CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

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CONTRACT NO. POUK/C2394

 

BETWEEN

 

PREMIER OIL UK LIMITED

 

AND

 

OCEAN POWER TECHOLOGIES, INC.

 

FOR THE PROVISION OF INTELLIGENT MONITORING BUOY

 

………………………………………………….

 

Approved by COMPANY.............Approved by CONTRACTOR.............

 

 

CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

 

 

PAGE INTENTIONALLY LEFT BLANK FOR DOUBLE SIDED PRINTING

 

 

 

 

Approved by COMPANY.............Approved by CONTRACTOR.............

 

 

CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

SECTION I

 

FORM OF AGREEMENT INCLUDING APPENDIX 1

 

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CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

FORM OF AGREEMENT

 

This CONTRACT is made between the following parties:

 

PREMIER OIL UK LIMITED, a company incorporated in Scotland (company number
SCO48705) having its registered office at 4th Floor, Saltire Court, 20 Castle
Terrace, Edinburgh EH1 2EN and its principal place of business at Upper Denburn
House, Prime Four Business Park, Kingswells Causeway, Kingswells, Aberdeen AB15
8PU hereinafter called the COMPANY

 

and

 

OCEAN POWER TECHNOLOGIES, INC., a company incorporated in the State of Delaware,
United States of America (Company Registration Number is US Federal ID:
22-2535818 with its registered office at 28 Engelhard Drive, Monroe Township,
New Jersey, USA 08534hereinafter called the CONTRACTOR

 

(together referred to as the “PARTIES” and individually as a “PARTY”).

 

WHEREAS:

 

  1. the COMPANY wishes that certain WORK be carried out in accordance with the
terms and conditions of this CONTRACT; and         2. the CONTRACTOR wishes to
carry out the WORK in accordance with the terms and conditions of this CONTRACT.
          COMPANY wishes that WORK shall be carried out, all as described in the
CONTRACT, via authorisation with the issue of a PURCHASE ORDER.

 

NOW:

 

The PARTIES hereby agree as follows:

 

  1. In this CONTRACT all capitalised words and expressions shall have the
meanings assigned to them in this FORM OF AGREEMENT or elsewhere in the
CONTRACT.         2. The following Sections shall be deemed to form and be read
and construed as part of the CONTRACT:

 

  Section I Form of Agreement including Appendix 1

 

  Section II (A) Standard Contracts for the UK Offshore Oil and Gas Industry -
General Conditions of Contract for Services (On- and Off-shore) - Edition 3 -
2014             (B) Special Conditions of Contract

 

  Section III Remuneration         Section IV Scope of Work         Section V
Health, Safety and Environment         Section VI Administration Instructions

 

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CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

  Exhibit 1 PB3 PowerBuoy Technical Specification         Exhibit 2 CONTRACT
Milestones

 

The Sections shall be read as one document, the contents of which, in the event
of ambiguity or contradiction between Sections, shall be given precedence in the
order listed, with the exception that the Special Conditions of Contract shall
take precedence over the General Conditions of Contract.

 

  3. In accordance with the terms and conditions of the CONTRACT, the CONTRACTOR
shall perform and complete the WORK and the COMPANY shall pay the CONTRACT
PRICE.         4. The terms and conditions of the CONTRACT shall apply from the
date specified in Appendix 1 to this Section I - Form of Agreement which date
shall be the EFFECTIVE DATE OF COMMENCEMENT OF THE CONTRACT.         5. The
duration of the CONTRACT shall be as set out in Appendix 1 to this Section I -
Form of Agreement.

 

The authorised representatives of the PARTIES have executed the CONTRACT in
duplicate upon the dates indicated below:

 

For: OCEAN POWER TECHNOLOGIES, INC.   For: PREMIER OIL UK LIMITED            
(CONTRACTOR)     (COMPANY)

 

  /s/ George H. Kirby III   /s/ Calum Knowles  Name: George H. Kirby III   Name:
Calum Knowles Title : President & CEO   Title : Senior Contracts Engineer Date :
6/26/18   Date : 6/27/18

 

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CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

APPENDIX 1 TO SECTION I - FORM OF AGREEMENT

 

Reference

 

Section I

 

Clause 4 The EFFECTIVE DATE OF COMMENCEMENT OF THE CONTRACT is June 13, 2018    
Clause 5 The CONTRACT shall commence on the EFFECTIVE DATE and shall continue
through the RENTAL PERIOD (as that term is defined in Section III.7), which
RENTAL PERIOD is anticipated to be nine (9) months (a combination of three (3)
months initial trial period with a six (6) month option period to extend in
direct continuation) with one (1) three (3) month option period. Both option
periods to be exercised entirely at COMPANY’s discretion.       Key milestone
dates and other relevant information for this CONTRACT, including but not
limited to the success criteria for the three (3) months initial trial period,
are set forth in Exhibit 2.     Section II       Clause 3.1(a) The COMPANY
REPRESENTATIVE is Pieter voor de Poorte       The CONTRACTOR REPRESENTATIVE is
Chris Phebus     Clause 5.1 The COMPANY designated heliport is Dyce, Aberdeen  
    The COMPANY designated supply base is Peterson SBS Aberdeen or Edzell      
COMPANY reserves the right to nominate designated locations which may be revised
as per instructions issued from time to time.     Clause 10.2 (b) The Defects
Correction Period applies prior to and during the RENTAL PERIOD (as defined in
Section III.7)     Clause 13.8 The period of suspension is twenty eight (28)
days     Clause 14.3 Latest time for receipt of invoices after completion of the
whole of the WORK shall be three (3) months after completion of the WORK.    
Clause 14.9 Interest rate per annum - Base Rate plus three percent (3%) pa    
Clause 17.4 Rights shall vest in CONTRACTOR     Clause 19.2(d) Permanent third
party oil and gas production facilities and pipelines as follows: NONE        
Clause 20.2 Insurance by CONTRACTOR, the amounts are

 

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CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

Employers Liability: Five Million Pounds (£5,000,000) per occurrence or as
contained in legislation in the particular area in which the WORK is being
performed whichever is the greater

 

General Third Party: Ten Million Pounds (£10,000,000) per single occurrence

 

An all-risk policy of insurance in the amount of €10,000,000 that covers any
damage or loss of the RENTAL EQUIPMENT (as that term is defined in Section
III.7)

 

Clause 27.4(a) (iii) Special Conditions remaining in full force and effect shall
be: All

 

Clause 29.6  The addresses for the service of notices are:

 

  (i) COMPANY     Premier Oil UK Limited     Upper Denburn House     Premier
Four Business Park     Kingswells Causeway     Kingswells     Aberdeen     AB15
8PU           Attention:   Supply Chain Manager    
Email:           L_Notices-uk@premier-oil.com         (ii) CONTRACTOR     Ocean
Power Technologies Inc     28 Engelhard Drive     Monroe Township,     New
Jersey     USA 08534

 

Clause 28.5 (d) The period of suspension is twenty eight (28) days     Clause
30.1 (a) Limitation of Liability, including but not limited to the liability
specified in Section III.7, before the date of completion of the WORK       The
sum is 100% of the PURCHASE ORDER value for the WORK     Clause 30.1 (b)
Limitation of Liability, including but not limited to the liability specified in
Section III.7, after the date of completion of the WORK       The sum is 100% of
the PURCHASE ORDER value for the WORK     Clause 30.2 The limitation period is:
As per statute     Clause 31.1(b) Resolution of disputes. The nominees are:

 

  (i) COMPANY: Supply Chain Manager UKBU         (ii) CONTRACTOR: Chris Phebus,
VP Engineering

 

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CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

SECTION II

 

TERMS AND CONDITIONS OF CONTRACT

 

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CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

SECTION II - (A)

 

GENERAL CONDITIONS OF CONTRACT

 

PROVISION OF ON/OFF SHORE SERVICES

 

The General Conditions of Contract for the UK Offshore Oil and Gas Industry
(issued under the auspices of LOGIC) - On- Off-shore Edition 3 dated March 2014
shall apply to the WORK performed under this CONTRACT subject to the Special
Conditions contained in Section II (B).

 

For the avoidance of doubt the Guidance Notes of the General Conditions of
Contract do not form part of the General Conditions and are not to be taken as a
legal interpretation of the General Conditions.

 

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CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

SECTION II – (B)

SPECIAL CONDITIONS OF CONTRACT

 

 

Clause   Special Conditions      

Clause 1.4

COMPANY GROUP

 

Delete the definition and replace with the following:

“COMPANY GROUP” means

(a)    COMPANY and its AFFILIATES

(b)    CO-VENTURERS and their AFFILIATES

(c)    COMPANY’s other contractors of any tier (other than CONTRACTOR or any
member of CONTRACTOR GROUP) and their AFFILIATES; and the respective directors,
officers and employees (including agency personnel) of all of the foregoing.

 

Clause 1.9

CONTRACTOR GROUP

 

 

Insert the words “of any tier” after “SUBCONTRACTORS” on line 1.

 

Delete the second sentence from “CONTRACTOR GROUP shall...” to “agency
personnel).” in its entirety.

 

Clause 1.12

SUBCONTRACT

 

Delete existing Clause 1.12 and replace with the following:

 

“SUBCONTRACT” means any contract between the CONTRACTOR and any person (other
than COMPANY or any employees of the CONTRACTOR) or between SUBCONTRACTORS of
any tier for the performance of any part of the WORK.”

 

Clause 1.18 (new)

PURCHASE ORDER

 

“PURCHASE ORDER” shall mean the document issued by COMPANY to CONTRACTOR, in
accordance with the CONTRACT, detailing the specific WORK authorised under the
CONTRACT to be carried out at that time. A specimen PURCHASE ORDER is provided
in SECTION V Administration Instructions, Attachment 1. The PURCHASE ORDER shall
not contain any terms or conditions that are not already addressed in the
CONTRACT, and the PURCHASE ORDER shall not add to, change, modify, replace or
otherwise vary any terms or conditions addressed in the CONTRACT.

 

Clause 3.2 (a)

COMPANY AND CONTRACTOR REPRESENTATIVES 

 

 

Delete the first word of this clause and replace with: “Only the”

 

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CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

Clause   Special Conditions      

Clause 7.2

CONTRACTOR TO INFORM COMPANY/COMPANY TO INFORM CONTRACTOR

 

At the end of the first sentence insert the following new sentence:

“CONTRACTOR shall allow the COMPANY to participate in any investigation into
such accidents and, in any event, shall provide a copy of any accident report
and/or investigation report to the COMPANY as soon as reports become available.

 

     

Clause 8.2

SUBCONTRACTING

 

Insert new Clause 8.2(e) as follows:

 

“(e) CONTRACTOR shall provide that any SUBCONTRACT entered into by CONTRACTOR
shall contain as a minimum provisions effectively the same as those contained in
Clauses 13,16,17,18,19, 20, 21, 22,24,27,28 and 33 of the CONTRACT.”

 

Clause 10.2 (b)

DEFECTS CORRECTION

 

Add to the end of the first paragraph of this Clause:

“,at its sole cost and expense”

 

Clause 13.1 (c)

SUSPENSION

 

 

Delete 13.1(c) in its entirety and replace with:

“The COMPANY shall have the right, by notice to the CONTRACTOR, to suspend the
WORK or any part thereof to the extent detailed in the notice to suit the
convenience of the COMPANY; however, any suspension of the WORK, or any part
thereof, to suit convenience of COMPANY shall continue for a period of time not
to exceed fourteen (14) calendar days. Thereafter, the suspended WORK or any
part thereof shall resume unless the COMPANY proceeds in accordance with the
termination provisions contained in LOGIC Clause 24 as modified by the CONTRACT.
The COMPANY’s right to suspend the WORK or any part thereof pursuant to LOGIC
Clause 13.1 (a) (addressing safety) are not subject to the 14 calendar days
limitation set forth above.

 

Clause 13.2 (b)   After “COMPANY” insert “and shall use all reasonable
endeavours to minimize COMPANY’s costs and expenditure during suspension.”

 

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CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

Clause   Special Conditions      

Clause 20.1

INSURANCE

 

In line 7 and in line 10/11 delete “COMPANY, CO-VENTURERS and its and their
respective AFFILATES” and replace with “COMPANY GROUP”

 

Clause 24.1 (a)

TERMINATION

 

 

 

(i)            The COMPANY shall have the right by giving notice to terminate
all or part of the WORK or the CONTRACT at such time or times as the COMPANY may
consider necessary to suit the convenience of the COMPANY; however, any
termination of the WORK or the CONTRACT to suit the convenience of the COMPANY
shall, subject to Clause 24.1(a) (ii) below, only apply prior to the
commencement of the shipment of the PB3 PowerBuoy from the CONTRACTOR’s facility
in the United States to the COMPANY’s WORKSITE in the United Kingdom.
Thereafter, the COMPANY may only terminate all or part of the WORK or the
CONTRACT at such time as the COMPANY may consider necessary pursuant to Clause
24.1(b) (addressing fault) or Clause 24.1(c) (Addressing bankruptcy).

(ii)           COMPANY has the right to terminate the CONTRACT at the end of the
initial three (3) month trial period.

 

Clause 24.3 (a)

TERMINATION

 

 

After “notice”, and prior to the semi-colon insert:

“in a prompt and orderly manner with the purpose of mitigating losses,
minimising further expenditures and minimising disruptions to COMPANY’s ongoing
operations.”

 

Clause 34 (new)  

Insert the following new Clause:

34. INDUSTRY MUTUAL HOLD HARMLESS SCHEME

 

CONTRACTOR shall be and shall ensure that any SUBCONTRACTOR is a signatory to
the Industry Mutual Hold Harmless scheme.

 

Clause 35 (new)

APPOINTMENT OF SERVICE AGENT

 

Insert the following new Clause:

35. APPOINTMENT OF SERVICE AGENT

“CONTRACTOR hereby irrevocably authorises and appoints Ocean Power Technologies,
Ltd., located at 23-25 Waterloo Place, Lemington Spa, Warwickshire, CV32 5LA,
United Kingdom as its agent to accept on its behalf service of all legal process
in England in relation to any dispute arising out of this CONTRACT and any
VARIATIONS. Nothing in this clause shall affect COMPANY’s right to serve process
in any other manner permitted by law or the right to bring proceedings in any
other jurisdiction for the purposes of enforcement or execution of any judgement
or other settlement in any other courts.” 

 

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CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

SECTION III

 

REMUNERATION

 

A REMUNERATION

 

1.0GENERAL

 

1.1. The primary purpose of this Section III – Remuneration is to establish a
pricing structure for the provision of WORK, as detailed within Section IV –
Scope of Work, together with all relevant specifications applicable to same,
determined against an agreed pricing and discount arrangement, that will apply
for the duration of the CONTRACT, as authorised with any PURCHASE ORDER issued
in accordance with same.     1.2. In full consideration of the satisfactory
performance of the WORK by the CONTRATOR in complying with its obligations under
the CONTRACT, the COMPANY agrees to pay, or cause to be paid to the CONTRACTOR,
the CONTRACT PRICE, at the times and in the manner specified in the CONTRACT and
as authorised with the relevant PURCHASE ORDER, as appropriate.     1.3. The
CONTRACT PRICE shall consist of only the rates and prices as are contained
within this Section III – Remuneration and shall be the full consideration to
the CONTRACTOR for all costs, overheads and profits associated with the WORK and
fulfilling all obligations and liabilities of the CONTRACTOR under the CONTRACT.
All lump sums, unit rates and prices contained within this Section III –
Remuneration are in US Dollars USD($) unless otherwise stated.     1.4. All
lumps sums, unit rates and prices contained herein shall be exclusive of any
incidence of Value Added Tax (VAT) applicable to the WORK undertaken by the
CONTRACTOR for the COMPANY under the CONTRACT. The gross amount of VAT
chargeable thereon shall be paid to the CONTRACTOR by the COMPANY additional to
any other payment due under the CONTRACT, provided always that the CONTRACTOR
supplies the COMPANY with a valid Tax invoice / Certificate as may be required
by relevant statutes or regulations.     1.5. The CONTRACT rates and prices
shall be calculated in accordance with this Section III     1.6 The CONTRACTOR
shall invoice the COMPANY on the basis of the applicable lump sums, unit rates,
and prices detailed in this Section III – Remuneration in accordance with the
provisions of the CONTRACT as authorised in the relevant PURCHASE ORDER, as
appropriate.     1.7 No reimbursement will be made for the WORK which is not
performed in accordance with the CONTRACT.     1.8  The CONTRACTOR shall not be
entitled to remuneration in respect of personnel or equipment time incurred
non-productively:

 

  (a) Through shortages or delays in the supply by the CONTRACTOR GROUP of
personnel, equipment, information or materials, provided that the COMPANY shall
have given to the CONTRACTOR adequate notice of the need for such supply; and/or
        (b) Due to a lack of planning on the part of the CONTRACTOR; and/or    
 

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CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

  (c) for time incurred non-productively through breakdown or loss of the
CONTRACTOR GROUP’s equipment or plant; and/or         (d) through materials
being non-compliant with the WORK requirements, in accordance with the
provisions of the CONTRACT.

 

1.9 No claim or submission for additional monies will be accepted by the COMPANY
for failure to price an item identifiable from Section IV- Scope of Work or
other CONTRACT documents but not specifically identified herein, or for any item
which proves to be required for the safe and proper performance of the WORK or
to satisfy the requirements of any approving authority.     1.10 The
CONTRACTOR’s schedules of personnel, equipment and consumables contained within
this Section III – Remuneration are deemed to be total and complete. No other
charges will be accepted or authorised unless the CONTRACTOR received prior
written agreement from the COMPANY.     1.11 Unless otherwise stated herein,
“Day” or “day” shall mean a period of twenty-four (24) hours beginning at 00:00
hours on any day and ending at 24:00 hours on the same day.     1.12 All
invoices submitted on the basis of the rates detailed within this Section III –
Remuneration shall be supported by CONTRACTOR approved personnel timesheets,
plant sheets and shipping manifest where applicable.     1.13 All third party
supplier invoices shall be submitted by CONTRACTOR to COMPANY within 30 days of
the end of each calendar month for WORK carried out in such calendar month.

 

2.0PREAMBLE TO LUMP SUMS AND UNIT RATES

 

The lump sums, unit rates and prices included in this Section III – Remuneration
shall be all-inclusive fixed for the WORK as specified in Section IV – Scope of
Work, all in accordance with the CONTRACT and as authorised in the applicable
PURCHASE ORDER, and shall include without limitation the cost of the following:

 

  i) Provision of all necessary project management and engineering, design,
draughting and other technical services for the WORK, all as more fully
described in Section IV – Scope of WORK;         ii) The WORK as described in
Section IV – Scope of WORK, attached;         iii) Provision (including
MOBILISATION, operation and DEMOBILISATION) of all personnel, materials and
equipment required for full performance of the WORK;         iv) Maintenance,
repair and replacement of all necessary working equipment required for the
execution of the WORK;         v) Provision of onshore facilities and services
to support the WORK;         vi) Loading of CONTRACTOR’s materials and equipment
onto COMPANY transport for delivery to COMPANY supply base and off-loading upon
its return from offshore – all to COMPANY’s account;         vii) Provision of
all documents that may be required by Customs and Excise, Port Authorities and
any other statutory body with jurisdiction or requirements in connection with
CONTRACTOR’s equipment and materials;

 

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CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

  viii) All consumable items and those not incorporated into the WORK, including
materials, supplies, welding rods, facilities, maintenance and running costs for
construction, plant, workshops, other buildings, construction equipment,
craneage, hoists, loadout apparatus, power generation equipment, temporary
construction aids, shelters, vehicles, protective clothing for CONTRACTOR’s
personnel and any other equipment or facilities to be utilised;

 

  ix) Compliance with all safety and medical requirements, and safety and
survival training for CONTRACTOR’s personnel and the provision to CONTRACTOR
personnel offshore for all safety, protective and survival clothing and
equipment, and medical check-ups, and obtaining all medical and training
certificates;         x) All labour, materials, consumables and on-site services
relating to inspection, and testing specifically called for by this CONTRACT,
and any other tests considered necessary by CONTRACTOR;         xi) Procurement,
expediting, inspection, purchase, documentation, unloading, handling, storage,
preserving and protection, packing, transportation and incorporation
(permanently or temporarily) into the WORKS of all equipment and materials
associated with the WORK;         xii) The provision of all spares and
consumables required during testing, Factory Acceptance Tests of any procured or
repaired equipment including any testing / analysis equipment;         xiii) The
provision of all installation material spares including, but not limited to
bolts and gaskets.         xiv) Provision and installation of all protection
materials necessary, whether of a temporary or permanent nature;         xv) The
provision of all permits, licences and other authorisations required to operate
the CONTRACTOR’s equipment;         xvi) Compliance with the requirements of
COMPANY’s approved Verification Body (VB) to review and approve all detailed
design activities, monitor construction activities and issue a statement of
compliance for equipment and operations that will meet the requirements of
COMPANY;         xvii) The provision of all permits, licences and other
authorisations required to perform the WORK;         xviii) Compliance with the
requirements of the United Kingdom DBERR, and H.S.E;         xix) Compliance
with and the provision of all necessary details in accordance with the “F” Gas
Regulations;         xx) Compliance with the requirements of the Civil Aviation
Authority with regard to personnel fitness for travel;         xxi) Royalties,
patent and licence fees, usage of proprietary information and systems and
similar items;         xxii) Provision and maintenance of CONTRACTOR’s QA/QC
system and EN BS ISO 9000 registration;

 

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CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

  xxiii) Development and implementation of all planning, cost, QA, materials and
document controls;

 

  xxiv) Preparation of a Quality Plan for COMPANY APPROVAL describing the
resources and activities which shall be employed to achieve the quality
objectives for the WORK;         xxv) Provision of SUBCONTRACT WORK, services
and personnel of either a technical or professional nature as required;        
xxvi) Attendance of CONTRACTOR’s personnel at all meetings required by COMPANY
and all costs associated therewith;         xxvii) Production of all drawings
and specifications, reproducing such drawings and specifications as required and
COMPLETION of scope drawings as required by COMPANY in both hard copy and
electronic format;         xxviii) All documentation including operations and
maintenance manuals for COMPANY approval, a verification manual for Independent
Inspection Authority (IIA), and complete set of “As-built” drawings,
certification and reports wherever appropriate;         xxix) Provision of all
tools including hand tools;         xxx) Provision for onshore and offshore WORK
of all direct, indirect, productive and non-productive labour, supervision,
staff and management as are required for full performance of the WORK, including
all wages and base salaries relating to normal, overtime, weekend, holiday or
shift hours (whether day or night) and associated payroll burdens (including but
not limited to premium payments, bonuses [including divers’ saturation premium
and staff benefits], National Insurance Contributions and other payroll taxes,
private health plan(s), pensions, employers’ liability or other insurances,
sickness benefit, redundancy payments, industrial training levies, holidays, and
all costs of crew changes, accommodation and living expenses, relocation and
travel (so far as not expressly found to the contrary elsewhere within the
CONTRACT) to achieve the completion of the WORK;         xxxi) All of
CONTRACTOR’s overheads or other cost including but not limited to finance costs,
depreciation, costs of non-chargeable staff and management, CONTRACTOR vehicles,
administrative, legal, insurance, accounting, tax advisory, auditing, finance,
marketing, computing, clerical and secretarial services, materials, consumables,
utilities, stationery, and telefax facilities and usage, graphics, draughting
(including CAD), reproduction, electronic mail (including the provision of
Microsoft Office system) and other network computer facilities arising out of
its corporate head office or other offices at which the WORK is being performed;
        xxxii) Maintenance of buildings, workshops, offices, plant and equipment
and all other parts and items in CONTRACTOR’s onshore site facility in a safe
and operational condition including labour, materials, spare parts and other
services;         xxxiii) Provision of any buildings, offices, workshops and
other facilities (including site preparation and temporary WORKS) as required to
complete the WORK and services hereto;         xxxiv) All travel, subsistence
and associated costs including but not limited to hotel accommodation, air
travel, taxi, car hire, meals and the like (so far as not expressly found to the
contrary elsewhere in the CONTRACT) – travel and accommodation for CONTRACTOR
personnel to be reimbursed as expensed;

 

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CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

  xxxv) Provision of a Performance Bond and/or Parent Company Guarantee in
accordance with the provisions of the CONTRACT (not required);         xxxvi)
Provision of CONTRACTOR’s insurance cover as required by the CONTRACT, including
all associated costs;         xxxvii) The cost of any deductibles associated
with claims made against COMPANY’s Construction All Risks or other Insurance
Policy;         xxxviii) All remedial WORK necessary for compliance with the
requirements of the CONTRACT;         xxxix) Any costs associated with the
free-issue materials and equipment;         xl) All other overheads, risks,
depreciation, expenses, liabilities and obligations which under the terms of the
CONTRACT are to be borne by CONTRACTOR and other risks which CONTRACTOR could
reasonably expect to bear in the performance of the WORK, and compliance with
the CONTRACT articles generally;         xli) CONTRACTOR’s profit;         xlii)
COMPANY shall not consider any request for additional reimbursement for loss of
revenue, overheads or profit as a result of any, omission or addition due to the
method which the CONTRACTOR has used to determine the CONTRACT PRICE.        
xliii) The Manhour Rates shall apply to any applicable VARIATION under the
Contract and shall include but not be limited to:

 

  ● All wages and salaries relating to normal, weekend, holiday or shift hours
(whether day or night), overtime premiums, National Insurance contributions,
private health plan, pensions, employer’s liability or other insurance, sickness
benefit, holidays and bonuses;         ● Onshore hourly rates shall be
reimbursed for the actual number of hours worked, as approved by COMPANY by
means of timesheets;         ● Offshore day rates shall be reimbursed for each
day CONTRACTOR’s personnel are offshore, as approved by COMPANY by means of
timesheets. Part days shall be pro-rated.

 

  xliv) The day rates shall be inclusive of the items and activities specified
herein and as detailed in Section IV – Scope of WORK.         xlv) The daily
stand-by rates shall be payable, providing that in all respects the CONTRACTOR
had programmed, was ready and available for work and shall be deemed to cover
all costs and expenses incurred during a 24 hour period. Any stand-by occurring
for less than 24 hours per day shall be reimbursed pro-rata from the day rate
based on a 24-hour day; reimbursement shall be to the nearest half hour.        
xlvi) DELETED         xlvii) The day rates shall not be payable in the event
that the CONTRACT is suspended due to the negligence or fault of CONTRACTOR
pursuant to the CONTRACT.         xlviii) In the event of award of CONTRACT,
this shall be duplicated into Section III – Remuneration of the Pro Forma
Contract and form part of CONTRACT.

 

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CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

3.0ONSHORE AND OFFSHORE PERSONNEL

 

3.1 The onshore and offshore personnel rates quotes shall be for personnel
working on any UK and/or UKCS WORKSITE.     3.2 All accommodation and
subsistence at the COMPANY’s offshore WORKSITE shall be to the COMPANY’s
account.     3.3 The offshore day rate for the CONTRACTOR GROUP’s personnel
shall be paid from the time of scheduled check-in at the COMPANY’s mobilisation
point, en route to the offshore location, until return to same. The only
exceptions to this are on ‘Mobilisation’ and ‘Demobilisation’ days, being the
crew change days. On crew change days, a charge for one (1) of the CONTRACTOR
GROUPs personnel only, will be accepted by the COMPANY (i.e. outgoing CONTRACTOR
GROUP’s personnel will be reimbursed but not the incoming CONTRACTOR personnel
on crew rotation). Subject to normal operating requirements, the COMPANY will
transport the CONTRACTOR GROUP’s personnel between the mobilisation point and
the offshore WORKSITE. Such transportation shall at all times be at the
COMPANY’s discretion.     3.4 In the event of any delay in departure from the
mobilisation point to the offshore WORKSITE, the CONTRACTOR GROUP’s personnel
shall remain at the mobilisation point until stood down by the COMPANY. Should
such delay result in the CONTRACTOR GROUP’s personnel remaining on standby
overnight, the COMPANY (to suite operational requirements) shall reimburse the
CONTRACTOR an agreed lump sum per night to cover accommodation in Aberdeen,
meals and transportation to/from the accommodation and heliport, for those
CONTRACTOR GROUP personnel normally not residing locally i.e. outwith a forty
(40) mile radius of the mobilisation point. Such payments will be progressed in
accordance with the applicable provisions of Section III – Remuneration.     3.5
The COMPANY shall be responsible for arranging meals, accommodation and
transport as appropriate, all to its account if the helicopter having taken off
from the drilling unit and/or other associated intervention vessel diverts to
land at a location other than Aberdeen.     3.6 The COMPANY shall be liable for
any documented costs incurred by the CONTRACTOR GROUP’s from the scheduled
check-in time or subsequent to the disembarkation of the CONTRACTOR GROUP’s
personnel at the designated demobilisation point, located in Aberdeen.     3.7
For the avoidance of doubt, the offshore working day shall be for a minimum
twelve (12) hour day, and any hours worked in excess of this on any particular
day shall be deemed to be included in the pertinent offshore daily rate.     3.8
The onshore daily rate(s) contained within this Section III – Remuneration,
shall apply for each eight (8) hour day spent productively working onshore. In
the event that only partial day is worked, then reimbursement shall be made on a
pro-rata basis. In the event that more than eight (8) hours are worked in the
same day, then such hours (over the nominal eight (8) hours) are deemed to be
included in the pertinent onshore personnel day rate, and the COMPANY shall not
be liable for any overtime charges. The only exception to this would be where
specific overtime work is authorised in writing in advance by the COMPANY
REPRESENTATIVE, and where a schedule of pertinent overtime rates per hour worked
for each personnel category is agreed between both PARTIES.

 

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CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

3.9 CONTRACTOR shall not remove, replace or transfer any personnel without prior
agreement of COMPANY. CONTRACTOR shall submit complete resumes of all personnel
to COMPANY for review prior to assigning personnel to the CONTRACT. COMPANY
retains the right to remove any of CONTRACTOR’s personnel for lack of
performance or irregular conduct.

 

4.0PLANT / EQUIPMENT / MATERIALS / TOOLS ETC (NOT USED – SEE 7.0 BELOW )

 

(SECTION DELETED)

 

5.0THIRD PARTY MATERIALS AND SERVICES

 

The COMPANY shall reimburse the CONTRACTOR for the provision of third party
goods and services at actual net documented cost, provided that such goods and
services:

 

  (a) Are required solely for the performance of the WORK being additional to
that specified or referred to in Section IV – Scope of Work and which are not
included in Section III – Remuneration         (b) Have been requested by the
COMPANY in advance in writing; and,         (c) Have been provided at
demonstrably competitive rates, sums or prices.

 

6.0CLAIMS

 

COMPANY will not be obliged to consider any claim by CONTRACTOR unless the
following procedure is strictly adhered to:

 

  (a) CONTRACTOR will submit written notice to COMPANY within twenty-eight (28)
days of the occurrence constituting such claim.         And           (b)
CONTRACTOR will submit to COMPANY a written detailed statement of any such
claim, which may be subject to audit, within sixty (60) days of the occurrence
constituting such claim.

 

Claim submissions identified outside the time scale described above shall be
considered to be time barred.

 

7.0 RENTAL EQUIPMENT

 

“RENTAL EQUIPMENT” means the PB3 PowerBuoy as specified in Exhibit 1 of the
CONTRACT and any substitutions or replacements of the PB3 PowerBuoy and all
related accessories (other than those provided by the COMPANY), and any manuals
and instructions as may be appropriate.

 

“RENTAL PERIOD” means that period of time beginning when RENTAL EQUIPMENT is
delivered to COMPANY’s designated place of delivery, specified in Exhibit 2, and
ending when such RENTAL EQUIPMENT is returned to COMPANY’s designated place of
redelivery, specified in Exhibit 2.

 

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CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

7.1 CONTRACTOR represents and warrants to COMPANY that RENTAL EQUIPMENT shall:

 

  (a) comply with the description and any specification or sample specified in
Exhibit 1;   (b) be new or as new and fit for the purpose specified in the
CONTRACT;   (c) be free from defects in design, material and workmanship that
prevent the RENTAL EQUIPMENT from operating or performing as designed or in
accordance with the specifications identified in Exhibit 1;   (d) comply with
all applicable statutory and regulatory requirements relating to manufacture,
testing, calibrating, labelling, packaging, storage, handling and delivery.

 

7.2 CONTRACTOR is hereby put on notice that the RENTAL EQUIPMENT is to be used
offshore by COMPANY. COMPANY is responsible for the offshore deployment and
retrieval of RENTAL EQUIPMENT in accordance with directions and instructions
provided CONTRACTOR.     7.3 Special returnable containers used for the delivery
of RENTAL EQUIPMENT shall be returned to CONTRACTOR upon the delivery and/or
installation of the RENTAL EQUIPMENT.     7.4 Charges in respect of RENTAL
EQUIPMENT used offshore shall, unless otherwise agreed in writing, apply only
during the RENTAL PERIOD. COMPANY shall provide CONTRACTOR with written notice
of the date when the RENTAL PERIOD shall end and such written notice shall be
provided at least 15 calendar days prior to the date when the RENTAL PERIOD
shall end.     7.5 RENTAL EQUIPMENT, and any intellectual property associated
with or embedded within RENTAL EQUIPMENT, shall at all times remain the property
of CONTRACTOR, and COMPANY shall have no right, title or interest in or to
RENTAL EQUIPMENT save the right to possession and use of the RENTAL EQUIPMENT
subject to the terms and conditions of this CONTRACT. COMPANY shall have no
obligation in respect of the RENTAL EQUIPMENT during the RENTAL PERIOD save (a)
to maintain and operate RENTAL EQUIPMENT in accordance with the instructions
provided by CONTRACTOR; (b) to make payment for RENTAL EQUIPMENT as agreed in
the CONTRACT.     7.6 CONTRACTOR waives any right of lien against the RENTAL
EQUIPMENT during the RENTAL PERIOD. CONTRACTOR shall not at any time during the
RENTAL PERIOD suffer or permit any lien, attachment or encumbrance to be imposed
by any PERSON upon any RENTAL EQUIPMENT (or any part thereof) by reason of a
claim or demand against CONTRACTOR.     7.7 COMPANY shall be responsible for the
RENTAL EQUIPMENT during the RENTAL PERIOD and COMPANY acknowledges that
CONTRACTOR shall not be responsible for, and indemnifies CONTRACTOR from any
claims for, any loss of or damage, to third parties arising out of or in
connection with any misuse or mishandling of the RENTAL EQUIPMENT by COMPANY
GROUP during the RENTAL PERIOD.     7.8 Notwithstanding Clause 7.7 above the
RENTAL EQUIPMENT and title thereto shall remain the property of the CONTRACTOR
at all times. Risk of loss or damage to the RENTAL EQUIPMENT shall be with
CONTRACTOR at all times during the term of the CONTRACT, and CONTRACTOR
indemnifies, releases and holds harmless the COMPANY GROUP in respect of loss or
damage to the RENTAL EQUIPMENT irrespective of cause and notwithstanding the
negligence or breach of duty (whether statutory or otherwise) of the COMPANY
GROUP.

 

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CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

B SCHEDULE OF RATES       Any remuneration will be in accordance with each
CONTRACT for WORK (“CONTRACT”), executed by way of a PURCHASE ORDER.     1.0
RATES, SUMS AND PRICE SCHEDULES       CONTRACTOR will detail a full list of
personnel required to perform the WORK as set out in Section IV – Scope of Work
and provide all-inclusive day rates for each and every category.      
CONTRACTOR will provide an exhaustive list of equipment which may be required in
the performance of the WORK as set out in Section IV – Scope of Work and will
provide daily rental rates for each or as agreed with COMPANY REPRESENTATIVE.  
  2.0 GENERAL     2.1 The description of prices contained in this Section III is
for the convenience of CONTRACTOR and COMPANY in the pricing and administration
of payment for the WORK. As such, the descriptions are deemed to represent the
total requirement for the Scope of Work. No claim or submission for additional
compensation shall be accepted by COMPANY on the grounds that CONTRACTOR failed,
or was unable, to price am item of the WORK which could be reasonably identified
from the scope.         2.2 CONTRACTOR shall be responsible for notifying
COMPANY, within seven (7) working days, of all CONTRACTOR equipment which has
not been returned as planned. Failure to notify COMPANY of non-return of
equipment shall result in equipment status being off-hire.     3.0 PRICING    
3.1.1 PRE TRIAL WORK

 

ITEM   LIST PRICE   PRICE TO CUSTOMER   COMMENTS Trial definition and System
design   ***   ***   Assistance to define the functionality and sensors required
Integration of sensors and modification of functionality on software   ***   ***
  Integration of equipment onto the PB3 FAT & system functionality test in house
pre shipment. Sensor NRE in excess of $*** shall be billed at cost Project
management, design/operations meetings & logistics planning   ***   ***  
In-house manpower Delivery of PB3 to Aberdeen   ***   ***   Delivered Quayside
Aberdeen – COMPANY to act as Consignee and All risk insurance policy   ***   ***
  Insurance for any loss or damage to the PB3. The cost of the insurance policy
shall be billed at cost, and any deductibles or retentions required under the
policy for any claims made shall be billed at cost.

 

***This information has been omitted in reliance upon Rule 24b-2 of the
Securities Exchange Act of 1934, as amended, and has been filed separately with
the Securities and Exchange Commission.

 

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CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

3.1.2 INITIAL TRIAL PERIOD – 3 MONTHS

 

ITEM   LIST PRICE   PRICE TO CUSTOMER   COMMENTS Onsite support (2 men x 14
days)   ***   ***   Mobilisation / deployment supervisory and advisory role
Remote monitoring of the system   ***   ***   Initial high intensity monitoring
support of PB3 Training of COMPANY personnel for monitoring of system   ***  
***   To enable COMPANY personnel to monitor the system on day to day basis 3
Month Rental of PB3   ***   ***   Based on single 3 month rental

 

3.1.3 OPTION PERIOD 1 – 6 MONTHS

 

ITEM   LIST PRICE   FIRM PRICE TO CUSTOMER   COMMENTS PB3 Rental for 6 months  
***   ***   Supervisory and advisory role Remote monitoring of the system for 6
months   ***   ***   Monitoring / support for periodic health checks and monthly
reporting Decommissioning of PB3 support services   ***   ***   One man for 14
days max excluding travel & expenses Shipment from Aberdeen to Monroe Township,
NJ   ***   ***   FOB Aberdeen

 

3.1.4 OPTION PERIOD 2 – 3 MONTHS

 

ITEM   OPTION 2 FIRM PRICE   COMMENTS PB3 Rental for 3 months   ***   Optional
extension post 6 month rental period Monthly Rental   ***   Flexibility in case
of shorter / longer extension PB3 Rental for 3 years   ***     PB3 Purchase
Price   ***   PB3 price valid until 31 Dec 2018 Decommissioning of PB3   ***  
One man x 14 days Unscheduled onsite support visit services   ***   Per man day
(min 5 days) excluding travel & expenses Remote monitoring support (post 3 month
  ***   Per month

 

Notes to Pricing:

 

  ● All prices are firm for the duration of the CONTRACT, based in US Dollars
and exclusive of all UK taxes, VAT and customs duties   ● Initial Trial Period
includes four (4) hours of remotely conducted monitoring training for COMPANY
personnel, to be provided remotely by webcast or similar means. Additional
training is additional at cost.   ● Additional deployment site visits post
Initial Trial Period are chargeable to COMPANY

 

***This information has been omitted in reliance upon Rule 24b-2 of the
Securities Exchange Act of 1934, as amended, and has been filed separately with
the Securities and Exchange Commission.

 

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CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

  ● Mooring design services, validation of mooring design, mooring installation
procedures and mooring procurement shall be provided at COMPANY cost.
Verification of mooring design included in Initial Trial Period by CONTRACTOR  
● Subject to COMPANY approval, PB3 rental shall be invoiced one (1) month in
advance, commencing after 3.1.1 Initial Trial Period. The first rental payment
shall include the first and second months rental fee. Thereafter, invoicing
shall be monthly.   ● COMPANY to facilitate the provision of all mooring
equipment and charter of suitable deployment and recovery vessels in accordance
with CONTRACTOR approved PB3 loadout and recovery procedures. Recovery and
deployment of PB3 will be provided for at COMPANY expense and performed under
the supervision and instruction of CONTRACTOR. Permits and authorisations
required for deploying the PB3 shall be obtained and maintained by COMPANY   ●
Sensor NRE costs more than $*** shall be invoiced at net documented cost.   ●
All communication costs, Satcom, 4G shall be to COMPANY’s cost   ● All prices
are exworks CONTRACTOR premises Monroe Township, New Jersey, USA, CONTRACTOR to
arrange delivery based on INCOTERM 2010 DAP to COMPANY designated delivery port
and back charge in advance to COMPANY. All costs associated with quayside
activity, storage and staging, transportation ex Aberdeen shall be provided by
COMPANY at COMPANY’s cost.   ● PB3 standard warranty applies during the Rental
Period (one year parts, labour and expenses), thereafter prices as above,
COMPANY to provide suitable recovery vessel and support services to and from PB3
WORKSITE.   ● Remote monitoring service – initial 3 month trial period, no
charge. High intensity for initial 2 weeks after deployment, reducing gradually
thereafter to basic cover after 1st month (2 hrs per day, plus monthly report of
system performance, performance monitoring, alarm resolution, telephone support
to COMPANY, periodic tuning of the PB3 for maximum power production).   ● Travel
and Lodging shall be reimbursed at Cost +10% (copy of receipts to accompany
invoice and travel expense claim)

 

***This information has been omitted in reliance upon Rule 24b-2 of the
Securities Exchange Act of 1934, as amended, and has been filed separately with
the Securities and Exchange Commission.

 

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CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

SECTION IV

 

SCOPE OF WORK

 

A INTRODUCTION     1.0 GENERAL     1.1 The WORK shall be performed fully in
accordance with the provisions of the CONTRACT as authorised by the relevant
PURCHASE ORDER(s).     1.2 CONTRACTOR shall, upon receipt of a PURCHASE ORDER,
carry out the WORK as required and as described in this Section IV and in
Section III.7.     1.3 The CONTRACTOR warrants that it:         (a) Possesses
the necessary skills, equipment, personnel and organisation to perform the WORK
in a manner satisfactory to the COMPANY and has a verified competency assurance
system in place.         (b) Will conduct all activities in connection with the
WORK in full compliance with all relevant and prevailing statutory requirements,
codes, standards, specifications and regulations as applicable to the WORK.    
    (c) Will conduct all activities in connection with the CONTRACT in full
compliance with all of the COMPANY’s policies, procedures and guidelines which
are now, or may in future become applicable to the CONTRACTOR’s performance of
the WORK, in a manner that is ethical and of the highest integrity, and will not
engage in any form of illegal information brokering.       1.4 The CONTRACTOR
shall ensure that it contacts the COMPANY REPRESENTATIVE to establish which of
the COMPANY’s procedures apply to the WORK and to obtain an up-to-date copy of
such procedures prior to the commencement of the WORK. It shall be the
CONTRACTOR’s responsibility to thereafter ensure that the WORK is at all times
performed, and that any items provided by the CONTRACTOR are, in accordance with
the COMPANY’s procedures, specifications and statutory requirements.       At
the COMPANY’s sole discretion, the CONTRACTOR may be required to propose the
CONTRACTOR’S own procedures or specifications for the COMPANY’s approval and,
once approved, adhere to them for the execution of the WORK.     1.5 During the
term of the CONTRACT, the primary responsibility of both the COMPANY and the
CONTRACTOR is to ensure the safe execution of the WORK. The COMPANY and the
CONTRACTOR shall ensure effective management of all safety and environmental
issues. Priority shall be given to minimising risks and minimising the exposure
of all personnel to risks.     1.6 During the terms of the CONTRACT and as
directed by the COMPANY, the CONTRACTOR REPRESENTATIVE shall have regular
operational meetings with the COMPANY REPRESENTATIVE to discuss and provide
details of the CONTRACTOR’s performance.     2.0 PERSONNEL     2.1 The
CONTRACTOR will, in accordance with the provisions of this CONTRACT, provide the
necessary number of competent and skilled personnel to manage and undertake the
WORK, in accordance with good UKCS oil & gas field practice, all legislative
requirements and the CONTRACT.

 

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CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

2.2 The CONTRACTOR shall provide all necessary management, administrative and
technical support personnel, at the CONTRACTOR’s base, to fully support the
WORK.     2.3 The CONTRACTOR GROUP’s personnel will be capable of
troubleshooting and correcting equipment/tool problems and failures. In the
event that any member of the CONTRACTOR GROUP’s personnel is unable to perform
their duties adequately, or fails to have proper equipment available, the
CONTRACTOR shall replace such personnel, or remedy the situation to the
COMPANY’s satisfaction, at the sole expense of the CONTRACTOR within forty-eight
(48) hours.     2.4 Due to the nature of its activities, the COMPANY expects the
maximum flexibility in the CONTRACTOR’s provision of the WORK. The CONTRACTOR
GROUP’s personnel shall be required to be flexible in working hours, working
relationships and location.     2.5 CONTRACTOR maybe requested to provide
dedicated personnel for the provision of the WORK. Reimbursement shall be
charged at the rates contained within Section III – Reimbursement.     2.6 All
of the COMPANY’s operations will be conducted in English and the CONTRACTOR must
ensure all of the CONTRACTOR GROUP’s personnel are fluent in spoken and written
English. The COMPANY reserves the right to reject any such personnel whose
English is not of a sufficient standard.     2.7 All personnel changes proposed
by the CONTRACTOR must be discussed between the PARTIES and shall only be
completed with the prior written approval of the COMPANY. In addition, KEY
PERSONNEL alterations shall be subject to a management of change process, which
must be agreed by the COMPANY sufficiently in advance, of the commencement of
such a change, so as to permit a mutually satisfactory handover, which shall be
a period of not less than thirty (30) days, to transfer operational knowledge to
the replacement personnel. Replacement personnel shall be of an acceptable
standard with similar experience to that detailed in the original personnel’s
CV.     2.8 The CONTRACTOR shall provide the COMPANY with a list of twenty-four
(24) hour contact details such that KEY PERSONNEL can always be contacted to
discuss forthcoming and ongoing operations.     3.0 EQUIPMENT     3.1 The
CONTRACTOR shall ensure that all equipment sent to the WORKSITE shall comply
with the applicable specifications, procedures and regulations applicable to the
WORKSITE.     3.2 CONTRACTOR shall ensure that all equipment is provided with
all necessary certification, data sheets, packaging and slings, where required.
    4.0 SUBCONTRACTORS     4.1 The CONTRACTOR shall clearly identify areas of
potential SUBCONTRACT involvement within the workscope and advise the COMPANY of
proposed or potential SUBCONTRACTOR(S).     5.0 INTERFACING     5.1 Should the
CONTRACTOR be required to interface and undertake co-ordination activities with
other contractors as relevant to the WORK, the CONTRACTOR shall agree with the
COMPANY REPRESENTATIVE, the frequency and format of any meetings and
co-ordination matters necessary between the CONTRACTOR and other parties.

 

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CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

B SCOPE OF WORK     1.0 GENERAL

 

CONTRACTOR shall provide for use by COMPANY one PB3 PowerBuoy Intelligent
Monitoring Buoy (PB3), and associated sensor / alert equipment and support
monitoring services as directed by COMPANY REPRESENTATIVE. The technical
specification for the PB3 is set forth in Exhibit 1 to this CONTRACT.

 

The WORK shall be performed fully in accordance with the provisions of the
CONTRACT, as authorised by the relevant PURCHASE ORDER(s). CONTRACTOR shall,
upon receipt of PURCHASE ORDER, carry out the WORK as required and as described
in the aforesaid PURCHASE ORDER. As set forth in Exhibit 2, commencement of the
Trial Period shall occur once the PB3 is delivered to COMPANY in Aberdeen and
deemed fit for purpose as set forth in Exhibit I.

 

2.0 DESCRIPTION OF THE WORK     2.1 Summary Description     2.1.1 The WORK shall
include the project management, engineering, design, supply, procurement,
expediting, manufacturing, fabrication, inspection, acceptance testing,
packaging and support during well intervention and abandonment programmes.    
2.1.2 The WORK shall also include the provision of labour, supervision, QA/QC,
equipment, consumables, materials, procurement, services and other resources
necessary for, or incidental to, the complete performance of the WORK.     2.1.3
CONTRACTOR shall provide equipment and tools as agreed and specified in Exhibit
1. All equipment supplied shall be deemed to include the supply of all back-ups,
consumables, spares and ancillary equipment necessary for the WORK.     2.1.4
COMPANY shall maintain and operate its equipment in accordance with CONTRACTOR’s
recommendations and in a safe and operationally efficient manner in accordance
with the requirements and instructions issued from time to time by CONTRACTOR.  
  2.2 Rental Tools and Associated Equipment (NOT USED – SEE SECTION III.7 ABOVE)
    2.3 Personnel     2.3.1 The CONTRACTOR will, in accordance with the
provisions of this CONTRACT as authorised by any relevant PURCHASE ORDER,
provide the necessary number of competent and skilled personnel to manage and
undertake the WORK, in accordance with good UKCS oil & gas field practice, all
legislative requirements and the CONTRACT.     2.3.2 The CONTRACTOR shall
provide all necessary management, administrative and technical support
personnel, at the CONTRACTOR’s base, to fully support the WORK.     2.3.3 The
CONTRACTOR GROUP’s personnel will be capable of troubleshooting and correcting
equipment/tool problems and failures. In the event that any member of the
CONTRACTOR GROUP’s personnel is unable to perform their duties adequately, or
fails to have proper equipment available, the CONTRACTOR shall replace such
personnel, or remedy the situation to the COMPANY’s satisfaction, at the sole
expense of the CONTRACTOR within forty-eight (48) hours.

 

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CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

2.3.4 Due to the nature of its activities, the COMPANY expects the maximum
flexibility in the CONTRACTOR’s provision of the WORK. The CONTRACTOR GROUP’s
personnel shall be required to be flexible in working hours, working
relationships and location.     2.3.5 CONTRACTOR shall guarantee performance of
the WORK on a 24 hour, 365 day basis.     2.3.6 CONTRACTOR maybe requested to
provide dedicated personnel for the provision of the WORK. Reimbursement shall
be charged at the rates contained within Section III – Reimbursement.     2.3.7
All of the COMPANY’s operations will be conducted in English and the CONTRACTOR
must ensure all of the CONTRACTOR GROUP’s personnel are fluent in spoken and
written English. The COMPANY reserves the right to reject any such personnel
whose English is not of a sufficient standard.     2.3.8 CONTRACTOR shall supply
personnel to undertake both onshore and offshore Services. CONTRACTOR shall be
responsible for ensuring that its personnel are fully equipped, at CONTRACTOR’s
cost, with suitable protective clothing.     2.3.9 All personnel changes
proposed by the CONTRACTOR must be discussed between the Parties and shall only
be completed with the prior written approval of the COMPANY. Replacement
personnel shall be of an acceptable standard with similar experience to that
detailed in the original personnel’s CV.     2.3.10 The CONTRACTOR shall provide
the COMPANY with a list of twenty-four (24) hour contact details such that KEY
PERSONNEL can always be contacted to discuss forthcoming and ongoing operations.
    2.4 Equipment     2.4.1 The CONTRACTOR shall ensure that all equipment sent
to the WORKSITE shall comply with the applicable specifications, procedures and
regulations applicable to the WORKSITE.     2.4.2 CONTRACTOR shall ensure that
all equipment is provided with all necessary certification, data sheets,
packaging and slings.     2.5 Subcontractors     2.5.1 CONTRACTOR shall clearly
identify areas of potential SUBCONTRACT involvement within the WORK and advise
the COMPANY of proposed or potential SUBCONTRACTOR(S).     3.0 INTERFACING    
3.1 Should the CONTRACTOR be required to interface and undertake co-ordination
activities with other Contractors as relevant to the WORK, the CONTRACTOR shall
agree with the COMPANY REPRESENTATIVE, the frequency and format of any meetings
and co-ordination matters necessary between the CONTRACTOR and other parties.  
  4.0 COMPANY AND CONTRACTOR INTERACTION     4.1 The COMPANY will monitor the
CONTRACTOR’s activities relative to quality, value of WORK completed and
schedule requirements and in compliance with the CONTRACT. This will be carried
out by utilising the COMPANY personnel who will be responsible for the
safeguarding of the COMPANY’s interests.

 

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CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

  (a) Monitor the WORK of the CONTRACTOR GROUP;   (b) Review selected
engineering documentation, requisitions, calculations, manuals, etc., issued for
review at various stages of the design;   (c) Review VARIATION Proposals
submitted by the CONTRACTOR for approval; and   (d) Establish regular meetings
with the CONTRACTOR to discuss and evaluate progress of the WORK and other items
relevant to the CONTRACT.       4.2 Regular meetings shall be held between the
COMPANY and the CONTRACTOR as agreed with CONTRACTOR REPRESENTATIVE and COMPANY
REPRESENTATIVE.     4.3 When meetings are confirmed, the agreed agenda shall be
issued to all parties concerned.           Both the COMPANY and the CONTRACTOR
shall ensure, in accordance with their respective responsibilities that reports,
documentation and forward planning information relating to agenda items are
issued in sufficient time to allow adequate preparatory study and evaluation, as
agreed between the COMPANY and the CONTRACTOR.     4.4 CONTRACTOR shall be
responsible for preparing minutes of every meeting whenever any meeting is held.
The CONTRACT title, meeting location, date, time and a list of those present
must be included at the head of the minutes.       All actions defined at the
meeting must be numbered and those responsible for undertaking the action
highlighted and submitted to COMPANY REPRESENTATIVE within forty-eight (48)
hours of completion of the meeting.     5.0 DOCUMENTATION MANAGEMENT     5.1
CONTRACTOR shall ensure that all necessary and contemporary legal records are
maintained and are available for inspection at all times.     5.2 Documentation
including vendor instruction manual, technical bulletins and other amendments
issued by vendors, inspection reports, certification and technical reports,
shall be provided by the CONTRACTOR in hard copy and uploaded into COMPANY’s
electronic database by the CONTRACTOR. CONTRACTOR shall collate the foregoing
documentation for all existing equipment and update the documentation for all
new equipment.     6.0 PLANS, PROGRAMME & SCHEDULE     6.1 The CONTRACTOR shall
commence performance of the WORK in accordance with the schedule set forth in
Exhibit 2 and shall proceed with the same with all due diligence, so as to
achieve the completion of the WORK on or before the specified completion date.  
  6.2 The CONTRACTOR shall at all times afford the WORK the highest priority and
shall not assign to any other work a priority which affect or interferes with
the due and timely performance of the WORK in accordance with the agreed
programme.     6.3 Where applicable to the WORK, the CONTRACTOR shall develop a
Risk Identification Analysis which identifies typical risks associated with its
WORK, covering: project management, procurement and associated QA/QC phases
along with technical and Health Safety and Environmental issues.

 

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CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

6.4 If at any time during the course of its performance of the WORK, the
CONTRACTOR for any reason believes that the WORK or any part thereof cannot be
completed in accordance with the programme, the CONTRACTOR shall promptly notify
the COMPANY in writing of such possible delay and specify the following:        
(a) Cause of the delay;   (b) Effect on the agreed programme; and   (c) Remedial
action considered appropriate       6.5 If in the opinion of the COMPANY, the
CONTRACTOR’s progress is inadequate or the CONTRACTOR fails to comply with the
agreed programme then the COMPANY shall notify the CONTRACTOR of such inadequacy
in writing and the CONTRACTOR shall, at no additional expense to the COMPANY,
immediately take such action as the COMPANY considers necessary to comply with
the requirements of the agreed programme.     6.6 CONTRACTOR shall provide the
necessary resources and services to effectively manage all aspects of the WORK
associated with the CONTRACT. The WORK shall be completed in accordance with
CONTRACTOR’s established quality assurance procedures and systems.     6.7
CONTRACTOR shall ensure that all aspects of the WORK are in compliance with UK
statutory requirements and current health and safety legislation and shall
ensure that all equipment provided (whether purchased or rented) is of sound
quality and complies with recognised industry standards and codes.     6.8
CONTRACTOR shall endorse COMPANY supplied documents to the effect that they are
sufficient and adequate in content and correctness for the CONTRACTOR to carry
out the WORK in accordance with terms and conditions of the CONTRACT and agreed
delivery schedule. CONTRACTOR shall report to COMPANY any discrepancies in such
technical documents discovered during its review of same in accordance with the
CONTRACT. Conflicts between specifications, codes, standards and drawings shall
be resolved by COMPANY whose decision shall be final and binding on both
parties.     6.9 The CONTRACTOR shall provide, maintain and be responsible for
the management and control of all resources and SUBCONTRACTORs which are
involved in all aspects of the WORK. The CONTRACTOR shall co-ordinate and
interface with COMPANY in the performance of the WORK. COMPANY shall have
reasonable access to any place where the WORK is undertaken, and shall have open
and unrestricted communication with any of CONTRACTOR’s personnel.     6.10
CONTRACTOR shall ensure that the proposed management structure demonstrates a
full commitment to maintaining and administering the quality and safety of the
WORK. As a minimum, the CONTRACTOR shall be responsible for the following:      
  ● Putting in place all insurances required in the name of the CONTRACTOR;   ●
Planning and progress control;   ● Cost and invoicing control;   ● Design and
interface engineering;   ● Change control;   ● Procurement of CONTRACTOR
materials and equipment;   ● Award and administration of SUBCONTRACTS;   ●
Material Control;   ● HSEQ management;   ● Reporting.

 

Page | 27

 

 

CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

7.0 MANAGEMENT     7.1 It is the intent of the CONTRACT that the WORK will be
executed to the mutual satisfaction of both parties, at the highest level of
safety and execution performance for the lowest possible cost and in a timely
manner, commensurate with excellence in quality standards. CONTRACTOR’s overall
management of the services shall be proactive in seeking innovative, efficient
working methods and approaches to problems and issues that arise.     7.2
CONTRACTOR will provide sufficient management resource such that the programmes
of work are organised, planned and effectively co-ordinated with all other site
activities to ensure efficient implementation.     7.3 CONTRACTOR shall be
required to maintain an environment that supports quantifiable and measurable
continuous performance improvement. CONTRACTOR shall provide adequate management
support to achieve the objectives with the CONTRACTOR’s REPRESENTATIVE, being
given overall responsibility, authority and accountability within the
CONTRACTOR’s organisation for the success of the CONTRACT and for the interface
with the COMPANY REPRESENTATIVE.     8.0 CALL-OFF SERVICES (NOT USED)

 

Page | 28

 

 

CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

SECTION V

 

ADMINISTRATION INSTRUCTIONS

 

Page | 29

 

 

CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

SECTION V - ADMINISTRATION INSTRUCTIONS

 

1.0 Introduction

 

This Section sets out certain WORK related ‘General Administration’ which shall
be adopted by the CONTRACTOR in the performance of the WORK under this CONTRACT.

 

All communications between the Parties shall include a reference to the CONTRACT
number, and/or associated PURCHASE ORDER.

 

2.0 Invoice Management / Instructions

 

All invoices submitted by the CONTRACTOR must be on a strict monthly basis, and
in a structured manner, which can be easily monitored against forecast
expenditure. In instances where the CONTRACTOR is supplying materials and/or
services to one or more of the WORKSITES separate invoices should be submitted
for each location.

 

The CONTRACTOR shall submit 1 (one) original sales invoice to the following
address and contact person for payment:

 

By email to:              aberdeen-accounts@premier-oil.com

 

(Please note all invoices should be single attachments and the total size of the
email, including the attachments, should be no greater than 12mb or the email
maybe rejected due to size)

 

All invoices must contain the following information :-

 

  ● Contract Number – POUK C2394         ● Platform (Location / Asset) – e.g.
Huntington or as detailed within the PURCHASE ORDER – will always be uniquely
numbered         ● Cost centres / Account codes: Shall be detailed in the
relevant PURCHASE ORDER

 

Failure to incorporate this information on the invoice may lead to the invoice
being returned to CONTRACTOR

 

CONTRACTOR shall ensure that all necessary back up is attached to invoices to
enable ease of checking. In particular, good quality copies of the following
shall be attached (as applicable):

 

  ● Cargo Summary Ticket(s);         ● CONTRACTOR Outbound Manifest(s), Receipt
and Delivery Ticket(s);         ● CONTRACTOR Inward Manifest(s), Consignment
Note(s);         ● Authorised Timesheets by COMPANY REPRESENTATIVE or designated
COMPANY personnel; and         ● Work Instruction(s).

 

CONTRACTOR may only invoice for completed WORK following receipt and retention
of duly executed original PURCHASE ORDER

 

Page | 30

 

 

CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

3.0 Purchase Order Mechanism     3.1 COMPANY shall issue a unique PURCHASE ORDER
number for each individual WORK requirement to be undertaken by the CONTRACTOR
under the CONTRACT. Prior to the PURCHASE ORDER being issued the following
procedure shall be complied with by the parties:         (a) COMPANY shall
submit to the CONTRACTOR a written scope of requirements.   (b) CONTRACTOR
shall, on receipt of the written scope of requirements submit to the COMPANY
electronically, a uniquely referenced quotation submission detailing the method,
resources and price for completing the WORK, in accordance with Section III,
Remuneration. In the event that revisions are required to the original or to any
subsequent quotations issued by the CONTRACTOR, the CONTRACTOR shall give each
revision a unique reference.   (c) On the receipt of the final version of the
quotation from the CONTRACTOR, COMPANY shall issue a PURCHASE ORDER to the
CONTRACTOR containing CONTRACTOR’s unique reference for the WORK and the
PURCHASE ORDER number. This is the PURCHASE ORDER upon which the CONTRACTOR
shall commence the WORK (refer to the sample format provided in Attachment 1).
The PURCHASE ORDER shall also contain the information detailed in Clause 2.0
above.       3.2 Notwithstanding 3.1 above, in the event that the COMPANY
requests by way of a telephone call to the CONTRACTOR that the CONTRACTOR
undertakes WORK under the CONTRACT, the CONTRACTOR shall, as soon as practicable
thereafter, send a written electronic notification to the COMPANY specifying the
CONTRACT and PURCHASE ORDER Number, the WORK to be performed, the schedule and
cost. This form of commitment mechanism shall constitute a PURCHASE ORDER.    
3.3 Written acknowledgment of the PURCHASE ORDER by the CONTRACTOR or
commencement by the CONTRACTOR of any part of the WORK described therein shall
be deemed to be acceptance of the PURCHASE ORDER and the terms and conditions of
this CONTRACT.     3.4 In the event of any member of the CONTRACTOR GROUP and/or
any equipment owned, hired, leased or otherwise belonging to any member of the
CONTRACTOR GROUP being mobilised to a COMPANY OFFSHORE FACILITY to undertake
WORK on behalf of the COMPANY in circumstances where no PURCHASE ORDER has been
entered into by the parties, but the provisions of 3.2 above have been applied,
then the terms and conditions of this CONTRACT shall apply in their entirety to
such a mobilisation and/or WORK.     3.5 COMPANY has no obligation towards
CONTRACTOR in connection with the CONTRACT until such time as a PURCHASE ORDER
is issued. COMPANY gives no guarantee of any WORK being generated as a result of
a CONTRACT being entered into between COMPANY and CONTRACTOR.     4.0
Interfacing (Not Used)

 

Should the CONTRACTOR be required to interface and undertake co-ordination
activities with other contractors as relevant to the WORK as detailed in Section
IV – Scope of WORK, the CONTRACTOR shall agree with COMPANY REPRESENTATIVE, the
frequency and format of any meetings and co-ordination matters necessary between
the CONTRACTOR and other parties.

 

Page | 31

 

 

CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

Recognise and insert where applicable Key Personnel

 

CONTRACTOR’s Key Personnel are identified as follows: -

 

Name   Discipline Chris Phebus   Vice President, Engineering Chris Bukosky  
Senior Director, Operations Hizykas Dufera   Program Manager

 

Support personnel of CONTRACTOR will be provided on an as required basis

 

CONTRACTOR shall not change out Key Personnel without the prior agreement of
COMPANY.

 

5.0 Materials / Services Control

 

All materials and equipment procured for this CONTRACT shall be rigorously
controlled and reported by the CONTRACTOR to the COMPANY.

 

6.0 Reporting

 

Reporting requirements, specific formats and frequencies will be stipulated and
agreed with the COMPANY REPRESENTATIVE and incorporated in Section IV – Scope of
Work.

 

7.0 Company Change Control / Variation Procedures

 

The COMPANY and the CONTRACTOR shall operate a Change Control / Variation Notice
Procedure whereby changes to the WORK should be formally submitted by the
CONTRACTOR, reviewed and approved by the COMPANY prior to any such change to the
WORK being implemented. The impact on the overall cost to the COMPANY should be
determined and projected.

 

Each request for a Change / Variation Order Request (VOR) to the relevant
PURCHASE ORDER should be submitted to the COMPANY containing the following
details:-

 

Potential Variation Order – Supporting Documentation

 

  ● Description         ● Justification         ● Unit Cost & Schedule Impact  
      ● Schedule

 

Page | 32

 

 

CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

SECTION V

ATTACHMENT 1

PURCHASE ORDER EXAMPLE

1.0 GENERAL

 

COMPANY will raise a PURCHASE ORDER for WORK provided under this Scope of Work,
and CONTRACTOR shall perform the Work as described in the relevant Purchase
Order. Each PURCHASE ORDER shall reference the CONTRACT and be allocated a
specific PURCHASE ORDER number. The PURCHASE ORDER number shall be quoted on all
correspondence regarding each individual PURCHASE ORDER. Consistent with the
CONTRACT, the PURCHASE ORDER shall describe requirements for CONTRACTOR’S
personnel, rental equipment together with the applicable rates and/or prices,
scope of work and any other relevant details.

 

Prior to the issue of a PURCHASE ORDER, CONTRACTOR shall liaise with COMPANY to
provide estimated costs for the services. Consistent with the CONTRACT, the
COMPANY has the right to issue instructions to the CONTRACTOR at any time to
make any variations to the PURCHASE ORDER, or issue a new PURCHASE ORDER, which
are within the capability and resources of the CONTRACTOR.

 

COMPANY has no obligation towards CONTRACTOR in connection with the CONTRACT
until such time as a PURCHASE ORDER is issued. COMPANY gives no guarantee of any
Work being generated as a result of a CONTRACT being entered into between
COMPANY and CONTRACTOR. A signed PURCHASE ORDER however is binding on both
parties.

 

COMPANY’S pro-forma PURCHASE ORDER is as shown herein.

 

Approved by COMPANY.............Approved by CONTRACTOR.............

 

 

CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

[image_002.jpg]

 

Approved by COMPANY.............Approved by CONTRACTOR.............

 

 

CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

[image_003.jpg]

 

Approved by COMPANY.............Approved by CONTRACTOR.............

 

 

CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

SECTION VI

 

HEALTH, SAFETY, SECURITY, ENVIRONMENTAL PROTECTION

and QUALITY MANAGEMENT

 

Approved by COMPANY.............Approved by CONTRACTOR.............

 

 

CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

HEALTH SAFETY AND ENVIRONMENTAL

 

[image_004.jpg]

 

Approved by COMPANY.............Approved by CONTRACTOR.............

 

 

CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

SECTION VI - HEALTH SAFETY AND ENVIRONMENTAL

 

1.0 Safe and Environmentally Responsible Performance of THE WORK

 

1.1 The CONTRACTOR shall and shall procure that the CONTRACTOR GROUP shall
perform the WORK in a manner that minimises the risks to the environment, and
the health and safety of the CONTRACTOR GROUP’s personnel and all others who may
be affected by the CONTRACTOR GROUP’s acts and/or omissions.     1.2 Prior to
commencement of the WORK, the CONTRACTOR shall provide the COMPANY with a
statement on the Health, Safety and Environmental (HSE) policy of the
CONTRACTOR. The CONTRACTOR shall notify the COMPANY of any revision or amendment
issued to the CONTRACTOR’s HSE policy which is made during the term of the
CONTRACT. The CONTRACTOR shall also have established arrangements for monitoring
this policy.     1.3 The CONTRACTOR shall incorporate HSE safety expectations
into the business planning process and shall maintain an organisation capable of
delivering the required safety performance, the organisation shall define:

 

  ● Roles, responsibilities, relationships and reporting lines;   ● Field
personnel with designated responsibilities;   ● Support available from the
corporate organisation;   ● A system of enabling all personnel to participate in
safety matters; and   ● Arrangements for the communication of policy.

 

1.4 The CONTRACTOR must have in place and be actively using a formal HSE
Management System which demonstrates commitment to continuous improvement and
excellence in HSE issues. The internationally recognised OHSAS 18001, and ISO
14001 Standards shall be used as guidance for what constitutes an effective
process for overall HSE management.     1.5 The CONTRACTOR’s HSE Management
System shall be adequately documented, shall be shown to be effective in
implementing the aims and objectives of the CONTRACTOR’s HSE policy and shall
include the method and provisions for auditing the effectiveness of the
CONTRACTOR’s HSE Management System as applied to the WORK.     1.6 The
CONTRACTOR and its SUBCONTRACTORS shall review their HSE Management System at
least annually and update it as necessary.     1.7 The CONTRACTOR’s HSE
Management System shall, where relevant interfaces exist, be compatible with the
COMPANY’s HSE Management System. The CONTRACTOR shall liaise with the COMPANY
REPRESENTATIVE to ensure that the roles and responsibilities in both systems are
clearly defined and allocated and are clearly understood by all parties involved
in the WORK.     1.8 Within the framework of its HSE Management System, the
CONTRACTOR shall perform the WORK to HSE performance standards which are
compatible with those in the COMPANY’s HSE Management System.     1.9 Where
appropriate, the interfaces between the CONTRACTOR and the COMPANY shall be
documented in the form of an HSE Management System (“HSEMS”) Interface Document
which shall be deemed to be part of the CONTRACT which must be delivered within
thirty (30) days of the date of execution of the CONTRACT.

 

Approved by COMPANY.............Approved by CONTRACTOR.............

 

 

CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

The CONTRACTOR shall, if required in relation to the WORK, also deliver to the
COMPANY an adequate written safety plan (HSE Plan). CONTRACTOR shall ensure that
the HSEMS Interface Document and HSE Plan is implemented and maintained
throughout the duration of the CONTRACT. CONTRACTOR shall review the HSEMS
Interface Document and HSE Plan at appropriate intervals, on the written request
of the COMPANY or, as a minimum, on an annual basis every twenty-four (24)
months and revise the same as necessary.

 

The HSEMS Interface Document shall incorporate any specific requirements
relevant to the WORK and take account of ‘Step Change’ and Oil & Gas UK
Guidelines on Safety Management System interfacing. CONTRACTOR shall be
responsible for ensuring that interface arrangements are communicated to the
CONTRACTOR GROUP’s workforce and for monitoring the implementation of such
arrangements.

 

1.10 The CONTRACTOR shall be responsible for ensuring that the CONTRACTOR GROUP
and their respective personnel understand and operate in accordance with the
principles and requirements of the HSE provisions and that similar standards
apply to their HS&E management systems and HS&E performance.     1.11 If
requested by the COMPANY, the CONTRACTOR shall, as a minimum, prepare, on an
annual basis, a plan for the management of all aspects of the WORK, known as the
“HSE Plan”. The HSE Plan shall address the requirements of these HSE provisions,
including the requirements of the HSE Management System and the Safety
Management System (SMS) Interface Document (where appropriate).

 

CONTRACTOR shall make certain, and shall procure that the CONTRACTOR GROUP
ensures, that all necessary SMS Interface Documentation is in place in relation
to any and all WORK undertaken.

 

The HSE Plan shall be submitted to the COMPANY REPRESENTATIVE for review and
endorsement within a timeframe as agreed with the COMPANY REPRESENTATIVE.

 

1.12 The CONTRACTOR shall develop and agree with the COMPANY REPRESENTATIVE,
performance measures to give visibility that the HSE Plan is being implemented.
    1.13 The HSE Plan shall form part of the CONTRACT. It shall be reviewed at
least annually and updated as necessary to incorporate any changes to the WORK
and/or the CONTRACT.     1.14 The HSE Plan shall address identification of HSE
risks associated with the WORK and definition of methods of controlling those
risks to an acceptable level.

 

Approved by COMPANY.............Approved by CONTRACTOR.............

 

 

CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

2.0 Compliance     2.1 The CONTRACTOR shall and shall procure that the
CONTRACTOR GROUP shall observe and comply with all relevant and current
statutory requirements, approved codes of practice and industry guidance on HSE
matters as well as ensure that compliance is maintained in relation to both
COMPANY and CONTRACTOR’s HSE Management System and expectations.     2.2 The
CONTRACTOR shall ensure that all personnel provided by the CONTRACTOR GROUP
comply with all relevant HSE legislation and guidance and that they are:

 

  (a) fully conversant with the working conditions at the WORKSITE, the hazards
and risks associated with the WORK and the roles and standards relating to the
environment including the handling of waste and hazardous materials;         (b)
fully aware that they are expected to bring to the immediate notice of their
supervisor all health, safety and environmental risks which they believe not to
be under adequate control, so that action may be taken to eliminate or minimize
environmental impacts, prevent potential injuries or other losses, and provide a
safe and healthy WORKSITE;         (c) familiar with all other safety and
working instructions applicable at the WORKSITE and in particular the COMPANY’s
work control system; and         (d) available at all times for periodic drills,
instructions on survival, lifesaving, firefighting, and spill response as
requested and conducted by the COMPANY and shall, prior to or on the day of
arrival offshore, attend an HSE induction course conducted by the COMPANY.

 

2.3 The CONTRACTOR shall and shall procure that the CONTRACTOR GROUP shall
observe and comply with all relevant and current COMPANY standards and
expectations on HSE matters.     2.4 If, in the opinion of the COMPANY
REPRESENTATIVE, the CONTRACTOR and/or a member of the CONTRACTOR GROUP is
working in a manner which contravenes any requirement of these HSE provisions,
the COMPANY shall serve notice on the CONTRACTOR to this effect and the
CONTRACTOR shall immediately take action to rectify the situation.     2.5
Notwithstanding CONTRACTOR’s general responsibility for the safe and
environmentally responsible conduct of its operations, where COMPANY has
notified CONTRACTOR of any specific HSE requirements relating to the CONTRACT,
CONTRACTOR shall ensure compliance with such requirements.     2.6 In the event
of conflict between the HSE standards of COMPANY and CONTRACTOR, such conflict
shall be notified by CONTRACTOR as soon as possible and a resolution sought that
does not compromise the safety of COMPANY operations.     2.7 All chemicals,
issued under permits, shall be fully approved by the Department of Energy and
Climate Change (DECC) and shall be fully documented on current Centre for
Environment, Fisheries and Aquaculture Science (CEFAS) lists.     2.8 In
accordance with the Offshore Chemical Regulations 2002, CONTRACTOR shall and
shall procure that the CONTRACTOR GROUP shall make all reasonable efforts to
replace products with “Substitution Warnings” and products which generate a high
Risk Quotient (RQ) on charm modelling with new products showing better
environmental performance.

 

Approved by COMPANY.............Approved by CONTRACTOR.............

 

 

CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

2.9 The CONTRACTOR shall and shall procure that the CONTRACTOR GROUP shall
provide advice and assistance in the preparation of Drilling Operators Chemical
and / or Oil Discharge Permit applications including estimated chemical usage
and discharge, and current templates to CEFAS.     2.10 The CONTRACTOR shall and
shall procure that the CONTRACTOR GROUP shall maintain complete DECC / Oil & Gas
UK environmental emissions monitoring records for submission.     2.11 The
CONTRACTOR shall provide multiple copies of a comprehensive manual of all the
relevant safety and environmental data for all chemicals and products which
shall be shipped to, and used on any WORKSITE. Copies of this manual shall be
distributed to the COMPANY.     2.12 Where the COMPANY has a Prevention of
Pollution Act (POPA) Exemption in place for the limited discharge of oil to the
environment (e.g. well clean up), the CONTRACTOR shall assist by sampling and
testing offshore and onshore to meet the schedule of requirements as laid out in
the POPA Exemption.     2.13 The CONTRACTOR shall and shall procure that the
CONTRACTOR GROUP shall comply with any future regulatory changes that may be
introduced during the CONTRACT period.     3.0 HSE AWARENESS     3.1 CONTRACTOR
shall and shall procure that the CONTRACTOR GROUP shall ensure that its and
their personnel understand HSE arrangements pertaining to the CONTRACT, and are
aware of any specific risks associated with the WORK and how such risks are to
be managed.

 

Risk Management

 

3.2 Without prejudice to the foregoing generalities, the CONTRACTOR GROUP’s HSE
Management System shall:-

 

  (a) require an assessment of all identifiable HSE hazards and risks associated
with the WORK to be submitted to the COMPANY and shall indicate the proposed
method of controlling those risks to an acceptable level;         (b) include
measurable and realistic targets for HSE performance, covering, but not
necessarily limited to:

 

  ● the frequency of injuries;   ● the frequency of chemical and oil spills;   ●
the number of statutorily reportable events; and   ● predetermined targets for
environmental emissions and waste production   ● as appropriate to the WORK;

 

  (c) include a follow-up system to ensure that all remedial actions identified
by reviews and investigations are closed out, including accidents, incidents and
HSE audits;         (d) incorporate measures which demonstrate that all
personnel provided by the CONTRACTOR GROUP are physically/medically fit at all
times to perform their tasks;

 

Approved by COMPANY.............Approved by CONTRACTOR.............

 

 

CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

  (e) incorporate measures which demonstrate that, in the performance of the
WORK, personnel provided by the CONTRACTOR GROUP are not under the influence of
drugs or alcohol (see Item 5, herein); and         (f) demonstrate that the
system for the pre-qualification and selection of SUBCONTRACTORS ensures the
compatibility and effectiveness of the SUBCONTRACTOR’s own HSE Management
Systems.

 

3.3 Certain activities pose a higher risk to the safety of personnel, property
and the environment. Higher risk activities will accordingly demand a higher
level of HSE management from the CONTRACTOR. Where the use of a SUBCONTRACTOR
involves the importation of higher risk activity, the CONTRACTOR shall ensure
and demonstrate the appropriate level of HSE management.     3.4 In order to
adequately minimise and manage HSE Risk the CONTRACTOR shall and shall procure
that the CONTRACTOR GROUP shall have in place and be actively using a formal HSE
management system which demonstrates commitment to continuous improvement and
excellence in HSE issues.

 

Risk can vary from one WORKSITE to another and, where the WORK is being provided
at more than one WORKSITE, the CONTRACTOR may be required to provide different
levels of HSE management at each WORKSITE.

 

Environmental Risk Management

 

3.5 The CONTRACTOR shall and shall procure that the CONTRACTOR GROUP shall
co-operate with COMPANY in managing the environmental effects arising from
operations.     3.6 The CONTRACTOR shall ensure that in the performance of the
WORK, action is taken to eliminate or minimise adverse environmental effects
associating with the CONTRACTOR GROUP’s activities.     3.7 The CONTRACTOR GROUP
shall act to prevent the uncontrolled and unpermitted release of pollutants in
the execution of the WORK.     3.8 The CONTRACTOR shall and shall procure that
the CONTRACTOR GROUP shall ensure that waste arising from, or associated with
its activities, is properly managed by observing COMPANY and site-specific Waste
Management arrangements.     3.9 The CONTRACTOR shall and shall procure that the
CONTRACTOR GROUP shall ensure that all routine and non-routine emissions and
discharges are reported to the COMPANY.     3.10 The CONTRACTOR is required to
operate within the principles of an internationally recognised standard for an
environmental management system (e.g. ISO 14001).     3.11 The CONTRACTOR shall
be required to implement an Environmental Management System (EMS) which may form
part of an integrated and/or combined HSE Management System.     3.12 The
CONTRACTOR shall ensure that the following environmental objectives for the WORK
are achieved:

 

  ● all WORK shall comply with all applicable government regulations, statutes
and permitting requirements;   ● the WORK is performed in a manner consistent
and compatible with COMPANY policies and business objectives;

 

Approved by COMPANY.............Approved by CONTRACTOR.............

 

 

CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

  ● all marine vessels comply with the relevant annexes of International
Convention for the Prevention of Pollution from Ships (MARPOL) and any
additional requirements of the local Port Authorities where docking/unloading
takes place; and   ● wastes are eliminated where possible, minimised at source,
and reuse maximised. Disposal is controlled in accordance with duty of care
principles and records maintained for legal and audit purposes.

 

3.13 The CONTRACTOR shall consider its significant environmental aspects in the
design, development or change of its products and services and provide on
request information about potential significant environmental impacts during the
delivery of the goods or services and during use and end of life treatment of
the product, as appropriate. The CONTRACTOR shall make best endeavours, where
practicable, to reduce the environmental impact over the whole lifecycle of its
products.

 

Applicable Operational Conditions

 

  ● Environmental Issues and Pollution

 

  » Prior to commencement of the WORK, CONTRACTOR shall provide documentary
evidence that:

 

  ● all recycling, re-use and disposal routes for the products of the process
are acceptable to the relevant local authority and the Scottish Environmental
Protection Agency (SEPA);         ● all carriers are licensed waste carriers,
registered in accordance with the appropriate legislation and that the
appropriate documentation accompanies the consignment at all times;         ●
the contaminated drill cuttings are fully characterised prior to and after
treatment; and         ● appropriate waste documentation is retained by the
CONTRACTOR for the statutory period.

 

  » On an ongoing basis during the provision of the WORK, as evidenced by
sampling, CONTRACTOR shall provide documentary evidence that all residue from
the process destined for landfill disposal conforms with the relevant local
authority and SEPA requirements. CONTRACTOR acknowledges that COMPANY’s
environmental policy stipulates a preference for products of any cuttings
treatment process to be recovered and re-used (as opposed to landfill disposal).
        » From the time that the unprocessed cuttings have been consigned to
CONTRACTOR, CONTRACTOR shall:

 

  ● own and shall be responsible for the safe and secure handling, transport,
processing and storage of waste;         ● be responsible for safe and secure
handling, transport, processing and storage of recovered oil; and         ● be
responsible for the clean-up of any spills, emissions or pollution arising
therefrom in accordance with the CONTRACT.

 

  » For the avoidance of doubt, CONTRACTOR shall not own recovered oil unless
CONTRACTOR and COMPANY agree otherwise in writing.

 

Approved by COMPANY.............Approved by CONTRACTOR.............

 

 

CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

  ● Recovered Products

 

  » CONTRACTOR shall be responsible for recycling, re-use or disposing of the
recovered products from the cuttings treatment process (oil, water and solids).
        » COMPANY may at its sole option elect to retain the recovered oil at no
cost to COMPANY. In this event CONTRACTOR shall store the recovered oil until
COMPANY requests that it be returned to COMPANY. Any transportation required for
returning the recovered oil to COMPANY shall be for COMPANY’s account.         »
Should COMPANY not exercise this option, the CONTRACTOR may, with COMPANY’s
approval seek to sell it to an appropriate third party, or dispose of it as
waste oil.         » Prior to the commencement of the WORK, CONTRACTOR shall
submit a detailed disposal plan for all recovered products (oil, water and
solids) to COMPANY for approval. COMPANY reserves the right to reject this plan
in whole or in part, in which case CONTRACTOR shall be requested to propose
alternative recycling, re-use or disposal routes for COMPANY’s approval.        
» Once the disposal plan has been mutually agreed between COMPANY and
CONTRACTOR, under no circumstances shall CONTRACTOR divert from this plan
without COMPANY’s prior approval in writing. All recycling, re-use or disposal
routes shall require to be fully auditable, and COMPANY reserves the right to
audit CONTRACTOR at any time.         » COMPANY shall notify CONTRACTOR of its
intentions regarding the retention of recovered oil in writing.         » Where
COMPANY elects to retain ownership of the recovered oil, it shall be
CONTRACTOR’s responsibility to collect, label and retain representative samples
of oil from each batch of cuttings processed for quality control purposes. On
COMPANY’s request, these samples shall be forwarded to COMPANY’s designated
laboratory as appropriate for testing. In addition the CONTRACTOR will cooperate
fully with the COMPANY to ensure regulatory requirements for removing the
recovered oil from the waste chain and enabling its re-use are met.

 

Health Risk Management

 

3.14 Health Impact Assessment (HIA), Health Risk Assessment (HRA) and Health
Risk Management are essential to ensure that personal, occupational and
environmental health risks are managed properly.

 

The CONTRACTOR shall and shall procure that the CONTRACTOR GROUP shall implement
specific health management measures for all aspects of the WORK. This shall be
defined in the CONTRACTOR HSE Plan and shall include:

 

  ● Clear health standards;   ● Compliance with all applicable laws and
regulations; or standards where laws and regulations do not exist; regarding
safe handling of toxic materials and hazardous chemicals and all other
construction work practices;   ● Identification of health hazards through risk
assessments;   ● Provision for health, sanitations catering and medical
facilities for the personnel at each WORKSITE; and   ● A fitness for work
programme to confirm that personnel are capable of performing WORK without undue
risk to themselves or others.

 

Approved by COMPANY.............Approved by CONTRACTOR.............

 

 

CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

3.15 The COMPANY is committed to providing a safe and healthy working
environment for all personnel, visitors and third parties impacted by its
operations. This includes an environment free from the hazards caused by the
abuse of substances including, without limitation, alcohol. The policy equally
applies in all aspects to both onshore and offshore personnel both of the
COMPANY, CONTRACTOR GROUP, and any other contractors at all WORKSITES.
CONTRACTOR GROUP shall comply with requirements of the policy currently in force
which is referenced in Item 5, herein.

 

Design Risk Management

 

3.16 Excellence in design safety is an engineering responsibility and is best
achieved through design hazard management, which is a process involving major
hazard identification, evaluation and continuous risk reduction through design
safety measures. Design hazard management is underpinned by five engineering
activities:

 

  ● Inherently safer design;   ● Safety critical, and environmentally critical
design measures;   ● Performance standards;   ● Safety study programme
(including Human Factors), and   ● ALARP demonstration.

 

Managing hazards in design involves eliminating or minimising major accident
hazards at the source and preventing those that remain from becoming major
accidents. It also involves the provision of sufficient design integrity to
control the consequences of a major accident to reduce severity and potential
adjustment, while providing mitigation and protection for personnel and key
facilities from the effects (e.g. heat, smoke, gas, toxic fumes etc.).

 

The CONTRACTOR shall and shall procure that the CONTRACTOR GROUP shall apply the
above design safety principles to all design activities related to the WORK and
where appropriate refer to the COMPANY’s “Technical Integrity Performance
Standards” as a guide in the management of technical integrity as relevant to
the WORK.

 

Safety Risk Management

 

3.17 The CONTRACTOR shall, at its own expense, provide its personnel with all
necessary protective clothing and equipment suitable for the working conditions.
For duty offshore, such clothing/equipment shall be in accordance with the
COMPANY standard requirements.     3.18 The CONTRACTOR shall ensure that
CONTRACTOR GROUP’s Personnel are equipped with and make proper use of suitable
personal protective clothing and equipment for the WORK being undertaken and
that such protective clothing and equipment is maintained in good condition at
all times.     3.19 The CONTRACTOR shall ensure that arrangements are in place
for the repair and/or replacement of personal protective equipment.     3.20
When located at a WORKSITE owned, operated or controlled by the COMPANY, all
personnel provided by the CONTRACTOR shall comply with all current and relevant
COMPANY HSE Practices as they relate to the WORK. At other WORKSITES, the
CONTRACTOR and the COMPANY shall agree which HSE Practices are appropriate to
the WORK and this will be addressed in the HSE Interface Document. Where
necessary and appropriate, the CONTRACTOR shall seek advice from the COMPANY on
the interpretation of the COMPANY’s HSE Practices.

 

Approved by COMPANY.............Approved by CONTRACTOR.............

 

 

CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

3.21 The CONTRACTOR shall observe and comply and shall ensure that the
CONTRACTOR GROUP observes, and complies with the COMPANY’s procedures with
regard to the selection, deployment, operation and maintenance of equipment
offshore. For the purposes of this Section V- Health, Safety and Environment,
equipment shall mean, without limitation, all portable or transportable plant,
tools, offices, workshops etc. provided by the CONTRACTOR GROUP.     3.22 The
CONTRACTOR is responsible for ensuring that all equipment is operated in
accordance with safe working practices.     3.23 The location of equipment at an
offshore WORKSITE shall be agreed in advance by the CONTRACTOR with the COMPANY
REPRESENTATIVE.     3.24 The CONTRACTOR shall formally advise the COMPANY
REPRESENTATIVE(S) in writing of any known medical disability or condition of any
personnel provided by the CONTRACTOR and/or a member of the CONTRACTOR GROUP in
connection with the WORK which may adversely affect their own health and safety,
or the health and safety of others.     3.25 The CONTRACTOR shall ensure that
all personnel provided by the CONTRACTOR and/or the CONTRACTOR GROUP shall keep
all WORKSITES as clean and tidy as is reasonably practicable under the
circumstances, to minimise the risk of causing injury to persons, damage to
property or delays in providing the WORK.     3.26 On completion of the WORK,
the CONTRACTOR shall and shall procure that the CONTRACTOR GROUP shall, without
delay, clear away and remove from the WORKSITE all surplus materials and
equipment and leave all areas in a clean and tidy condition to the satisfaction
of the COMPANY REPRESENTATIVE.     4.0 TRAINING AND COMPETENCE     4.1 The
CONTRACTOR shall and shall procure that the CONTRACTOR GROUP ensures that all
personnel are trained and competent to perform the WORK in a safe and efficient
manner. The CONTRACTOR shall ensure that all personnel mobilising to the
WORKSITE are trained as per the COMPANY minimum standards outlined in Section V
– Health, Safety and Environment.     4.2 The CONTRACTOR shall provide all
necessary technical and vocational training to ensure that CONTRACTOR’S
personnel maintain the necessary level of competence for the WORK.     4.3 The
CONTRACTOR shall ensure that all offshore assigned personnel are in possession
of emergency training certification in line with Oil & Gas UK Guidelines.    
4.4 The CONTRACTOR shall ensure that all CONTRACTOR GROUP personnel co-operate
with COMPANY by taking part in any site or job specific training deemed
necessary by COMPANY.     4.5 The CONTRACTOR shall ensure that, prior to
mobilisation to an offshore WORKSITE and / or to a COMPANY OFFSHORE FACILITY as
appropriate, each member of the CONTRACTOR GROUP conforms to the following
training requirements:

 

Approved by COMPANY.............Approved by CONTRACTOR.............

 

 

CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

  (a) has successfully attended sea survival, firefighting and refresher courses
as necessary in accordance with Oil & Gas UK guidelines;         (b) has
successfully completed the Minimum Industry Safety Training (MIST) (Minimum
Industry Safety Training) and holds up-to-date certified evidence thereof in
accordance with the COMPANY’S HSE; and         (c) has completed the mandatory
Integrated Safe Systems of Work (ISSOW) Roles and Responsibilities Training as
well as the appropriate level of ISSOW Training which is commensurate with the
users roles and responsibilities within the system.

 

In addition, the CONTRACTOR shall be obliged to ensure sufficient CONTRACTOR
GROUP supervisory personnel are employed to make sure that all of the CONTRACTOR
GROUP’s personnel engaged upon the WORK fully understand any and all of the
COMPANY’s procedures and policies written in the English language. The
CONTRACTOR shall ensure that there are sufficient CONTRACTOR GROUP supervisory
personnel employed to translate and interpret to non-English speaking/reading
CONTRACTOR GROUP personnel engaged in the work the ISSOW permit to work system
and the COMPANY procedures and policies and how they are to be complied with.

 

5.0 MEDICAL FITNESS     5.1 The CONTRACTOR shall ensure that all CONTRACTOR
GROUP personnel for the performance of the WORK provided are medically fit and
that in particular, all personnel proposed by the CONTRACTOR GROUP for duty on
an offshore WORKSITE and / or COMPANY OFFSHORE FACILITY shall be certified as
medically fit (including dental fitness) for duty offshore in accordance with
the “Recommenced General Medical Standards of Fitness for Designated Offshore
Employees, UKCS” as issued by UKOOA now known as “Oil & Gas UK”.     5.2 The
CONTRACTOR shall and shall procure that the CONTRACTOR GROUP shall ensure that
all personnel engaged in the WORK are aware of, and comply with COMPANY’s
Substance Abuse Policy, and co-operate with COMPANY in the implementation of
that policy.     6.0 MATERIALS, TOOLS AND EQUIPMENT     6.1 The CONTRACTOR shall
and shall procure that the CONTRACTOR GROUP shall ensure that all materials,
tools and equipment provided, whether owned or rented, are fit for their
intended purpose, are appropriately certified, and are stored and maintained
such that risks to users and others and to the environment are minimised.    
6.2 The CONTRACTOR shall and shall procure that the CONTRACTOR GROUP shall
ensure that all materials and equipment for transportation to COMPANY WORKSITES
are properly packaged and labelled, and that all relevant documentation
requirements are met.     6.3 The CONTRACTOR shall where reasonably requested by
the COMPANY ensure that third party inspections are carried out in accordance
with COMPANY procedures. The CONTRACTOR shall and shall procure that that the
CONTRACTOR GROUP shall be familiar with, and shall ensure that, the maintenance
of temporary and portable equipment is inspected in accordance with the
COMPANY’s Maintenance Procedure.     6.4 The CONTRACTOR shall provide evidence
of compliance with a Written Scheme of Verification for any supplied equipment
deemed to be a Safety Critical Element

 

Approved by COMPANY.............Approved by CONTRACTOR.............

 

 

CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

7.0 HSE INCIDENT REPORTING AND INVESTIGATION     7.1 CONTRACTOR shall and shall
procure that the CONTRACTOR GROUP shall ensure that personnel are aware of, and
comply with, COMPANY’s requirement to properly report all incidents including
near-misses.     7.2 The CONTRACTOR shall notify COMPANY both orally and in
writing immediately after discovering, or receiving a report relating to any of
the following events in relation to the WORKSITE:

 

  ● The death of any member of the CONTRACTOR GROUP;   ● The injury of any
member of the CONTRACTOR GROUP;   ● Near Misses;   ● Environmental releases;   ●
Any regulatory reportable incident or any event with adverse
public/authority/NGO/media response;   ● Any significant security event;   ● The
receipt by the CONTRACTOR GROUP of any environmental improvement notice by any
governmental authority;   ● The receipt by the CONTRACTOR GROUP of notice of any
alleged violation of HSE regulations or of any action against the CONTRACTOR
GROUP by any government authority; or   ● Any proceedings being commenced or
threatened, alleging any failure by CONTRACTOR GROUP to comply with HSE
regulations or alleging potential responsibility for the release of hazardous
material.

 

7.3 The CONTRACTOR shall and shall procure that the CONTRACTOR GROUP shall
co-operate with the COMPANY in the investigation of any incidents with which
CONTRACTOR GROUP is deemed to have an association.       Where the event is
related to the WORK, COMPANY shall be invited to participate in both the
investigation and root cause analysis process and be kept informed of progress
relating to close out of incident and associated actions.     7.4 The CONTRACTOR
shall and shall procure that the CONTRACTOR GROUP shall co-operate with the
COMPANY in implementing corrective and preventive measures identified by
incident investigations.     7.5 The CONTRACTOR shall and shall procure that the
CONTRACTOR GROUP shall co-operate with the COMPANY in ensuring that any lessons
learned from incident investigations are properly communicated, and are
incorporated into HSE Management Systems and workplace practice, where
appropriate.     7.6 The CONTRACTOR shall ensure that the COMPANY is advised of
any incidents occurring at CONTRACTOR GROUP’s premises that involve COMPANY
people or equipment or could adversely impact on COMPANY’s business.     8.0
PERFORMANCE MANAGEMENT     8.1 The CONTRACTOR shall on behalf of the CONTRACTOR
GROUP, submit a formal report to the COMPANY REPRESENTATIVE, as and when
requested by COMPANY, which summarises its HSE performance in the preceding
reporting period. This report shall detail, without limitation, the following:

 

Approved by COMPANY.............Approved by CONTRACTOR.............

 

 

CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

  (a) performance against agreed/planned HSE targets;         (b) all Oil & Gas
Producers (OGP) and Reporting of Injuries, Diseases and Dangerous Occurrence
(RIDDOR) reportable injuries;         (c) all other accidents, spills or other
unplanned discharges which either result in, or have potential for, significant
injury/damage/loss or are reportable to a statutory authority;         (d) all
near miss incidents which have potential for injury/damage/loss;         (e) the
issue or proposed issue of an Improvement or Prohibition Notice, notice of
intended prosecution or other legal process;         (f) any other event
reportable to a statutory authority;         (g) a summary of monitoring
activity, reviews, inspections and audits;         (h) a summary of the status
of any remedial actions; and         (i) total worked hours for all personnel
provided by the CONTRACTOR GROUP on the WORK.

 

8.2 The CONTRACTOR shall undertake an appropriate level of monitoring of HSE
performance in the execution of the CONTRACT workscope.     8.3 The CONTRACTOR
shall co-operate with the COMPANY in the formal HSE audit and review of the
CONTRACT Scope of Work.     8.4 The CONTRACTOR shall co-operate with COMPANY in
the identification and implementation of HSE performance improvement measures.  
  8.5 The CONTRACTOR shall routinely provide updates to the COMPANY of the HSE
Plan, refer to items 1.10 to 1.14, herein.     9.0 EMERGENCY RESPONSE     9.1
The CONTRACTOR GROUP shall co-operate with the COMPANY in providing an
appropriate response to emergencies occurring at COMPANY OFFSHORE FACILITIES and
WORKSITES.     9.2 The CONTRACTOR shall be required to provide an emergency
response support capability as defined by the SMS Interfacing process.     9.3
The CONTRACTOR shall co-operate with the COMPANY in ensuring that emergency
response arrangements are effective by taking part in simulation exercises as
requested by COMPANY.     9.4 The CONTRACTOR shall co-operate with the COMPANY
in providing an appropriate response to emergencies occurring at COMPANY
OFFSHORE FACILITIES and WORKSITES.

 

10 AUDIT AND ASSURANCE       The COMPANY reserves the right to access and audit
all processes and procedures relevant to ensure that WORK is carried out safely
without risk to health or the environment.     11 REFERENCE DOCUMENTS       In
the performance of the WORK, in addition to the CONTRACTOR’s own HSE Management
System, the CONTRACTOR shall refer to the appropriate systems that specify the
COMPANY’s HSE requirements. The COMPANY HSE Policy and Golden Rules are attached
below.

 

Approved by COMPANY.............Approved by CONTRACTOR.............

 

 

CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

[image_006.jpg]

 

Approved by COMPANY.............Approved by CONTRACTOR.............

 

 

CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

[image_007.jpg]

 

For further details on the COMPANY’s Golden Rules, please open the attached PDF:

 

[image_008.jpg]

 

Approved by COMPANY.............Approved by CONTRACTOR.............

 

 

CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

12.0 QUALITY ASSURANCE     12.1 It is a requirement of the CONTRACT that the
CONTRACTOR has a documented and maintained Quality Management System (QMS) to
control all aspects of the WORK     12.2 The CONTRACTOR shall upon request from
the COMPANY demonstrate an overview of its QMS, its parameters and operational
functionality and shall provide the COMPANY with a copy of any independent
certification of the system by an accredited body.     12.3 The CONTRACTOR is
required to develop and maintain a “contract specific” Quality Plan for the
WORK. The outline “contract specific” Quality Plan shall describe management
activities necessary to fulfil the requirements of the work including
organisation, personnel and resources. The outline “contract specific” Quality
Plan shall also describe how any proposed subcontracted supply and services will
be managed and describe Quality Control (QC) measures that will be used to
assure supply / services meet with specified requirements.     12.4 The
CONTRACTOR shall prepare and submit any audit schedule that it proposes to
initiate and maintain in connection with the provision of the WORK. The audit
schedule shall include sufficient audits to assure compliance with stated
quality requirements from the CONTRACT and the QMS. The COMPANY, or the
COMPANY’s nominated independent verification body, may wish to participate in
the contractor’s audits and / or perform its own audits of the contractoR’s
activities.     12.5 The CONTRACTOR shall participate in the COMPANY
Non-Conformance Reporting (NCR) and Performance Monitoring Systems and shall
accommodate the COMPANY QC requirements in all aspects of the WORK.     12.6
Quality requirement clarification meetings shall be held between the COMPANY and
the CONTRACTOR post-contract award; these meetings may produce additional and/or
more detailed quality and quality related requirements with which the CONTRACTOR
shall comply.     12.7 The CONTRACTOR shall, if requested, be able to provide to
the COMPANY an acceptable ‘Work History’ for all equipment supplied by
CONTRACTOR GROUP for the COMPANY’s operations. Such data may include, but not be
limited to hours run, damage history, maintenance history, certification and
testing history, manufacture and source information etc., in both written and
graphic form.     12.8 The CONTRACTOR shall maintain and, when required, be able
to demonstrate that it has procedures for inspection of all non-magnetic
equipment.     12.9 Any certification supplied should remain valid for the
period such equipment is expected to be offshore, where this is not the case,
the CONTRACTOR shall seek COMPANY acceptance and / or dispensation.

 

Approved by COMPANY.............Approved by CONTRACTOR.............

 

 

CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

SECTION VII

 

TRAINING

 

(Not Used)

 

Approved by COMPANY.............Approved by CONTRACTOR.............

 

 

CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

SECTION VIII

 

MATERIALS, SERVICES and FACILITIES to be PROVIDED by the COMPANY

 

Approved by COMPANY.............Approved by CONTRACTOR.............

 

 

CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

The COMPANY shall, in addition to its responsibilities defined elsewhere in the
CONTRACT, provide or be responsible for the following at no cost to the
CONTRACTOR:

 

1.0 The provision of such drawings, specifications and technical data and
information in connection with or regarding the WORK as is deemed appropriate by
the COMPANY REPRESENTATIVE.     2.0 The collection and re-delivery to the
CONTRACTOR’s premises all CONTRACTOR material and plant for transportation
offshore and provision of craneage at the COMPANY’s supply base;     3.0 The
supply and delivery to the offshore WORKSITE or the CONTRACTOR’s premises, as
appropriate, of COMPANY provided items in accordance with the dates or times
specified in any agreed programme.     4.0 The provision of travel to and from
the heliport (or in the case of sea transfer the embarkation point) and
COMPANY’s offshore installations, all offshore accommodation, messing and
medical facilities.     5.0 COMPANY to facilitate the provision of all mooring
equipment and charter of suitable deployment and recovery vessels in accordance
with CONTRACTOR approved PB3 loadout and recovery procedures. Recovery and
deployment of PB3 will be provided for at COMPANY expense and performed under
the supervision and instruction of CONTRACTOR. Permits and authorisations
required for deploying the PB3 shall be obtained and maintained by COMPANY    
8.0 All prices are exworks CONTRACTOR premises Monroe Township, New Jersey, USA,
CONTRACTOR to arrange delivery based on INCOTERM 2010 DAP to COMPANY designated
delivery port and back charge in advance to COMPANY. All costs associated with
quayside activity, storage and staging, transportation ex Aberdeen shall be
provided by COMPANY at COMPANY’s cost.     9.0 COMPANY shall pay sensor NRE
costs of more than $***.

 

***This information has been omitted in reliance upon Rule 24b-2 of the
Securities Exchange Act of 1934, as amended, and has been filed separately with
the Securities and Exchange Commission.

 

Approved by COMPANY.............Approved by CONTRACTOR.............

 

 

CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

Exhibit 1

 

INTRODUCTION

 

This document provides high level specification for PB3-A3 PowerBuoy™ for
Premier Oil (PMO).

 

Reference Documents

 

Below is the list of reference documents for this buoy.

 

  1. 800-6000-0000 PB3-A3 Buoy Assembly   2. 800-6000-0100 PMO Buoy Assembly

 

Acronyms

 

CG: Center of gravity

CB: Center of buoyancy

PTO: Power take-off

 

Buoy Characteristics

 

System Characteristics

 

Mechanical

 

  - Survival and fatigue design loads are derived from a 25 m deep North Sea
site   - Total float stroke: 1.5 m   - Free float stroke: 1.2 m   - Max
operational force: 15 kN   - Max operational velocity: 1.0 m/s   - Brake force:
22.5 kN

 

Electrical

 

  - Usable Energy Storage System(ESS) size: 30 kWh   - Battery type: Lithium Ion
  - Nominal HVDC bus voltage: 320 VDC   - Nominal LVDC bus voltage: 24 VDC   -
100 Mbit ethernet data connectivity

 

Physical Characteristics

 

Below are the high-level physical characteristics of the buoy.

 

  - Height: 13.0 m   - Length and Width: 3.0 m   - Dry mass: less than 10,000 kg

 

Approved by COMPANY.............Approved by CONTRACTOR.............

 

 

CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

Structure Specification

 

Bridge

 

  - Bridge has general-purpose mounting provisions for various equipment   -
Instruments on Bridge:

 

  1. Marine Beacon   2. Satelite tracker   3. Lightening rod   4. Radar
reflector

 

Float

 

  - Float trims at the mid-plane; the float displacement only supports the mass
of itself, bridge assembly and moving PTO components.   - The float guides
constrain the roll motion relative to the spar within 2 degrees (+/-1 deg).   -
The float guides constrain the yaw motion relative to the spar within 2 degrees
(+/- 1 deg).   - The float has lifting lugs for horizontal or vertical lifting
of the float halves.

 

Spar

 

Function

 

  - Spar houses the power conversion assembly, energy storage system, electrical
control panel, and autoballast system.   - Linear seal on the lid prevents water
ingress into the spar, while allowing low friction movement of the input rod

 

Design

 

  - Spar is designed based on loads during survival conditions resulting from
waves, float movements and 1.5 times the maximum hydrostatic pressure.

 

Ballast provisions

 

  - The auto ballast system is standard on PB3 PowerBuoys. This allows for
remote activation of ballasting and de-ballasting of the buoy.   - Manual (diver
assisted) ballasting provisions is available in case of emergencies.   - The
controlled balasting system feature allows the buoy to be towable horizontaly.
The operational ballast must be sufficient to trim the spar such that the float
mid-plane and spar mid-stroke is coincident. Ballast chamber has at least 10%
additional capacity to compensate for manufacturing weight tolerances.   -
Maximum allowable payload mass on the lid for PB3 is 140 kg   - Maximum
allowable payload mass on heave plate for PB3 is 950 kg

 

Mooring Connections

 

  - Spar has three upper and three lower mooring lugs.

 

Approved by COMPANY.............Approved by CONTRACTOR.............

 

 

CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

  - The mooring lugs are DNV certified for an optional tow-out operation.

 

Lifting

 

  - Spar has two lifting lugs on either side of the CG and capable of lifting
the assembled buoy.   - The lifting points are designed for offshore lifting
under the conditions described in DNVGLST-0001

 

Heave Plate

 

Design

 

  - Heave plate is designed for survival moment and axial forces.

 

Weight plates

 

  - Heave plate allows for bolting enough weight plates so that the buoy keels
in proper orientation during horizontal towing.

 

PowerBuoy™ Controls and Communications

 

Buoy Controller:

 

  - PowerBuoy control and comand function   - Local data collection and storage
  - Transmission of select data back to shore station   - HMI for real time
monitoring and control

 

Communications System:

 

  - Cellular modem with VPN capability   - Wi-Fi for local buoy control and
high-speed data transfer   - Satellite and fiber optic options are available,
but not part of the base buoy design

 

Approved by COMPANY.............Approved by CONTRACTOR.............

 

 

CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

Applicable Lid Interfaces

 

Upper Junction Box

 

Electrical Connections

 

Connector Size & Pin Count   Signal Description   Intended Use   Connection
Number M12, 4 Pin   24V Switched Power, 2 Pairs @ 2A Output Total   Upper
Junction Box Network Switch & Comms   J172 M12, 8 Pin   Ethernet & DC Power  
External Power & Ethernet   J105 M12, 8 Pin   24V Switched Digital Outputs, 4
Channels @ 1A Each Output   Payload Control   J79 M44, 4 Pin   320V Switched
Power, 1 Channel, 2 Pairs @ 12.5A Total Output   HVDC Ext Payloads   J14

 

Additional Sensors

 

COMPANY and CONTRACTOR shall mutually agree on sensors to be utlitised with the
PowerBuoy. Sensors shall be provided by the COMPANY to CONTRACTOR or COMPANY
shall be billed for sensors by the CONTRACTOR.

 

CONTRACTOR shall provide up to US$*** in Non-Recurring Engineering (NRE)
expenses to the COMPANY at no charge for integration of the sensors. NRE,
validation testing, and manufacturing labour costs exceeding US$*** will be
billed at CONTRACTOR’S standard rates, including profit and overhead.

 

Warranties and Representations

 

CONTRACTOR shall warrant Rental Equipment against defects in material and
workmanship during the RENTAL PERIOD, not to exceed one year from the
commencement of the RENTAL PERIOD. This warranty shall NOT cover, nor shall
CONTRACTOR be responsible for, any and all costs incurred for recovery,
handling, storage, and redeployment of defective Rental Equipment.

 

***This information has been omitted in reliance upon Rule 24b-2 of the
Securities Exchange Act of 1934, as amended, and has been filed separately with
the Securities and Exchange Commission.

 

Approved by COMPANY.............Approved by CONTRACTOR.............

 

 

CONTRACT NO: C2394

PROVISION OF INTELLIGENT MONITORING BUOY AND SUPPORT SERVICES

 

 

 

Exhibit 2

 

Contract Milestones

 

Date       Milestone No later than 11/5/2018   Delivery Date   PB3 delivered to
Premier Oil Aberdeen facility Not Later than 11/19/2018   Deemed “Fit for
Purpose”   Commencement of the Trial Period occurs the earlier of PB3 “deemed
fit for purpose” or fourteen (14) calendar days after delivery, unless the buoy
is “not deemed fit for purpose” within the fourteen (14) day period. 2/12/2019  
Initial Trial Completion   Completion of the first three-month rental period
8/12/2019   Six Month Option Completion   Completion of the remaining six-month
rental of the cumulative nine-month Rental Period 8/6/2019   Redelivery Date  
PB3 redelivered to Premier Oil Aberdeen facility by Premier Oil at the
conclusion of the Rental Period, subject to term of the Rental Period. This date
is intended to represent the end of the nine (9) month rental period.

 

The Place of Delivery is Monroe Township, New Jersey, USA

 

Success Criteria for the Three (3) Months Initial Trial Period

 

At the conclusion of the three-month initial trial period, and as a condition
for commencing the six-month option period, CONTRACTOR shall demonstrate to the
reasonable satisfaction of the COMPANY REPRESENTATIVE that the material
provisions of the following success criteria have been accomplished:

 

  ● The PB3 design and build quality supports the deployment, recovery and
operational requirements.   ● The PB3 has demonstrated its ability to be
successfully and securely moored, providing a platform on which native and 3rd
party equipment can operate.   ● Notwithstanding prolonged extreme weather
events, the PB3 has been able to provide all its consumers (native as well as
3rd party equipment) with continuous power and communications.   ● The PB3’s
internal housekeeping and (energy) management systems have been functional 24/7.
  ● Notwithstanding uptime of the communication links between the PB3 and OPT’s
onshore base, demonstrate the ability of OPT’s onshore condition monitoring
system to continuously collect, store and process housekeeping data from the PB3
offshore (excluding 3rd party equipment), and present this data to end users
onshore via a secure web portal and/or dedicated application.

 

Approved by COMPANY.............Approved by CONTRACTOR.............