIES AND
SERVICES TO BE PROVIDED BY THE CONTRACTOR
(See Next Page)
▇▇▇▇▇▇ Coronado Jackup Drilling Unit
--------------------------------------------------------------------------------
The ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ is a ▇▇▇▇▇▇▇▇▇▇ Super 116 jackup mobile offshore
drilling unit, designed by ▇▇▇▇▇▇▇▇▇▇, Inc., Longview, Texas. The unit is
classed by the American Bureau of Shipping (ABS) and complies with the IMO
MODU Code. A cantilevered drilling structure and substructure allows the
unit to drill or workover ▇▇▇▇▇ on existing fixed production platforms. The
▇▇▇▇▇▇ Coronado is designed to work in water depths as shallow as 16 feet
and up to 360 feet. Fully air-conditioned quarters can accommodate a crew
of 94.
A. GENERAL DESCRIPTION
--------------------------------------------------------------------------------
Type: ▇▇▇▇▇▇▇▇▇▇ Super 116 Class Independent Leg Cantilever Jackup
Builder: TDI Halter Marine- Pascagoula, MS
Year Built: 1999
Class: ABS Maltese Cross A1 Self-Elevating Mobile Drilling Unit, 1996 Rules. IMO MODU Code for the Construction
& Equipping of Mobile Offshore Drilling Units, 1989
Flag: Panama
Elevating System: ▇▇▇▇▇▇▇▇▇▇ Electric Rack and Pinion Jacking System
1. Principal Dimensions
--------------------
Length Overall 243'-0"
Breadth 206-'0"
Depth of Hull 26'-0"
Length of Legs 477'-0"
Spud Tank Diameter 46 "-0"
2. Hull Draft and Displacement
---------------------------
Lightship Draft - Minimum 14'-0"
Loadline Draft - Maximum 16'-0"
Lightship Displacement (Kips) 22933
Loadline Displacement (Kips) 25935
3. Quarters
--------
Complete air-conditioned accommodations for a ninety-four (94)
person crew. In addition to accommodations, the four-story
quarter's structure contains a galley/mess room, six (6) man
treatment room, fitness room, crew change room, offices,
recreation rooms, control room, and radio room.
4. Heliport
--------
73' octagonal steel cantilevered heliport designed to
withstand loads imposed by a Sikorsky S-61N helicopter or
equal. Heliport is lighted and equipped with tie downs,
perimeter safety nets, and access stairs.
5. Storage Capacities
------------------
Diesel fuel 4,611 bbls.
SECTION 7
DRILLING UNIT, EQUIPMENT, SUPPLIES
PAGE 2 OF 9
================================================================================
Drill water 14,592 bbls.
Potable water 1,220 bbls.
Liquid mud (in main mud pits) 3,300 bbls.
Base oil 1,000 bbls.
Brine (Completion Fluid) 1,400 bbls.
Bulk Mud 5,440 cu. ft.
Bulk Cement 5,440 cu. ft.
Sack Storage 5,000 sacks
Hook Load 1500 kips
Rotary Load 1500 kips
Setback Load 600 kips
B. LOADING AND ENVIRONMENTAL CONDITIONS
--------------------------------------------------------------------------------
1. On Bottom Conditions
--------------------
Severe Storm Operating
------------ ---------
Water Depth (feet)(1) 328 350
Wind Velocity (knots) 100 70
Current (knots) 1.0 1.0
Wave Height (feet) 47 35
Wave Period (sec) 15 15
Min. Air Gap (feet) 50 35
Max. Leg Can Penetration (feet) 25 25
Maximum Variable Load (kips)
in above conditions (2) 3,300 4,800
Comb.Rig.Flr.Loads (kips)(3) 750 1,500
Well Position (feet)
Aft of Hull Transom (feet) 00.0 65.0
P/S off CL Vessel (feet) 00.0 15.0
2. Transit Condition:
-----------------
Minimum Draft (Lightship) 14'-0"
ABS Load Line (Hull Draft) 16'-0"
Total Variable Load (Kips) (4) 3,300
Total Variable Load While Jacking (Kips) 3,300
Notes:
-----
(1) Maximum water depth must include consideration for
high tides and storm surge.
(2) Does not include combined rig floor loads listed
below.
(3) Maximum individual rig floor loads are:
Hook Load.......................1,500 kips
Rotary Load.....................1,500 kips
Setback Load......................600 kips
Above loads valid up to 70 knot wind speed, however
no setback load allowed above 50 knots. Hook load
varies according to well center location. Max.
combined drill floor load is 1,500 kips. Pipe rack
load during skidding is 1,000 kips.
2
SECTION 7
DRILLING UNIT, EQUIPMENT, SUPPLIES
PAGE 3 OF 9
================================================================================
(4) Displacement of vessel at the load line minus
displacement of vessel at lightship.
C. PLATFORM EQUIPMENT
--------------------------------------------------------------------------------
1. Primary Generators
------------------
Four (4) Caterpillar Model 3606 diesel engines rated at 2,514
HP each driving 3000 KVA continuous, 60 Hz, 600 volt ▇▇ ▇▇▇▇
generators.
2. Standby/Emergency Generator
---------------------------
One (1) Caterpillar Model 3508 diesel engine driving a 893 KVA
continuous, 60 Hz, 480 volt generator complete with switch
gear, automatic start, breakers and DC battery bank.
3. SCR System
----------
Five (5) ▇▇▇▇ ▇▇▇▇ Controls 600V, 2200 amps each. Universal
Switch Gear Inc. leg elevator contactors, AC breaker panels
and two (2) ground detector panels: SCR room cooled by two (2)
15 Ton Carrier central air conditioner units.
4. Watermaker
----------
One (1) Specific Equipment - Model SE 132 ROM-1, reverse
osmosis watermaker, rated at 13,200 gallons per day.
5. Water Purifier
--------------
One (1) Specific Equipment Ultra Violet Purifier for
Purification of rig potable water - Model I-H-16-L, capacity
330 GPM.
6. Pressure Washer
---------------
One (1) Sioux - Model EN270-H4-300, steam/pressure washer,
rated at 4.5 GPM at 3,000 psi.
7. Waste Treatment Unit
--------------------
One (1) Exceltec 12MX, 120 Person Marine Sanitation Device.
8. Trash Compactor
---------------
One (1) Dolphin - Model 4000, 40 cu./ft. capacity
9. Air Compressors
---------------
a. One (1) Airdyne cold start air compressor rated at 46
CFM powered by 2-cylinder Lister Diesel engine with
electric start.
b. Two (2) Airdyne 500 HOSS-JS rotary air compressors,
each rated at 500 CFM at 125 psi powered by 125 HP AC
electric motors.
c. One (1) Airdyne 500 HOSS-JS bulk dual air compressor,
rated at 500 cfm, 40 psi.
3
SECTION 7
DRILLING UNIT, EQUIPMENT, SUPPLIES
PAGE 4 OF 9
================================================================================
d. One (1) Refrigerated Air Dryer - ▇▇▇▇▇▇▇▇▇ Model
80600, 750 cfm @ 38 degrees F.
10. Welding Equipment
-----------------
Two (2) ▇▇▇▇▇▇ SRH-444, 400 amp welding machines.
11. System Pumps
------------
a. Two (2) Bilge Pumps, ▇▇▇▇▇▇ ▇▇▇▇ 25 HP self-priming
pumps.
b. Two (2) Salt Water/Fire Pumps, 75 HP, Mission 4 x 3 x
13 centrifugal pumps.
c. Two (2) Drill Water Pumps, 30 HP, Mission 4 x 3 x 13
centrifugal pumps.
d. One (1) Waste Oil Pump, gear type.
e. Two (2) Fuel Oil Transfer Pumps, 5 HP, gear type.
f. Three (3) Peerless Model 14-MB/4 stage, submersible
salt-water service pumps. 75 HP rated @ 1,000 gpm @
65 psi.
g. Two (2) Each Potable and Salt Water Pressure Sets
with Specific Brand 150 2" centrifugal vertical type
pumps powered by AC electric motors with
approximately 200-gallon pressure tanks.
h. Two (2) Brake Cooling Water Pumps, 20 HP, 3 x 2 x 13
Mission centrifugal pumps.
12. Cranes
------
Three (3) ▇▇▇▇▇▇▇▇▇▇ pedestal cranes, two (2) with 100' booms,
port midship crane with 120' boom, 50 ton capacity at 20'
radius with 4-part line. Complete with operator cabs.
13. Mooring System
--------------
Two (2) each ▇▇▇▇▇▇▇▇▇▇ W-1500 anchor winches, 800 feet of
1-5/8" wire rope, fairleads, two (2) 10,000 lb. stockless
anchors, buoys, and pendant wire.
14. Flare Boom Base
---------------
Basic flare boom bases with stanchions
D. SAFETY AND LIFESAVING EQUIPMENT
--------------------------------------------------------------------------------
1. Lifeboats/Liferafts
-------------------
Three (3) Survival Systems International, self-propelled,
enclosed lifeboats with launch davits approved for 50-person
capacity each. Four (4) 25-man inflatable life rafts with
hydrostatic release.
2. Miscellaneous
-------------
Life preservers, life rings, litters and first aid equipment
in compliance with U.S. Coast Guard and IMO regulations.
3. Fire Stations
-------------
Approximately twenty-five (25) salt-water fire stations with
50' hose each. Fixed CO2 fire extinguishing systems complete
with cylinders, piping, nozzles, sensors and controls for
engine room, paint locker, and galley. Complete fire and gas
detection system.
4. Treatment Room
--------------
Fully equipped with Paramedic capability
4
SECTION 7
DRILLING UNIT, EQUIPMENT, SUPPLIES
PAGE 5 OF 9
================================================================================
5. Fog Horn
--------
One (1) AB-560 Audiobeam 2-mile Fog Signal with automatic
signal device.
E. DRILLING EQUIPMENT
--------------------------------------------------------------------------------
1. ▇▇▇▇▇▇▇
-------
Dreco 170' clear height x 40' x 32' base, with a 1,500,000 lb.
hook load capacity.
2. Crown Block
-----------
Dreco crown block, 680 ton rated with six (6) 60" diameter
forged steel sheaves grooved for 1-5/8" drill line with dual
fast line sheaves and dual dead line sheaves.
3. Drawworks
---------
National 1625-UDBE with disc brakes, nominal depth rating
30,000 feet
a. Three (3) each GE-752 DC electric motors rated 1085
HP each
b. Elmagco Model 7838 Eddy Current Auxiliary Brake
▇. ▇▇▇▇▇ grooved drum for 1-5/8" drilling line
d. Two (2) breakout and makeup spinning catheads
4. Travelling Block
----------------
National, 650 ton, Hook/Block Combination with seven (7) 60"
diameter sheaves grooved for 1-5/8" drill line.
5. Power Swivel (Top Drive)
------------------------
National-Oilwell PS2 650/650 Power Swivel rated at 650 tons.
Two speed with maximum continuous torque rating of 47,859 foot
pounds @ 109 RPM. Driven by one (1) GE 752 DC Hi-Torque
electric motor. 4" bore, 7,500 psi WP. Maximum RPM in low gear
- 113, in high gear - 231.
6. Rotary Table
------------
National Model D-495, 49 1/2" rotary independently driven by a
GE 752 DC Hi-Torque electric motor, 1130 HP, with standard two
speed transmission. Varco MPCH hinged master bushing, with
insert bowls for 2 3/8" - 8 5/8" tubulars.
7. Rotating Mouse Hole Assembly for Stand Building
-----------------------------------------------
a. International Model 1994 rotating mouse hole for
right or left hand rotation.
b. International Model TT-1998 torque tool assembly.
Operating range 3-1/2" drill pipe to 8-1/2" drill
collars. Torque range 0 to 108,000 ft. Lbs.
8. Mud Pumps
---------
Three (3) National 14-P-220 triplex pumps, rated at 2,200 HP
each, with 7,500 psi fluid ends, each driven by two (2) GE 752
DC Hi-Torque electric motors. Each mud pump is equipped with a
PPDR-130-7500C5 discharge dampener and PPSC-80-025C5 flow
through cellular suction stabilizer, and a reset type relief
valve. Maximum speed - 95 spm. Maximum discharge pressure -
90% of liner rating.
5
SECTION 7
DRILLING UNIT, EQUIPMENT, SUPPLIES
PAGE 6 OF 9
================================================================================
9. Iron Roughneck
--------------
National "Iron Roughneck" Model IR-170.
10. Mud System
----------
a. Mixing Pumps: Two (2) Mission Magnum 6 x 8 centrifugal pumps powered by
100 HP AC electric motors.
b. Charging Pumps: Three (3) Mission Magnum 6 x 8 centrifugal pump powered
by 100 HP AC electric motor.
c. Agitators: Ten (10) each 25 HP, 1,200 rpm for main & brine pits.
Four (4) each 10 HP, 1,200 rpm for auxiliary pits.
Four (4) each 5 HP, 1,200 rpm for solids control pits.
d. Mud Cleaner/Desilter: One (1) ▇▇▇▇▇▇ LCM-2D-CMC Linear Motion Mud
Conditioner with thirty-two (32) 4" cones, 1,920 gpm,
discharging over a LCM-2D linear motion shaker deck.
Supplied by two (2) Mission Magnum 6 x 8 pumps with
100 HP AC motors.
▇. ▇▇▇▇▇▇▇▇: ▇▇▇▇▇▇ LCM-2D-CMC Linear Motion Mud Conditioner with
four (4) 12" cones, 2,000 gpm, discharging over a
LCM-2D linear motion shaker deck. Supplied by (1) 6 x 8
pump with 100 HP AC motor.
f. Shale Shakers: Five (5) ▇▇▇▇▇▇ LCM-2D Linear Motion Cascade Screen
Separators, each rated at 400-600 gpm. One (1) ▇▇▇▇▇▇
Nutec Gumbo Chain System.
g. Degasser: Two (2) ▇▇▇▇▇▇ ▇▇-10 Degassers, supplied by (2) Mission
Magnum 6 x 8 pumps with 100 HP AC motors.
h. Trip Tank: Two (2) x 34-barrel capacity with two (2) Halco 3 x 4 x
10 pumps with 40 HP AC electric motors.
11. Stand Pipe and Manifold
-----------------------
Dual standpipes rated at 7,500 psi W.P.
Demco standpipe manifold rated at 11,250-psi test pressure and
7,500 psi W.P. Dual cement manifold with stand pipes rated at
15,000 psi.
12. Rotary Hose Two (2) -4" ID Copperstate rotary hoses rated at 7,500
----------- psi W.P.
13. Bulk Storage Tanks
------------------
a. Bulk Mud: Four (4) each, 1,360 cu. ft.
b. Bulk Cement: Three (3) each, 1,360 cu. ft.
c. Bulk Gel: One (1) each, 1,360 cu. Ft.
c. Bulk Mud Surge Tank: One (1) each, 45 cu. ft.
14. Cementing Unit
--------------
Halliburton (On Main Deck)
6
SECTION 7
DRILLING UNIT, EQUIPMENT, SUPPLIES
PAGE 7 OF 9
================================================================================
15. Blow-Out Preventers
-------------------
a. 13-5/8" X 10,000 Blow-Out Preventers
---------------------------------------------
(1) Annular: One (1) Cameron type DL spherical preventer, 10,000 WP
------- with 10,000# WP studded top and 15,000# WP flanged
bottom connection, H2S trim.
(2) Rams: One (1) Cameron Type U 15,000-psi W.P. double ram
---- preventer and One (1) Cameron Type U 15,000-psi W.P.
single ram preventer with three (2) sets of 5" pipe rams
and one set of blind rams. Four (4) 3-1/16" 15,000-psi
WP flanged outlets, flanged top and bottom, H2S trim.
(3) Additional Rams: One (1) set of Shearing Blind Rams, One (1) set of 31/2"
--------------- Pipe Rams, One (1) set of 9 5/8" casing rams, One (1)
set of 7 5/8" casing rams, One (1) set of 7" casing
rams, One (1) set of 31/2" x 5" VBR rams.
b. 13 5/8" X 15,000 Blow-Out Preventers
---------------------------------------------
(1) Annular: One (1) Cameron type DL spherical preventer, 10,000 WP
-------
with 10,000# WP studded top and 15,000# WP flanged
bottom connection, H2S trim.
(2) Rams: One (1) Cameron Type U 15,000-psi W.P. double ram
----
preventer and One (1) Cameron Type U 15,000-psi W.P.
single ram preventer with three (2) sets of 5" pipe rams
and one set of blind rams. Four (4) 3-1/16" 15,000-psi
WP flanged outlets, flanged top and bottom, H2S trim.
c. 21 1/4" 10,000 Blow-Out Preventers
-------------------------------------------
(1) One (1) ▇▇▇▇▇▇▇ wedge top spherical preventer, 5,000 with 5,000 WP studded
top and 10,000 WP flanged bottom connection, H2S trim.
(2) Two (2) Cameron Type U 10,000 # WP single ram preventers, flanged top and
bottom, with 41/16 10,000 WP side outlets. Complete with one (1) set of 5"
straight bore pipe rams, one (1) set of conventional blind rams and one (1) set
of blind shear rams.
d. Choke and Kill Valves
------------------------------
Choke Line Valves: Two (2) 3-1/16" - 10,000 psi gate valves. One hydraulic,
one manual. H2S trim.
Kill Line Valves: Two (2) 3-1/16" x 10,000-psi gate valves, one manual,
one hydraulic. H2S trim.
e. Diverter System
------------------------
One (1) ABB Vetco ▇▇▇▇ KFDJ-J-2000 permanent diverter
system, with ABB Offshore Systems Diverter panel with
auto open feature.
7
SECTION 7
DRILLING UNIT, EQUIPMENT, SUPPLIES
PAGE 8 OF 9
================================================================================
f. Choke Manifold
-----------------------
Cameron 3-1/16" - 15,000 psi WP with two (2) Cameron
hydraulically adjustable choke, two (2) manual
chokes.
g. Mud Gas Separator
--------------------------
▇▇▇▇▇▇ 48" diameter X 18' long mud gas separator,
with dual 6" inlets, 10" mud discharge and 8" gas
discharge vent line piped to crown. Pressure rating
125 psig.
h. BOP Control System
---------------------------
3,000 psi, Massco/▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, Model SSB2403S11 Control Unit.
(1) Twenty-four (24) -11 gal. bladder type accumulators
(2) One (1) 25 HP triplex pump and three (3) 60:1 -- 8-1/2" air pumps
(3) Nine (9) station control manifold with two (3) remote electric operated stations.
i. Instrumentation
------------------------
One (1) HITEC/National Driller's Control Station with HITEC SDI 120
Instrumentation Package equipped with CCTV system for monitoring racking and
stabbing boards.
ii. Air Hoists
-------------------
Two (2) Ram Winch K6UL air hoists on rig floor, 15,000 lb. pull @ 51 fpm.
Two (2) Airdyne model ML 336-38 dedicated man rider winches. One mounted on the
drill floor and one mounted below the drill floor.
Four (4) Ram Winch K6UL air hoist under substructure for BOP manoeuvres.
iii. Drilling Line
----------------------
7,500' of 1-5/8" 6 x 19 EIPS IWRC regular right lay.
16. Wireline Unit
----------------------
One (1) ▇▇▇▇▇▇ "Surveyor" Wireline Unit with 30,000 ft. of .108" wire.
17. Drive Pipe Support System
------------------------------
One (1) Drive Pipe Support System with tensioning capability
to tension drive pipe to 300 kips vertical force and provide
lateral restraint at wellhead.
18. Tubulars
-------------
25,000' (approximately 800 joints) 51/2" O.D., 21.90 lb/ft,
S-135 drill pipe with HTSJ connections 7" O.D. X 33/4" I.D.
Grant Prideco x-metal 7000 hard banding on box and pin tool
joints 3/32" raised.
Thirty (30) joints 51/2" O.D. conventional Hevi-Wate drill
pipe with HT55 connections 7"
O.D. X 3 15/16" I.D. Weight 1,800 lb/per joint
Six (6) 9 1/2" OD drill collars with 7 5/8" Regular
connections.
Nine (9) 8" OD drill collars with 6-5/8" Regular connections.
Twenty One (21) 6 1/2" OD drill collars with 4 1/2" X-Hole
connections. Necessary X-Over Subs, ▇▇▇▇▇ Subs, and Bit Subs
for Contractor's drill string.
8
SECTION 7
DRILLING UNIT, EQUIPMENT, SUPPLIES
PAGE 9 OF 9
================================================================================
19. Mud Buckets
----------------
One (1) P-Quip Hydraulic Mud Bucket complete with air hoses,
connections, side seals and end seals for 5" & 5 1/2" drill
pipe.
F. COMMUNICATIONS EQUIPMENT
--------------------------------------------------------------------------------
1. Radio Equipment
---------------
a. Two (2) fixed marine VHF transceivers, four (4)
survival craft transceivers, six (6) hand held marine
VHF transceivers.
b. One (1) VHF-AM aeronautical base station transceiver
capable of 6-channel operation, with crystals for 3
channels installed, unity gain ground plane antenna,
and manual, 115 VAC.
c. One (1) Global Maritime Distress & Safety System
(GMDSS) as per SOLAS Regulations 5, 6, Part C.
d. Satellite communications and data transfer.
2. Internal Telephone Communications and Public Address System
-----------------------------------------------------------
One (1) Multi-station Gaitronics System for platform
intercommunication.
3. File Server, Computer, and External Communications System
---------------------------------------------------------
Rig LAN digital computer and telecommunications system.
Microwave or Satellite voice and data links from offices,
drill floor, conference room, and the rig LAN. Additional
capabilities of the computer and link system (CORIS) include:
a. Customer and contractor offices on board rig have
access to drilling and performance data in
"real-time" personnel information, liquid and bulk
variable inventories, and weather.
b. Internet access provided to certain computers for
E-mail and file transfer.
c. Above data available via CORIS system.
9
CONTRACT SUMMARY
--------------------------------------- ---------------------------------------------------------------------
Contract No. C-2600
--------------------------------------- ---------------------------------------------------------------------
--------------------------------------- ---------------------------------------------------------------------
Nature of Contract: Hire of Drilling Unit
--------------------------------------- ---------------------------------------------------------------------
--------------------------------------- ---------------------------------------------------------------------
Parties: BP Trinidad and Tobago LLC and ▇▇▇▇▇▇ Offshore Inc.
--------------------------------------- ---------------------------------------------------------------------
--------------------------------------- ---------------------------------------------------------------------
Effective Date: The date that the DRILLING UNIT is under tight tow to Pascagoula,
Mississippi to begin the Make Ready Period (July 10, 2001)
--------------------------------------- ---------------------------------------------------------------------
--------------------------------------- ---------------------------------------------------------------------
Commencement Date: The date on which the DRILLING UNIT is pinned on the first LOCATION
in the CONTRACT AREA and the OPERATOR provided RIG ACCEPTANCE.
--------------------------------------- ---------------------------------------------------------------------
--------------------------------------- ---------------------------------------------------------------------
Term: Three Years from Commencement Date
--------------------------------------- ---------------------------------------------------------------------
--------------------------------------- ---------------------------------------------------------------------
Description of Services/ To carry out drilling services in support BP Trinidad
Scope of Work: and Tobago LLC's Drilling Program
--------------------------------------- ---------------------------------------------------------------------
--------------------------------------- ---------------------------------------------------------------------
Compensation: Mobilisation: US $3,600,000
Day Rate: US $73,000
Demobilisation: US $2,800,000
--------------------------------------- ---------------------------------------------------------------------
--------------------------------------- ---------------------------------------------------------------------
Payment Terms: Thirty Days from Receipt of Invoice
--------------------------------------- ---------------------------------------------------------------------
--------------------------------------- ---------------------------------------------------------------------
Termination: Without Cause - three months notice - 60% of Day Rate for the
remainder of the term ($43,800)
--------------------------------------- ---------------------------------------------------------------------
--------------------------------------- ---------------------------------------------------------------------
Estimated Value of Contract $79,935,000
--------------------------------------- ---------------------------------------------------------------------
--------------------------------------- ---------------------------------------------------------------------
Distribution:
--------------------------------------- ---------------------------------------------------------------------