exv10w1



 






Exhibit 10.1




	 	 	 
	

	 	NINOTSMINDA OIL COMPANY LTD
	 
	 	 
	 





DRILLING CONTRACT

No. S-NOC-1001/05




BETWEEN




NINOTSMINDA OIL COMPANY LTD




AND




SAIPEM S.p.A




	 	 	 
	 
	 
	 	 
	

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THIS AGREEMENT (the “Contract”), dated effective the _____ day of January 2005 , is made
between:




NINOTSMINDA OIL COMPANY (NOC) , a Company organised under the laws of Cyprus and having its
registered office at 22 Stasicratous, Olga court , P.O. Box 48, Nycosia , Cyprus (herein after
referred as the “Operator”)




SAIPEM S.p.A. a corporation organised under the laws of Italy ( herein after referred as the
“Contractor”), located at Via Martiri di Cefalonia 67, 20097 San Donato Milanese, Milano Italy.




Contractor and Operator in this Contract may be referred to individually as a “Party” and
collectively as the “Parties.”




WHEREAS, Operator desires to have wells drilled on land in the Operating Area, and to have
performed or carried out all auxiliary operations and services as detailed in the Appendices to
this Contract or as Operator may require; and

WHEREAS, Contractor is willing to furnish the drilling rig complete with camp, transport and other
equipment and personnel for the purpose of drilling such wells and performing such auxiliary
operations and services for Operator.




NOW THEREFORE, in consideration of the mutual promises and covenants set forth in this Contract,
the Parties agree as follows:




1) INTERPRETATION




1.1) Definitions.




In this Contract, unless the context otherwise requires:




“Appendix” and collectively, “Appendices,” means Appendix A, B, C, D, E and F, attached to and made
part of this Contract;




“Commencement Date” means the point in time that the Drilling Unit is rigged up, passed the
acceptance test and is ready to spud in the first well in the Operating Area. Commencement Date
shall take place in a window from the eighty (80) days to one hundred five (105) days from the
issuance of the irrevocable letters of credit as detailed in Article 9.5.




“Contractor’s Items” means the equipment, materials and services which are listed in the
Appendices that are to be provided by or at expense of Contractor;




“Contractor’s Personnel” means the personnel to be provided by Contractor from time to time to
conduct operations under this Contract, as listed in the Appendices;




	 	 	 
	 
	 
	 	 
	

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“Drilling Unit” means the land drilling rig IDECO E. 2100 No. 5827 complete with all Contractor’s
Items, spare parts and consumables necessary and advisable to complete the operations contemplated
by this Contract, and as specified in Appendix A, attached to and made part of this Contract.




“Drilling Period” means the time between Commencement Date and Termination Date.




“Operating Area” means those areas of land in Georgia, Manavi field (as directed by Operator) where
Operator may from time to time be entitled to conduct drilling operations;




“Operator’s Items” means the equipment, materials and services which are listed in the Appendices
that are to be provided by or at expense of Operator;




“Termination Date” means the date when the Drilling Unit is released by the Operator, with the mast
laid down, the mud tanks empty and available to the Contractor for preparing its move from the last
drilling location.




“Wilful Misconduct” means a wanton deliberate or reckless disregard of good and prudent oil field
practice as commonly used in the international petroleum industry by the Party concerned.




1.2) Currency.




In this Contract all amounts expressed in Dollars, are in United States of America (“USA”) Dollars.




2) TERM




2.1) Effective Date.




This Contract shall take effect when the Parties have both executed it.




2.2) Duration.




The Contract will commence on the date of its execution by both Parties and terminate on the
Termination Date. The drilling services contemplated by this Contract will be required to perform
operations on one (1) well “Firm Well” in accordance with the terms and conditions of this
Contract, subject to any extension in accordance with Article 2.3.




2.3) Options.




	 	 	 
	 
	 
	 	 
	

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Operator shall have the right at its sole discretion to extend the scope of the Contract in a back
to back sequence for up to two additional optional wells, to be located in Georgia, by delivery of
written notice to Contractor as follows :




First optional well : Operator shall exercise the option to drill the first optional well, as soon
as possible and in any case not later than 60 days after the well testing of Firm well has been
completed. The time from the moment the services are completed on the Firm well ( i.e. mast laid
down, mud tanks empty and drilling unit is available to the Contractor for preparing its move)
until operation are resumed will be remunerated as per art. 8.11 and Appendix B ( extended stand-by
rate without crew




Second optional well : Operator will confirm its intention to drill the second optional well not
later than sixty (60) days after the spud date of the first optional well.




2.4) Early Termination.




Notwithstanding any other provisions in this Contract to the contrary, Operator may, at any time
after the happening of any event set forth below, terminate this Contract forthwith without
obligation to pay any additional charge, early termination fee, demobilization lump sum fees, or
penalty (unless expressly provided otherwise in Articles 2.4 or 2.6) upon serving written notice of
termination on Contractor:




A. if the Drilling Unit is not available in the Contract Area within the end of the commencement
window (80 to 105 days from the issuance of the irrevocable letters of credit ) as defined in the
article 1.1 of this Contract , unless such event is caused by Force Majeure; or




B. if the Drilling Unit becomes an actual, constructive, or total loss, termination being from the
moment the loss occurs; or




C. should Contractor become insolvent or make an assignment for the benefit of creditors or be
adjudicated bankrupt or admit in writing its inability to pay its debts generally as the same
become due; or should any proceedings be instituted by Contractor under the laws of any country for
relief of debtors or for the appointment of a receiver, trustee or liquidator of Contractor; or
should a voluntary petition in bankruptcy or for a reorganisation or for an adjudication of
Contractor as an insolvent or a bankrupt be filed; or should an attachment be levied upon the
Contractor’s Items; or should any action be taken under the laws of the country where Contractor is
domiciled, or if Contractor sells or otherwise disposes of its interest in Contractor’s Equipment
(including the Drilling Unit), or reduces the number of its personnel, any or all of which could
materially impair Contractor’s ability to fulfil its obligations under this Contract; or




D. if Contractor is unable to perform its obligations under this Contract for a period of twenty
one (21) or more days due to a breakdown or failure of Contractor’s Drilling Unit; or




	 	 	 
	 
	 
	 	 
	

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E. if operations under this Contract are suspended for a period of fifteen (15) or more days due to
Force Majeure, in which case the demobilisation lump sum fee indicated under Appendix B shall be
applicable; or




F. If Contractor’s Personnel or Drilling Unit do not perform in accordance with international
oilfield standards for similar services in the reasonable opinion of Operator; or




G. If Contractor’s Drilling Unit does not perform in accordance with manufacturer’s specifications
for such Drilling Unit or the specifications set forth in Appendix A in the reasonable opinion of
Operator; or




H. If Contractor otherwise fails to comply with its obligations under this Contract, receives a
notice to remedy such breach from Operator, and fails to cure such breach within a period of five
(5) days.




I In case Operator find necessary to terminate the drilling program due to unexpected difficulties
encountered whilst drilling which materially hinder the continuation of the provision of the
drilling services contemplated by this contract.




2.5) Effect of Early Termination for Failure to Comply With Contract




If Operator terminates this Contract as provided for in Article 2.4, Operator shall only be
liable to pay Contractor for services properly performed and completed as of the date of
termination with the exclusion of point E in which case demobilisation fee shall remain applicable.
Such liability shall be without prejudice to any claim which Operator may have against Contractor
in terms of this Contract.




2.6) Early Termination at Operator Sole Discretion.




Even when Contractor is not in default of its obligations under the Contract, the Contract may be
terminated forthwith at the Operator’s sole discretion by delivery of written notice of termination
to Contractor at any time, subject to Operator payment to Contractor of the following lump sum
fees:




A. Before the Commencement Date:




The Operator shall then pay the early termination lump sum fee for such termination indicated under
Appendix B point 2 a ).




B. After the Commencement Date:




The Operator shall pay the early termination fee for such termination indicated under Appendix B
point 2 b).




	 	 	 
	 
	 
	 	 
	

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Operator notwithstanding anything to the contrary in this Contract shall in no case have any
obligation to pay any early termination lump sum fee or demobilization lump sum fee if the
Contractor obtains additional work for the Drilling Unit in direct continuity with the completion
of this Contract




2.7) Return of Operator Items.




Contractor shall return to Operator its items in the same condition as received from Operator
(normal wear and tear accepted ) as soon as possible and not later than thirty (30) days of the
Termination Date.




2.8) Area of Work.




The wells shall be drilled in Manavi Oil field, Georgia.




3) CONTRACTOR’S PERSONNEL




3.1) Personnel.




Contractor represents that it shall furnish Contractor’s Personnel, at Contractor’s cost, in the
numbers and classifications specified in Appendix D, attached to and made part of this Contract, to
perform the Contractor’s obligations under this Contract. The rates charged for Contractor’s
Personnel, reflecting Contractor’s costs, are set forth on Appendix D. Contractor’s rig
superintendent, tool pusher, tour pusher and drillers will have valid IWCF certificates (which
shall be exhibited to Operator on demand). Contractor further represents that Contractor’s
Personnel shall be competent and efficient and that each will be properly qualified, trained and
skilled to meet or surpass any qualifications for the specific assignment held and shall provide
evidence of this qualification to Operator upon request.




All of Contractor’s Personnel shall be deemed at all times to be employees solely of Contractor and
shall provide services under this Contract in accordance with the work schedules set forth in
Appendix D.




Contractor shall cause Contractor’s Personnel to be competent, safe and efficient. All Contractor’s
Personnel mobilised from or resident in countries outside the Operating Area shall be conversant in
both written and spoken English.




3.2) Increase in Contractor’s Personnel




Operator may, at any time, request Contractor to increase the number of Contractor’s Personnel, and
Operator shall reimburse Contractor for the direct costs incurred by Contractor in so doing as
detailed in Appendix B.




3.3) Transfer of Key Personnel




	 	 	 
	 
	 
	 	 
	

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It is understood and agreed that certain personnel of Contractor assigned to the drilling
operations are essential to the operations. Therefore, once the drilling operation has commenced,
Contractor shall not transfer any of Contractor’s Personnel without Operator’s prior approval. If,
with Operator’s approval, Contractor transfers any of Contractor’s Personnel, Contractor shall
arrange for replacement personnel of similar skills and experience to be immediately available, at
Contractor’s sole cost and expense.




3.4) Replacement of Contractor Personnel.




Contractor shall remove and replace any of Contractor’s Personnel if Operator so requests such
replacement in writing.




3.5) Contractor’s Representatives.




Contractor shall nominate one of its representatives who shall be in charge of the remainder of
Contractor’s Personnel and shall have full authority to resolve all day-to-day matters which arise
between Operator and Contractor.




3.6) Contractor’s Instructions




The Contractor agrees that it shall adequately instruct all of its Personnel on the use of plant,
equipment and safety apparatus, and proper work procedures for the purpose of doing everything
reasonably possible to protect against personal injury and damage to plant, equipment and the hole.
Contractor shall enforce adequate safety rules and procedures within the Operating Area and require
that Contractor’s Personnel observe such rules and procedures and cause Contractor’s Personnel to
observe all health, safety and environmental policies of Operator and any instructions of Operator
with respect to such policies.




3.7) Local personnel




For the purpose to provide the local personnel as per Schedule D, Contractor shall establish a plan
for their employment and training. For the opportunities of employment of Georgian personnel
Contractor shall consult with the Operator.




4) CONTRACTOR’S ITEMS.




4.1) Obligation to Supply Contractor’s Items.




Contractor shall provide the Contractor’s Items indicated in Appendices A and D, attached to and
made part of this Contract, and perform the services to be provided or performed by it according
to the Contract.




4.2) Maintain Stock of Contractor’s Items.




	 	 	 
	 
	 
	 	 
	

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Contractor shall be responsible, at its sole cost, for maintaining stock levels of Contractor’s
Items and replenishing them as necessary, including spare parts listed in Appendices A and D of
this Contract adequate to continue Contractor’s operations without interruption in accordance with
the provisions of this Contract.




4.3) Maintain and Repair Equipment.




Contractor shall be responsible for the maintenance and repair of all Contractor’s Items and shall
provide all spare parts, consumables and materials required for such maintenance and repair.
Contractor shall, if requested by Operator, also maintain or repair, at its cost, any of Operator’s
Items which Contractor is qualified in Contractor’s reasonable opinion to and can maintain or
repair with Contractor’s normal complement of personnel and equipment provided, however, that
Operator shall at its cost provide all spare parts, consumables and materials required to maintain
or repair Operator’s Items and the basic responsibility and liability for furnishing and
maintaining such items shall remain in Operator.




4.4) Inspection of In-hole Equipment




Prior to commencement of drilling operations under this Contract, Contractor shall, at Contractor’s
sole expense, cause a recognised inspection service company to inspect all in-hole equipment to be
used by Contractor in the performance of this Contract. Operator shall be furnished with copies of
all inspection reports. Any drill pipe not passing Premium Grade (API RP 7G) shall be rejected and
immediately replaced at Contractor’s expense by other drill pipes checked and graded Premium Grade
or better. Any drill collars showing defects shall be re-cut or replaced at Contractor’s expense
by new drill collars or alternatively by other re-cut drill collars in accordance with drill collar
specifications. After the above initial inspection of the in hole equipment, all other inspections
will be carried out by Contractor at Operator’s cost.




5) CONTRACTOR GENERAL OBLIGATION.




5.1) Performance of Drilling Unit




Contractor represents and warrants to Operator that the Drilling Unit is capable of: i) drilling to
a depth of 20,000 feet ii) performing in accordance with all manufacturer’s specifications and the
specifications set forth in Appendix A iii) operating in environmental condition from a minimum
of - 15 degrees Celsius up to a maximum of 45 degrees Celsius iv) handling oil base mud up v) mud
weight up to 2.2 specific gravity.




Contractor shall provide Operator with manufacturer’s specifications for all or part of the
Drilling Unit at any time requested by Operator.




5.2) Contractor Standard of Performance




	 	 	 
	 
	 
	 	 
	

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Contractor shall carry out all operations under this Contract on a day work basis. For this
purpose, the term “day work basis” means Contractor shall furnish equipment labour and perform
services as provided in this Contract, for a specific sum per day under the direction supervision
and control of Operator (which term is deemed to include any employee, agent consultant or
subcontractor engaged by Operator to direct drilling operations). When operating on a day work
basis, Contractor shall be fully paid at the applicable rates of payment and assumes only the
obligations and liabilities stated in this Contract. Contractor shall comply with all current laws
covering Contractor’s operations of the Drilling Unit under this Contract.




5.3) Operations of Drilling Unit




Contractor shall be solely responsible for the operations (including the mobilisation and
demobilisation) of the Drilling Unit, including, without limitation, supervising moving operations,
and positioning the Drilling Unit and camp at location as required by Operator, as well as such
operations at drilling site as may be necessary or desirable for the safety of the Drilling Unit.
Operations under this Contract will be performed 24 hours per day.




5.4) Compliance with Operator’s Instruction




Contractor shall comply with all instructions of Operator consistent with the provision of this
Contract including, without limitation, drilling, well control and safety instructions. Such
instruction shall be confirmed in writing by the authorised representative of Operator. However,
Operator shall not issue any instruction which would be inconsistent with policies and procedures
jointly agreed by Contractor and Operator in writing in “bridge documentation” or otherwise.




5.5) Mud and Casing Program.




Contractor shall follow the mud and casing program as specified by Operator. Operator shall provide
these programs for each well in advance of the spud date of each well to be drilled under this
Contract.




5.6) Records to Be Kept By Contractor.




Contractor shall keep and furnish to Operator an accurate record of the work performed and
formation drilled on IADC-API Daily Drilling Report Form and other record-keeping as may be
directed by Operator. A legible copy of such form signed by Contractor’s representatives shall be
furnished by Contractor to Operator on a daily basis. All drilling reports shall be kept and
recorded in English.




5.7) Safety Equipment




	 	 	 
	 
	 
	 	 
	

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Contractor shall maintain and test its well control equipment listed in the Appendices in good
condition at all times in accordance with internationally accepted oilfield practices. Contractor
shall use all reasonable means to control wells, to prevent fires and blowouts and to protect the
well during all drilling and completion operations.




6) OPERATOR OBLIGATION.




6.1) Equipment and Personnel




Operator shall at its cost provide Operator’s Items and Operator’s Personnel and perform the
services to be provided by it according to the Contract. Operator’s Items and Personnel are set
forth on Appendices A and D, attached to and made part of this Contract. Operator shall maintain
an inventory of Operator’s Items and keep them available to Contractor to support drilling
operations under this Contract. When, at Operator’s request and with Contractor’s agreement, the
Contractor furnishes or subcontracts for certain items or services which Operator is required to
provide in accordance with this Contract, such items or services shall be deemed to be Operator
furnished items or services.




For furnishing such items and services, Operator shall reimburse Contractor the properly documented
cost incurred by Contractor in providing such items or services, plus ten percent (10 %) handling
fee.




6.2) Maintenance and Repair




Operator shall be responsible, at its cost, for the maintenance and repair of all Operator’s Items
which Contractor is not qualified to or cannot maintain or repair with Contractor’s normal
complement of personnel and equipment.




6.3) Custom or Excise Duties




Operator shall pay all (if any) import charges or custom duties including, without limitation,
local sales taxes, value added taxes, or other similar taxes or fees that are levied on the import
and export of Contractor’s Items into or from the Operating Area for purposes of performing this
Contract, or between countries within the Operating Area. All imports or exports of Contractor’s
Items into or from the Operating Area shall be at the direction and in the name of Operator in
order to utilise customs reductions and exemptions available to Operator, and Operator shall have
no obligation to pay such additional duties and taxes on import and export of Contractor’s Items
levied as a result of Contractor’s failure to comply with the provisions of this Article 6.3.




6.4) Drill Site and Access




Operator shall provide Contractor with access to the drilling sites as well as any drilling
permits, licenses or certificates needed to conduct operations under this




	 	 	 
	 
	 
	 	 
	

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Contract. The drilling
site shall be surveyed and marked by Operator and shall be free of obstructions. Contractor shall
co-operate with Operator in obtaining such
drilling permits, licenses or certificates and shall fully comply with the requirements for all
such permits, licenses or certificates; provided, however, that Contractor shall be solely
responsible for obtaining at it’s own cost a GOSGORTECHNADZOR technical passport or similar
certification for its Drilling Unit and related equipment.



Operator also shall prepare sound locations capable of properly supporting the drilling rig, and
shall be responsible for a conductor pipe program adequate to prevent soil and subsoil washout.
Contractor shall supply dimensions and loadings to Operator for site preparation promptly upon
request by Operator.



Operator shall advise Contractor of any significant surface condition, or obstruction which
Contractor might encounter while en route to the location of which Operator is aware. Operator’s
provision of such assistance shall not be deemed to constitute a warranty of the safety or
reliability of any location or route. Prior to moving the rig to the operating area the Contractor
shall survey and accept the drilling location and the proposed route to that new drilling location.



7.TAXES



7.1) Reimbursed Taxes



Operator shall reimburse Contractor for income tax, profit tax, property tax and other similar tax
of a general nature on the Contractor’s income from operations in the Operating Area under the
Contract levied by governmental authorities in Georgia, expressly including withholding tax but
excluding without limitation tax on or related to Contractor’s personnel or subcontractors
(collectively, the “Reimbursed Taxes”)



It is understood and agreed that as of the date of this Contract, the income tax rate applicable to
Contractor (as to the “non resident Subcontractor” under the Oil and Gas Law of Georgia) is set at
four percent (4%) of the amounts payable by the Operator to Contractor in accordance with article 8
of this Contract.



7.2) Tax Reporting



Contractor agrees to prepare and timely file all required income or other tax returns and
declarations required by the government of the area where the Drilling Rig operates under this
Contract and timely make all tax payments when due. Contractor shall consult with Operator before
filing any such tax returns or paying the applicable taxes. Contractor shall provide Operator
monthly copies of all such filings and a summary of such payments, include filings and payments for
personnel taxes.




	 	 	 
	 
	 
	 	 
	

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Contractor shall provide tax receipts to Operator for all taxes and other similar
charges to be reimbursed by Operator to Operator’s satisfaction.



7.3) Reimbursement of Reimbursed Taxes



Upon delivery of notification by the Contractor to the Operator of the amount of such taxes paid by
Contractor which pertain to performance by Contractor under this Contract, accompanied by copies of
each such return or declaration, Operator shall reimburse Contractor the amount of any Reimbursed
Taxes: provided, however, that Contractor has complied with all the provisions of this Article 7
and Operator does not dispute such Reimbursed Taxes. Notwithstanding the foregoing, Operator shall
in no event be liable for (i) Reimbursed Taxes levied or increased as a result of Contractor’s
failure to consult with or follow the directions of Operator (it being expressly acknowledged by
Contractor that Operator may have available to it exemptions or reductions of applicable taxes for
which special procedures may be necessary) or (ii) resulting from interest, penalties, legal fees
or other charges or costs applicable to assessments, administrative sanctions or judicial
proceedings by tax authorities as a result of Contractor’s failure to consult with or follow the
directions of Operator.



7.4) Refunds



In the event that Contractor becomes aware that it is entitled to any refund of Reimbursed Taxes,
it shall promptly inform Operator in writing of such entitlement. In the event Contractor receives
such refund, Contractor shall promptly pay such refund in full to Operator. The provisions of this
Article 7.4 shall survive termination of this Contract.



7.5) Change in Legislation



In the event that the legislation of any country in the Operating Area changes (or the
interpretation of such law changes) during the term of this Contract and Contractor as a result
suffers a material and direct economic disadvantage, including a material increase in the personnel
taxes to which it is subject, the Contractor may request Operator in writing for an increase in
rates to compensate for the loss thus incurred by Contractor. If Contractor and Operator cannot
agree on such adjustment within ninety (90) days of its written submission to Operator, then
Contractor shall have the right to terminate this Contract by delivery of written notice of
termination to Operator.



7.6 Cooperation to Minimise Tax



The Parties shall cooperate to minimise their mutual tax obligations in the Operating Area and
maximise the utilisation of tax benefits available to Operator in the Operating Area.




	 	 	 
	 
	 
	 	 
	

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8) RATES OF PAYMENT



8.1) Payment



Operator shall pay to Contractor during the term of this Contract the amount from time to time due
at the rates of payment set forth in this Article 8 and in accordance with the other provisions of
this Contract. No other payment shall be due from Operator unless specifically provided for in this
Contract, or agreed to in writing by Operator. The amounts shown in this Contract Appendix B are
not inclusive of VAT which may be applicable in Georgia.



8.2) Mobilisation Fee.



Operator shall pay Contractor the lump sum Mobilisation Fee indicated under Appendix B herewith
attached, and made part of this Contract, for mobilising Contractor’s Equipment, including the
Drilling Unit from the port or place at which the mobilisation of the Drilling Unit commences to
Operator’s Drilling Location at the commencement of this Contract and for completely rigging-up to
commence the drilling of the first well under this Contract.



The Mobilisation Fee shall be deemed to cover all costs and expenditures of whatever nature
incurred by Contractor in mobilising all of Contractor’s Equipment and Contractor’s Personnel to
Operator’s Drilling Location. The Operating Rate shall commence at such time as Operator accepts
the Drilling Unit (as per the attached acceptance procedures) as being fully rigged up, ready and
able to commence drilling operations under this Contract (Drilling bit ready to pass through the
rotary table). The Parties shall perform the acceptance test in accordance with the acceptance
procedures and time requirements set forth in Appendix E. In the Mobilisation Fee are included two
days ( 48 hours ) to perform the acceptance test; in the event Operator decides to further continue
the acceptance test and not for reasons attributable to Contractor the Stand By rate shall start to
be applicable up to the moment the applicable daily rate shall start.



8.3) Demobilisation Fee



Once satisfactory completion of drilling operations under this Contract has occurred, the tree cap
is installed and tested, all day rates shall cease and Contractor shall commence rigging-down
operations in preparation for demobilisation. Upon completion of demobilisation, Operator shall
pay Contractor the lump sum Demobilisation Fee indicated under Appendix B which shall be deemed to
cover all costs and expenditures of Contractor in completely rigging down and demobilising
Contractor’s Equipment, including the Drilling Unit, from Operator’s last location drilled under
this Contract to the place where demobilisation of the Drilling Unit ceases. The demobilisation
fee shall also include the cost of demobilising all of Contractor’s Personnel. No demobilisation
payments shall be payable by Operator if




	 	 	 
	 
	 
	 	 
	

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the Contractor obtains additional work for the Drilling
Unit in direct continuity with the completion of this Contract.



8.4) Moving Remuneration



The moving between location shall be remunerated to Contractor in accordance to one of the
following options which Operator has to select by giving written notice to Contractor within thirty
(30) days from Commencement Date (or in terms of the first optional well within thirty (30) days of
the spud date of the first optional well).



Option 1- Daily rate basis



For the time spent to move the Drilling Unit between locations the Moving Rate shall apply. The
Moving Rate as detailed in appendix B shall commence when the tree cap is installed and tested, the
mast laid down, the mud tanks empty and shall cease when Contractor is ready to pick up bit on next
location. In the event the moving between location starts following an extended stand by period of
the Drilling Unit the moving rate shall start when the first load leaves the drilling location.
Transportation facilities in addition to those provided by Contractor by the contract, shall be
furnished by Operator at its care and charge, or upon Operator request shall be furnished by
Contractor, and Operator shall reimburse Contractor the relevant documented cost plus the
applicable overhead as per article 6.1. The Moving Rate without crew ( as per point I) b)
appendix B) will be applicable only if the moving operations will be performed to a stacking area
following Operator notice to apply the extended stand-by rate without crew at completion of the
well.



For the avoidance of doubt the Moving Rate shall cover all costs incurred in moving the Drilling
Unit between locations and no additional monies shall be payable except for the above fore
mentioned relevant documented cost plus applicable article 6.1 overhead.



Option 2- Lump sum basis



The Moving Lump Sum Fee indicated under Appendix B shall apply to periods during which the
Contractor’s Equipment, including the Drilling Unit, are being moved between Operator’s Drilling
Locations. The Moving Lump Sum Fees shall apply to the period commencing when the tree cap is
installed and tested and shall cease when Contractor is ready to pick up bit on the next drilling
location.



This Article 8.4 shall not apply when mobilising to and rigging up on the first location drilled
under this Contract and tearing down and demobilising from the last location so drilled. The Moving
Lump Sum Fee shall be deemed to cover all costs and expenditures of whatever nature incurred by
Contractor in mobilising all of Contractor’s Equipment and Contractor’s Personnel between
Operator’s Drilling Locations



8.5) Operating Rate.




	 	 	 
	 
	 
	 	 
	

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The Operating Rate indicated under Appendix B will first become payable from the moment when the
Drilling Unit spuds the first well at the first drilling location (The bit pass through the rotary
table). The Operating Rate shall continue to be payable while
Contractor drilling operations continue in accordance with this Contract and except as otherwise
provided in this Contract.



8.6) Standby Rate With Crew.



The Standby Rate indicated under Appendix B shall apply and shall be payable:



(a) Whenever the Drilling Unit is shut down at Operator’s request and the Drilling Unit is standing
by with full crews, or during that time when Contractor is waiting on Operator’s orders or Operator
furnished items or services if during such waiting periods Contractor’s drilling string is not in
use.



(b) From the moment the Contractor could have spudded in the first well and it has been delayed by
Operator until the Operating Rate shall apply .



(c) In case of impossibility to continue moving operations due to road/locations problems not
under Contractor’s control.



8.7) Repair Rate.



In the event Contractor is unable to conduct normal operations as required under this Contract
solely because of a material breakdown or failure of any of Contractor’s Equipment, including the
Drilling Unit, (as distinguished from normal rig maintenance), Operator shall pay Contractor at the
Equipment Repair Rate indicated under Appendix B. The Equipment Repair Rate shall apply from the
time such breakdown or failure occurs until normal operations are resumed or terminated.
Notwithstanding the above, the Repair Rate will be zero (0) after Contractor has been unable to
conduct normal operations for the reasons set out above, for a total of twenty-four (24) hours per
thirty (30) days (not cumulative month by month) period and will remain zero (0) until the breakage
or failure of Contractor’s Equipment, including the Drilling Unit, is remedied. Daily maintenance
and inspections such as lubrication, packing of swivels, slipping and cutting drill lines, top
drive system normal maintenance as per manufacturer’s instructions shall not be deemed as repair
time.



8.8) Remedial Rate.



The Remedial Rate indicated under Appendix B shall be payable during the period in which Contractor
is re-drilling the borehole in accordance with Article 10.2.



8.9) Force Majeure Rate.



The Force Majeure Rate indicated under Appendix B shall be payable during any period in which
operations are not being carried on because of Force Majeure and




	 	 	 
	 
	 
	 	 
	

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the Contract has not been
terminated, subject to termination of the Contract for Force Majeure in accordance with Article
2.4(E).



8.10) Extended Standby Rate with crew.



The Extended Standby Rate indicated under Appendix B shall be payable during the period of any well
test or geological evaluation exceeding seven (7) days and not exceeding sixty (60) days. During
this period the full rig crew and Contractor equipment shall remain at Operator disposal.



8.11) Extended Standby Rate Without Crew



The Extended Standby Rate Without Crew indicated under Appendix B will be applicable in case
Operator stops the operation for further geological evaluation up and removes all Contractor
Personnel upon seven (7) days prior notice and not exceeding sixty (60) days. Contractor shall
recommence the operations after Operator gives fifteen (15) days prior notice to Contractor.
Operator shall pay Contractor the rates specified in Appendix B per 24 hour days. Operator will
reimburse Contractor transportation costs for returning personnel to their point of origin during
such period and again upon returning the personnel to Operating Area immediately prior to the
re-commencement of Operations.



The rate applicable will be an escalating rate. After the first month of application the rate
will be increased by 1.35 times each following month.



8.12) Force Majeure Rate Without Crew.



The Force Majeure Rate Without Crew indicated under Appendix B will be applicable in case Operator
decides to stop the operation and remove all Contractor Personnel upon seven (7) days prior notice
for reasons of Force Majeure. Contractor shall recommence the operations after Operator gives
fifteen (15) days prior notice to Contractor. Operator shall pay Contractor the rates specified in
Appendix B per 24 hour days. Operator shall reimburse Contractor transportation costs for returning
personnel to their point of origin during such period and again upon returning the personnel to the
Operating Area immediately prior to the re-commencement of Operations.



9) INVOICES AND PAYMENT



9.1) Monthly Invoices



Contractor shall bill Operator at the end of each month for all daily charges earned by Contractor
during the month. Other charges shall be billed at the end of the month in which they were
incurred. Billing for daily charges will reflect details of the time spent (calculated to the
nearest hour) and the rate charged for the time. Billings for other




	 	 	 
	 
	 
	 	 
	

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charges will be accompanied by
invoices supporting costs incurred for Operator or other substantiation as required by Operator.



9.2) Payment



Operator shall pay by wire transfer all billings within thirty (30) days after the receipt of such
billings, except that if Operator disputes an item billed, Operator shall within twenty (20) days
after receipt of the bill notify Contractor of the item disputed, specifying the reason therefore,
and payment of the disputed item shall be withheld until settlement of the dispute. Payment shall
be made of any undisputed portion. If Operator refuses to pay undisputed items, Contractor shall
have the right to terminate this Contract.



9.3) Manner of Payment.



All payment due by Operator to Contractor under this Contract shall be made in USA Dollars to
Contractor’s account to be indicated under Contractor’s invoices.



9.4) Late Payment



If Operator fails to pay Contractor undisputed amounts invoiced within thirty (30) days after
receipt of the applicable invoice, Contractor shall be entitled to interest, calculated quarterly,
on the undisputed amount remaining unpaid at the London Interbank Offering Rate (“LIBOR”). LIBOR
for purposes of this Contract shall mean the rate per quarter at which USA Dollar deposits of six
(6) months duration are offered to prime banks in the London Inter Bank Market, as quoted in the
Wall Street Journal as in effect for the first business day of the quarter for which LIBOR is to
be determined.



9.5) Payment Guarantee



Payment under this Contract shall be guaranteed through the issuance of irrevocable Standby Letters
of Credit (herein after LC) as per the following specifications.



LC are issued for an aggregate amount as stated under Appendix F.



LC are to be issued by a first class international bank at least rated A by Standard & Poor’s to be
agreed between parties within 20 days from contract signature and will be payable at sight and on
first demand without restriction or conditions and notwithstanding any objection by the COMPANY
against presentation to the confirming/negotiating bank of the documents specified on LC forms
included in Appendix “F”.



Failure by Operator to comply with the above, may cause an early termination of Contract by
Contractor without notice and without juridical formalities.




	 	 	 
	 
	 
	 	 
	

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Should the drilling activities continue in accordance with art. 2.3 or for any other reason, beyond
October 30, 2005, then Operator, 10 working days prior to expiry date, shall cause LC2 to included
in Appendix F to be extended up to a new date accepted by the Contractor, likewise the expiry date
of December 2005 for LC3 shell be extended by the same additional numbers of days.



Failure of this procedure by Operator will cause an early termination of the Contract without
notice and without juridical formalities.



10) LIMITATION OF LIABILITY



10.1) Equipment or Property



Except as specifically provided in this Contract to the contrary, each Party shall at all times be
responsible for and shall hold harmless and indemnify the other Party from and against damage to or
loss of its own equipment or property, howsoever owned, regardless of the cause of loss, including
the negligence of such Party, and despite the fact that a Party’s items may be under the control of
the other Party, except that:



(a) Operator shall be responsible for damage to or loss of Contractor’s drill string in the event
of its loss, destruction or damage in the borehole. In such event, Operator shall pay to
Contractor the following:



A. For damaged equipment that is repairable, the lesser of either the cost of repairs or the
replacement cost less an allowance for depreciation.





	B.  	For equipment lost, destroyed or damaged beyond repair, the replacement cost less the
depreciation as per the following depreciation factor. The depreciation shall be calculated
by multiplying the replacement value by the depreciation factor for each month of actual use,
dated from commencement date of this Contract, provided that at no time shall the value of the
equipment lost, destroyed or damaged beyond repair be less than forty percent (40%) of the
replacement cost at the time such loss, destruction or damage occurred.
	 
	   	For new item the depreciation shall apply to 100% of the replacement value, for used items
the depreciation shall apply to 75% of the replacement value. Transportation cost shall be
added to the above at documented cost.
	 
	   	The schedule for straight line depreciation shall be as follows:





	 	 	 
	Drill Collars, Drill Pipe, Reamers, Stabilisers, Bumper Subs

	 	1.0% per month
	 
	 	 
	And Other In-hole Equipment

	 	2.0% per month







	     	At the time Contractor claims the right to reimbursement for such damage to, loss or
destruction of Contractor’s in-hole equipment as set forth above, Contractor shall submit
with Contractor’s invoice for reimbursement, evidence





	 	 	 
	 
	 
	 	 
	

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	     	of the number of days of use from
commencement date, the replacement cost and the depreciation value for such equipment.




However, Contractor shall be responsible for damages to or loss of Contractor drilling string in
the event its loss, destruction of damage in the borehole is due to Contractor negligence or Wilful
Misconduct.



10.2) The Hole.



Operator shall be solely responsible for damage to or loss of the borehole and other damage below
the surface, including the casing. If such damage or loss was caused wholly or partially by the
negligence or wilful misconduct of Contractor, its employees, agents or subcontractors, then
Contractor shall at Operator’s direction, drill a new borehole in the same location or re-drill
such section of the borehole as Operator may require at the Remedial Rate indicated in Appendix B.



10.3) Inspection of Materials Furnished by Operator.



Contractor agrees to visually inspect all materials furnished by Operator before using such
materials and to notify Operator of any apparent defects in such materials. Contractor shall not be
liable for any loss or damage resulting from the use of materials furnished by Operator.



10.4) Contractor’s Personnel.



Contractor agrees to protect, defend, indemnify, and hold harmless Operator, its officers,
directors, employees and joint owners from and against all claims, demands, and causes of action of
every kind and character for bodily injury, death or damage to property, without limit and without
regard to the cause or causes of such injury, death or damage or the negligence of any Party or
Parties, in favour of Contractor’s employees or Contractor’s subcontractors or their employees, or
Contractor’s invitees.



10.5) Operator’s Personnel.



Operator agrees to protect, defend, indemnify, and hold harmless Contractor, its officers,
directors, employees and joint owners from and against all claims, demands, and causes of action of
every kind and character for bodily injury, death or damage to property, without limit and without
regard to the cause or causes of such injury, death or damage or the negligence of any Party or
Parties, in favour of Operator’s employees or Operator’s subcontractors or their employees, or
Operator’s invitees.



10.6) Pollution and Contamination.




	 	 	 
	 
	 
	 	 
	

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Notwithstanding anything to the contrary contained in this Contract, it is understood and agreed by
and between Contractor and Operator that any responsibility for pollution or contamination shall be
as follows:



(a) Contractor shall assume all responsibility for cleaning up and containing pollution or
contamination which originates above the surface of wells drilled in accordance with this Contract
from improper care or disposal of items in Contractor’s possession and control and directly
associated with Contractor’s equipment and
facilities and shall protect, defend, indemnify and save the Operator harmless from and against all
claims, demands and causes of action of every kind and character arising directly or indirectly
from all such pollution or contamination.



(b) Operator shall assume all responsibility for cleaning up and containing pollution or
contamination which originates below the surface (other than as provided to be Contractor’s
liability in Article 10.6(a) above) and shall protect, defend, indemnify and save the Contractor
harmless from and against all claims, demands and causes of action of every kind and character
arising directly or indirectly from all such pollution or contamination.



10.7) Cost of Control.



Operator shall be liable for the cost of regaining control of any wild well and shall indemnify
Contractor for any such cost regardless of the cause, including, but not limited to, the negligence
of Contractor, its agents, employees or subcontractors, and excluding Wilful Misconduct of
Contractor.



10.8) Underground Damage.



Operator agrees to defend and indemnify Contractor for any and all claims including, but not
limited to, claims arising as a result of the negligence of Contractor, its agents, employees or
subcontractors against Contractor resulting from operations under this Contract on account of
injury to, destruction of, or loss or impairment of any property right in or to oil, gas, or other
mineral substance or water, which at the time of the act or omission causing such injury,
destruction, loss, or impairment, such substance had not been reduced to physical possession above
the surface, and for any loss or damage to any formation, strata, or reservoir beneath the surface.



10.9) Consequential Damages.



Neither Party shall be liable to the other for special, indirect or consequential damages resulting
from or arising out of this Contract, including, without limitation, loss of profit, loss of
production, loss of use or business interruptions, however caused.



10.10) Indemnity Obligation.




	 	 	 
	 
	 
	 	 
	

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Except as otherwise expressly limited in this Contract, the Parties intend that all indemnity
obligations and/or liabilities assumed by such Parties under terms of this Contract, including,
without limitation, clauses 10.1 through 10.9, be without limit and without regard to the cause or
causes thereof (including pre-existing conditions), strict liability, or the negligence of any
Party or Parties, whether such negligence be sole, joint or concurrent, active or passive.



11) INSURANCE



11.1) Contractor’s Insurance.



Contractor shall carry and maintain the Insurance shown hereunder for the duration of this
Contract. Contractor may from time to time with the prior approval of Operator change the insurance
it carries. Contractor will increase its insurance beyond the limits provided in this Contract or
will change its insurance if required by Operator, but any additional cost of additional insurance
premiums will be paid by Operator.





	 	•  	Workmen’s Compensation and Employer’s liability Insurance as shall be
necessary to cover all Contractor personnel while engaged in the performance of the work
under this contract
	 
	 	•  	Comprehensive general liability insurance coverage with policy limits not less
then 1,000,000 USD for personnel injury , death or property damage resulting for each
occurrence and covering all Contractor’s operations under this contract
	 
	 	•  	Automobile Liability insurance covering owned , non-owned and hired motor
vehicles of Contractor with limit in accordance to applicable local laws for personnel
injury , death or property damage resulting for each occurrence.
	 
	 	•  	All risk insurance covering the Contractor Equipments including the Drilling
Unit (except down-hole equipments such us tubulars, cross overs .




11.2) Policies and Receipts.



Contractor will furnish Operator on request, with certificates of all its insurance policies
relating to Contractor’s operations under this Contract and provide thirty (30) days prior written
notice to Operator of any change or cancellation of such policies.



11.3) Subrogation.



For liabilities assumed under this Contract by Contractor, its insurance shall be endorsed to
provide that the underwriters waive their right of subrogation against Operator.



12) ASSIGNMENT.



The Operator shall be entitled to assign its rights, obligations and duties under the Contract to
any affiliate, provided that the Operator shall remain liable for and shall




	 	 	 
	 
	 
	 	 
	

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not be relieved of any
of its obligations under this Contract both before and after such assignment.



Neither Party shall have the right to assign this Contract to any third party without prior
approval of the other Party. Such approval shall not unreasonably withhold.



13) NOTICES.



Notices, reports and other communications required or permitted by this Contract to be given or
sent by one Party to the other Party shall be delivered by hand or mailed to the following :




To CONTRACTOR



SAIPEM S.p.A

For Operational matters



Mr. Corrado Bottazzi

Fax 00971-6-5283045

E-mail: corrado.bottazzi@saipem.eni.it



For Commercial matters



Mr. Fabio Rondini

Fax: 0039-02-52044709

E-mail : fabio.rondini@saipem.eni.it



To OPERATOR



NINOTSMINDA OIL COMPANY LTD



Mr. Niko Tevzadze

Fax: 00995 32 932892

E-mail: niko@gboc.ge


14) MISCELLANEOUS.



14.1) Confidential Information



The Contractor shall keep any and all Information disclosed to Contractor in the course of
performance of this Contract strictly confidential and shall not use, publish reproduce, copy,
trade or otherwise disclose such Information for any purpose not directly related to performance of
this Contract. “Information” for this purpose shall include without limitation geological and
geophysical data, maps models, interpretations, drilling logs and records, cores, fluid samples,
and commercial, contractual and financial information related to prospectitivity of the Operating
Area




	 	 	 
	 
	 
	 	 
	

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and Operator’s business in the Operating Area. Such Information shall be the sole property of
Operator. Contractor shall cause its employees, officers, directors, agents and representatives to
fully and completely observe the confidentiality and other restrictions of this Article 14.1
imposed upon Contractor.



14.2) Governing Language



The Governing language of the Contract shall be English



14.3) Force Majeure.



Except as otherwise provided in this Article 14.3, each Party to this Contract shall be excused
from complying with the terms of this Contract, except for the payment of moneys then due, if and
for so long as such compliance is prevented by riots, strikes, wars (declared or undeclared),
insurrections, rebellions, terrorist acts, civil disturbances, dispositions of orders of
governmental authority, whether such authority be actual or assumed, acts of God (other than
weather conditions) or by act or cause which is reasonably beyond the control of such Party, such
causes being herein sometimes called “Force Majeure.” If any such failure is occasioned by a
governmental law, rule, regulation, disposition or order as and the affected Party is operating in
accordance with good oilfield practice in the area of operations and is making reasonable effort to
comply with such law, rule, regulation. disposition or order, the matter shall be deemed beyond the
control of the affected Party. In the event that either Party is rendered unable, wholly or in
part, by any of these causes to carry out its obligation under this Contract, it is agreed that
such Party shall give notice and details of Force Majeure in writing to the other Party as promptly
as possible after its occurrence. In such case, the obligations of the Party giving the notice
shall be suspended during the continuance of any inability so caused except that Operator shall be
obligated to pay to Contractor the Force Majeure Rate provided for in Appendix B. Either Party
shall have the right to terminate this Contract for Force Majeure after fifteen (15) days of Force
Majeure have passed in accordance with Article 2.4(E).



14.4) Right to Audit



Contractor shall keep proper books, records and accounts of operations under this Contract and
shall permit Operator at all reasonable times to inspect the portions of such books, records and
accounts related to any variation of the rates hereunder. All such books, records and accounts
shall be available for inspection during this Contract and for at least 12 months following the
termination of this Contract. All such books and records shall be kept in English in accordance
with generally accepted accounting practices.



14.5) Waivers




	 	 	 
	 
	 
	 	 
	

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It is fully understood and agreed that none of the requirements of this Contract shall be
considered as waived by either Party unless done in writing, and then only by the duly authorised
agent or representative of the Party.



14.6) Entire Agreement



The Contract together with the Appendices attached supersedes any oral or written communications
made between the Parties prior to execution of the Contract and relating to the Operations.



14.7) Publicity



Articles, films or comments to the press about the services shall not be prepared, made by the
Contractor or allowed to be made by Subcontractors, or any Third Party unless, such articles films,
or comments are submitted to Operator in advance and the prior written consent of Operator is
obtained.



14.8) Independent Contractor



Contractor shall perform this Contract as an independent contractor. Nothing in this Contract or
in the relationship of the Parties shall be construed as creating a joint venture, partnership,
association, fiduciary relationship, company or any other legal entity, or the relationship of an
employer and employee between Contractor and Operator other than that of independent contractors.



14.9) Cooperation with Others



Contractor shall afford other contractors and Operator every reasonable facility for the execution
of work concurrently with its own work and access to the Drilling location, provided that to do so
will not unduly interfere with or prejudice the Contractor’s operations.



14.10) Business Ethics



Contractor shall not offer or give or agree to give to any person in the services of Operator any
gift or consideration of any kind as an inducement or reward for doing or forbearing to do or for
having done or forborne to do any act in relation to the obtaining or execution of this Contract or
any other contract for Operator or for showing or forbearing to show favour or disfavour to any
person in relation to this Contract or any other contract with Operator.



14.11) Arbitration



All disputes arising out of or in connection with the present contract shall be determined by
arbitration in London, England in accordance with the provisions of the UK’s Arbitration Act 1996.
Disputes hereunder shall be resolved by a sole arbitrator




	 	 	 
	 
	 
	 	 
	

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agreed upon by the Parties. Should the
Parties fail to agree upon a sole arbitrator, then disputes hereunder shall be determined by three
arbitrators, one arbitrator being appointed by each Party and the third arbitrator, who will act as
Chairman, to be appointed by the arbitrators appointed by the Parties. Provided always that
nothing herein shall prevent the Parties from commencing proceedings ancillary to arbitration for
the purpose of obtaining security in respect of claims pursued hereunder.



14.12) GOVERNING LAW



THE PARTIES TO THIS CONTRACT AGREE THAT THE VALIDITY, CONSTRUCTION, ENFORCEMENT AND INTERPRETATION
OF THIS CONTRACT SHALL BE GOVERNED AND CONTROLLED BY THE SUBSTANTIVE LAWS OF ENGLAND, EXCLUDING ITS
CONFLICTS LAWS OR CHOICE OF LAW PROVISIONS.



14.14) No Use of Operator Information to Compete



Contractor acknowledges that the Operator’s Information is valuable to Operator and, therefore, its
protection and maintenance constitutes a legitimate interest to be protected by Operator by the
following covenant not to compete. During the term of this Contract and for two years thereafter
Contractor will not use Operator’s Information obtained by Contractor through its Services under
this Contract to compete with, or usurp business opportunities of, the Operator (or assist others
in doing so), within the Republic of Georgia, regarding oil and gas exploration, production,
geophysical or geotechnical work, seismic exploration, geophysical consulting, prospect
development, prospect promotion, or design, sale, fabrication, assembly, or operation of pipelines,
refineries or facilities to extract, produce, treat, manufacture, transport, store, or refine oil
or gas (the “Operator Opportunities”). Contractor further covenants that during the term of this
Contract and for a period of five (5) years thereafter it will not participate in the equity of, or
take an equity interest in any Operator Opportunities. The foregoing shall not prohibit Contractor
from performing the services for other parties within the Republic of Georgia so long as Contractor
abides by such undertakings. The Parties agree that these limitations are reasonable as to
duration, scope, and geographic coverage.



14.15) Severability



In case one or more of the provisions contained in this Contract shall be determined to be invalid,
illegal, or unenforceable in any respect, the validity, legality, and enforceability of the
remaining provision contained in this Contract shall not in any way be affected or impaired by such
determination, unless such invalidity, illegality or unenforceability diminishes the rights and
obligations, taken as a whole, of the Parties.



14.16) Amendments



This Contract may be altered, modified, amended, or repealed, only by the mutual




	 	 	 
	 
	 
	 	 
	

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written agreement of the Parties.



14.17) Construction of Ambiguity.



The Parties agree and acknowledge that the Contract has been jointly negotiated and drafted and
expresses the mutual intent of the Parties. Accordingly, the rule of
construction against the drafting Party, whichever it may be, in the event an ambiguity exists with
regard to the interpretation of any particular provision of this Contract shall have no application
to this Contract.



14.18) Succession



This Contract shall be binding upon and inure to the benefit of the Parties and, subject to the
terms of this Contract, their respective successors and permitted assigns.



IN WITNESS WHEREOF, the duly authorised representatives of the Parties have executed this Contract
in two originals the date shown below.




	 	 	 	 	 	 	 	 	 	 	 
	NINOTSMINDA OIL COMPANY LTD	 	SAIPEM S.P.A.
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	By:	 	 	 	 	 	 
	

	 	

	 	 	 	
	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Name: Nikoloz Tevzadze	 	Name: Fabio Rondini
	 
	 	 	 	 	 	 	 	 	 	 
	Title: Company representative	 	Title: Business Unit Drilling
	 	 	 	 	Operations Group Commercial
	 	 	 	 	Coordination Manager
	 
	 	 	 	 	 	 	 	 	 	 
	Date:

	 	 	 	Date:	 	 	 	 	 	 
	

	 	

	 	 	 	
	 	 	 	 






	 	 	 
	 
	 
	 	 
	

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APPENDICES




	 	 	 
	APPENDIX A:

	 	DRILLING UNIT (TECHNICAL APPENDIX)
	 
	 	 
	APPENDIX B:

	 	COMPENSATION (RATES)
	 
	 	 
	APPENDIX C:

	 	CONTRACTOR’S AND OPERATOR’S ITEMS AND RESPONSIBILITIES
	 
	 	 
	APPENDIX D:

	 	CONTRACTOR’S PERSONNEL
	 
	 	 
	APPENDIX E:

	 	PRE-SPUD INSPECTION: COMMISSIONING AND ACCEPTANCE TESTS
	

	 	PRIOR TO COMMENCEMENT
	 
	 	 
	APPENDIX F:

	 	PAYMENT GUARANTEE






	 	 	 
	 
	 
	 	 
	

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APPENDIX A




DRILLING UNIT ( TECHNICAL ANNEX )




	 	 	 
	 





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A       RIG GENERAL DATA




	 	 	 	 	 	 	 	 	 
	 	1

	 	 	Rig name
	 	 	Ideco E-2100 Az. 5827	 
	 	2

	 	 	Trailer mounted (preferred) or conventional rig
	 	 	Convetional Rig.	 
	 	3

	 	 	SCR or D/E
	 	 	 SCR	 
	 	4

	 	 	Rig year of construction or assembly
	 	 	 1981 (REBUILT 1991)	 
	 	5

	 	 	Truck trips required to move the rig between locations
	 	 	 90	 
	 	6

	 	 	Estimated rig up time (days)
	 	 	 7 	 
	 	7

	 	 	Estimated rig down time (days)
	 	 	 5 	 
	 	8

	 	 	Heaviest load, widest load, & longest during rig moves
	 	 	Drawworks 44mt Tons / Mud Pit # 1 3.5MT wide / Sub base fillers 14.30 mt long	 
	 	9

	 	 	Actual current rig status (drilling-idle — etc) & location
	 	 	Stacked ASTRAKAN	 
	 	10

	 	 	Average fuel consumption for normal rig operations
	 	 	 7 m3 of diesel per day for rig and camp.	 
	 





B      DRAWINGS




	 	 	 	 	 	 	 	 	 
	 	1

	 	 	Rig general lay-out schematic (location schematic)
	 	 	 5827 1A1	 
	 	2

	 	 	Rig civil engineer layout schematic
	 	 	5827 1B1 - 1C1	 
	 	3

	 	 	Power plant, SCR/DC Motors
	 	 	5827 3A1 - 3B1	 
	 	4

	 	 	Circulating system, including high/low pressure, solids control equipment, transfer pumps, etc.
	 	 	5827 4A1 - 4B1 - 4C1	 
	 	5

	 	 	BOP configuration schematic, including control panels
	 	 	5827 5A1 - 5A2 - 5D1 - 5E1	 
	 	6

	 	 	Choke manifold lay-out drawing including connecting lines to BOP, to mud gas-separator, to rig floor
and to Cementing unit area
	 	 	5827 4B1 - 5B1	 
	 	7

	 	 	Accommodation Camp layout
	 	 	5827 1C1	 
	 





C      MAST, SUBSTRUCTURE, DRAWWORKS & ASSOCIATED EQUIPMENT




C1     MAST & ASSOCIATED EQUIPMENT




	 	 	 
	 





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	 	1

	 	 	Mast (make-type), built per API 4-F
	 	 	Pyramid
142' Cantilever Mast, triple
stands — 1,100,000 pounds static hook
load capacity built in accordance with
API 4-E.	 
	 	2

	 	 	Racking platform capacity of 5" DP
	 	 	 23,300 ft.	 
	 	3

	 	 	Racking platform capacity of D.C.
	 	 	540 ft 9.1/2" + 540 ft of 6 1/2" D.C.	 
	 	4

	 	 	Racking platform range DP & DC
	 	 	3
1/2"-5" DP and 3 1/8" - 9.1/2" DCs.	 
	 	5

	 	 	Derrick complete with monkey, stabbing, and belly boards, safety cages around ladders(or climbing
device), and derrick escape line, derrick climbing assist line
	 	 	Mast complete with monkey / stabbing and
belly board, safety cages around ladders,
Geronimo derrick escape line and Derrick
climbing assist line with counter weight.	 
	 





C2     SUBSTRUCTURE, FLOOR, AND RIG FLOOR EQUIPMENT




	 	 	 	 	 	 	 	 	 
	 	1

	 	 	Substructure (make-type), built per API 4-F
	 	 	Pyramid Self Erecting Built as per API 4E.	 
	 	2

	 	 	Minimum rated setback load capacity
	 	 	 600,000 lbs.	 
	 	3

	 	 	Minimum rated rotary load capacity
	 	 	1,000,000 lbs.	 
	 	4

	 	 	Minimum simultaneous capacity of setback and rotary
	 	 	600,000+1,000,000	 
	 	5

	 	 	Rig floor dimensions
	 	 	11.27
m  ́  9.9 m	 
	 	6

	 	 	Rig floor height from ground level
	 	 	9.15 m	 
	 	7

	 	 	Clear height between Rotary beams and ground level
	 	 	8.07 m	 
	 	8

	 	 	Rig floor drainage system discharging into flowline or waste pit.
	 	 	Yes.	 
	 	9

	 	 	Rotary Table drainage system discharging into bell nipple.
	 	 	Yes.	 
	 	10

	 	 	Rotary Table
	 	 	One each: 1,000,000 lbs rated capacity,
Ideco 37 1/2" opening, driven by
drawworks, MPCH split type complete with
appropriate master bushing with 1-2-3
insert bowl & kelly drive bushings	 
	 	11

	 	 	Rotary Table anti-slipping pad
	 	 	Custom safety pad II.	 
	 





	 	 	 
	 





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NINOTSMINDA OIL COMPANY LTD







	 	 	 	 	 	 	 	 	 
	 	12

	 	 	Top Drive System
	 	 	One Varco IDS 1 rated at 1,000,000
pounds, electric driven system 1,000 HP,
0-200 RPM for DP size 3.1/2" - 5", 36,000
ft-lbs, complete with Siemens C700 video
camera	 
	 	13

	 	 	Not Used	 	 	 	 
	 	14

	 	 	Spinning Wrench
	 	 	Weatherford - 13000 J29 for 2.7/8" to 7"
air powered.	 
	 	15

	 	 	Winches on rig floor
	 	 	Two Ingersoll Rand - K4UL/AB - air
operated - 8,000 lbs - complete with
safety guard and automatic brakes.	 
	 





C3     BLOCKS & SWIVEL ASSEMBLY




          General Requirements



	 	 	 	 	 	 	 	 	 
	 	1

	 	 	Crown block make & type, built per API 8-C PLS-1 (excluding Appendix A, SR2: Specifications for
temperatures below -20C)
	 	 	Pyramid, built as per API 8A, Rated load
capacity 1,000,000 lb - 7  ́ 60" Sheaves -
1.3/8" wire line.	 
	 	2

	 	 	Travelling block make & type, built per API 8-C PLS-1(excluding Appendix A, SR2: Specifications for
temperatures below -20C)
	 	 	Varco Integrated Traveling Block, Built
as per API 8A, Rated load capacity
1,000,000 lb - 6  ́ 52" Sheaves - 1.3/8"
wire line.	 
	 	3

	 	 	Hook block (make-type), built per API 8-C PLS-1(excluding Appendix A, SR2: Specifications for
temperatures below -20C)
	 	 	Varco BJ 500 ton Built as per API 8A .	 
	 	4

	 	 	Not used	 	 	 	 
	 





C4     DRAWWORKS ASSEMBLY




	 	 	 	 	 	 	 	 	 
	 	1

	 	 	Drawworks make & model; mechanical driven
	 	 	Ideco E-2100 drawworks, lebus grooved
for 1.3/8" wire line.	 
	 	2

	 	 	Drawworks rated input power
	 	 	2,000 HP	 
	 	3

	 	 	Dawworks actual input power
	 	 	2,000 HP	 
	 	4

	 	 	Not Used	 	 	 	 
	 





	 	 	 
	 





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NINOTSMINDA OIL COMPANY LTD







	 	 	 	 	 	 	 	 	 
	 	5

	 	 	Low speed drum clutch
	 	 	Airflex 42VC1200 drum clutch - rated pull
capacity 80,000 lbs at 120 psi.	 
	 	6

	 	 	Drawworks main & auxiliary brakes
	 	 	Main drum brake band type. Auxiliary
brake Elmagco 7040 - rated capacity
84,000 lbs at 50 RPM.	 
	 	7

	 	 	Make-up & break-out catheads or hydraulic equivalents
	 	 	Make up cathead -FOSTER 37 max line pull
13.000 lbs- & break out cathead -FOSTER
24 AH- max line pull 28.000 lbs	 
	 	8

	 	 	Crown block safety device
	 	 	Koomey TCB (crown -O- matic) and Bentec
ACS crown block & rig floor safety device
protection complete with audible and
visual alarms at driller’s site.	 
	 	9

	 	 	Fast line guide
	 	 	Wireline turnback.	 
	 	10

	 	 	Drilling line
	 	 	1.3/8" 6 ́19 IPS - IWRC 175,000 lbs API
breaking strength - 750,000 lbs hookload
with safety factor of 2.0	 
	 	11

	 	 	Dead Line Anchor
	 	 	National EB. Located on the substructure
75,000 lbs single line capacity complete
with E80 hydraulic load cell Built as per
API 8A	 
	 





C5     DRAWWORKS ELECTRIC MOTORS





	 	 	 	 	 	 	 	 	 
	 	1

	 	 	Drawworks motors
	 	 	No. 2 General Electric motors GE752, 1,000 Hp each, forced air cooling system.	 
	 





C6     BOP HANDLING SYSTEM UNDER SUBSTRUCTURE




	 	 	 	 	 	 	 	 	 
	 	1

	 	 	BOP handling system ; Power — remote operated (make)
	 	 	General Hydraulic: Rated hoist capacity
88,000 lbs, Max vertical traveling stroke
1m, Max horizontal traveling stroke 4m.	 
	 





D      CIRCULATING SYSTEM




	 	 	 
	 





page 32 of 72









 





NINOTSMINDA OIL COMPANY LTD







D1     MUD PUMPS




	 	 	 	 	 	 	 	 	 
	 	1

	 	 	Mud pump Make & Model
	 	 	Two National 12P160 triplex mud pumps
rated at 1600 hp, complete with 6.1/2" -
6" - 5.1/2" liners.	 
	 	2

	 	 	Mud Pump Performance Requirements:
	 	 	High flow rate application: 517 gpm
(100% efficiency) @ 100 spm @ 3980 psi
rated discharge pressure with 6.1/2"
liner; High pressure applications: 370
gpm (100% efficiency) @ 100 spm @ 5000
psi rated discharge pressure with 5.1/2"
liner.	 
	 	3

	 	 	Mud pumps complete with pulsation dampeners, relief valves, stroke counters & liner sizes necessary
to meet above performance requirements
	 	 	Mud pumps have Hydril Pulsation Dampener
K20 with a relief valve Cameron B 3"
equipped with Weco union fig.1502, liner
size available 6.1/2", 6" & 5.1/2". Each
pump is equipped with stroke counter.	 
	 	4

	 	 	Mud pump electric motors
	 	 	Each pump is equipped with No. 2 GE 752
electric motors - 800 HP each.	 
	 	5

	 	 	Mud pump suction line
	 	 	National horizontal suction dampeners
with filters in suction lines.	 
	 	6

	 	 	Mud pump discharge line
	 	 	Mud pumps discharge lines 3.1/2" ID
Vibrator hoses / 4.1/16" ID rigid lines,
equipped with Hydril K20 pulsation
dampeners and Cameron B 3" relief valves.	 
	 	7

	 	 	Charging pumps
	 	 	Two each Mission pumps 5 ́6, 50 hp
electric motor @ 1250 rpm with a impeller
diameter of 13"	 
	 





D2     RIG FLOOR MUD MANIFOLD




	 	 	 
	 





page 33 of 72









 





NINOTSMINDA OIL COMPANY LTD







	 	 	 	 	 	 	 	 	 
	 	1

	 	 	Rig Floor Mud manifold
	 	 	Rig floor mud manifold with No. 5  ́ 5"
welded valves, No.7  ́ 2" Threaded valves
No. 1  ́ 1.1/16" 5,000psi Cameron H2 bleed
off valve.
(See Dwg.
5827 5H1).	 
	 	2

	 	 	Cementing lines
	 	 	Two each, from cement unit area to rig
floor, 3" ID, 10M, rigid steel	 
	 	3

	 	 	Mud manifold stand pipe
	 	 	Two
each rigid section - 4.1/16"ID 5,000
psi WP - Two each flexible section -
3.1/2"ID 5,000 psi WP - Built as per API
7K grade D.	 
	 	4

	 	 	Rotary Hose
	 	 	Two
each - 3.1/2" ID  ́ 75' length - 5,000
psi WP - Built as per API 7K grade D.	 
	 





D3     MUD TANK SYSTEM



	 	 	 	 	 	 	 	 	 
	 	 

	 	 	General requirements:	 	 	 	 
	 	 

	 	 	1)  All mud tanks must be covered
	 	 	Yes.	 
	 	 

	 	 	2)  All mud tanks must be equipped with heating steam lines
	 	 	Yes	 
	 	 	3)  Total system volume (active and reserve)
	 	 	
2130 bbls total nominal volume.
	 	 	 	 
	 	Mud tank nr. 1 (65 m3) with 3 section, nr. 1 centrifugal pump 6  ́ 8 – 75 HP for cellar ejector, trip
tank refilling or De gasser feed or super charging.

On top there is a frame with one double scalping unit Brandt Dual tandem in cascade onto
three linear motion Derrick FLC 48. One section below shale shaker is sloped for sand
trap
	 	 
	 	-     Mud tank nr. 2 (65 m3) with two section and one mud agitator. Equipped with 1 centrifugal
pump 6  ́ 8 – 75 HP for De gasser feed or other use (all suction or discharge are manifold, so the
centrifugal permit maximum flexibility).
	 	 
	 	-     Mud tank nr. 3 (75 m3) with two sections, 20 m3 for slug tank and remaining for suction. Three
mud agitator, 2 centrifugal pump 5  ́ 6 – 50 HP for super
charging.


Lines are distribute to permit to mix in the two sections independently
	 	 
	 	-     Mud tank nr. 4 and 5 (75 m3 each) one section each for mixing or storage of mud with two
suction and two discharging lines independent to allow different use of mixing unit through
	 	 
	 





	 	 	 
	 






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	 	NINOTSMINDA OIL COMPANY LTD





	 	 	 	 	 	 	 	 	 
	 	 	 	 	other mud tank

-  Nr. 1 mixing unit with two 6 ́ 8 - 100 HP centrifugal pump and two hopper Vortex
Ventures low pressure shear device for mixing, transfer or super charging.

	 	 	 	 
	 	1

	 	 	Mud tank: Shaker tank and shaker
	 	 	One each 190 bbls capacity (one section of first mud
tank), complete with one doubleBrandt dual tandem
cascading onto two Derrick flo-line cleaner plus
single shale shakers, sand trap and one bottom gun.	 
	 	2

	 	 	Mud tank: Active
	 	 	500 bbls total capacity (second section of second
mud tank plus suction tank) complete with electric
agitator and bottom gun in all compartment.	 
	 	3

	 	 	Mud tank: Treatment
	 	 	280 bbls capacity (one section of second mud tank)
complete with one electric agitator and one bottom
gun.	 
	 	4

	 	 	Mud tank: Reserve
	 	 	One each 470 bbls capacity complete with two
electric agitators and two bottom guns.	 
	 	5

	 	 	Trip tank
	 	 	One each 20 bbls capacity, complete with electric
feed pump and electronic trip tank indicator, showed
at driller’s site.	 
	 	6

	 	 	Mud slug pit
	 	 	One each 100 bbls capacity (one section of suction
mud tank), complete with one electric agitator and
one bottom gun.	 
	 	7

	 	 	Drilling water reserve tank
	 	 	Three 470 bbls capacity each complete with tie in to
active system and appropriate transfer pumps.	 
	 	8

	 	 	Mud mixing system
	 	 	Two each Mission 6 ́8 pumps with 75 hp AC motor 1750
rpm, complete with two standard mud hoppers.	 
	 





	 	 	 
	 





page 35 of 72







 




NINOTSMINDA OIL COMPANY LTD







	 	 	 	 	 	 	 	 	 
	 	9

	 	 	Mud degasser unit (vacuum type)
	 	 	One Swaco standard Toga H2S service 800 gpm minimum
input capacity with 6" OD discharge line.	 
	 	10

	 	 	Mud/gas separator, “atmospheric” type vertical separator
	 	 	Included in the above system.	 
	 	11

	 	 	Mud return system
	 	 	Bell nipples for each size BOP, 12" round enclosed
flowline	 
	 





E      RIG POWER & ELECTRICAL SYSTEMS




E1      S.C.R. CONVERSION SYSTEM




									
	 	1

	 	 	S.C.R. system (if applicable)
	 	 	4 (four) cubicles Ross Hill “1400”, Input 600 V AC
- 1000 A, 750V DC Output, for shunt motors.
The SCR can be
able to run Seven DC motors simultaneously.	 
	 	2

	 	 	Primary power
	 	 	Sufficient to supply power to two mud pumps and top
drive under full load plus draw-works under 50% load
and utilities. No.4 diesel engine 1200 HP each. Total
continuos power 4800 HP. Manufacture by Caterpillar
type D399.	 
	 





E2       POWER PLANT-BACKUP POWER




									
	 	 	 	 	 	 	 	Yes.	 
	 	1

	 	 	Diesel Engine/Generator sets
	 	 	No.1 diesel engine 230 HP Type VM 1312 rated 160 Kw
with automatic starter and connections to: emergency
light system, one mix- circulating pump, one air
compressor, Koomey electrical recharging pump,
offices and communication equipment.	 
	 





E3       ELECTRICAL LIGHTING SYSTEM




			
	
	 	 
	 





page 36 of 72









 




NINOTSMINDA OIL COMPANY LTD







	 	 	 	 	 	 	 	 	 
	 	1

	 	 	Fixed lighting system
	 	 	Minimum of 30 lux in each zone and explosion proof
equipment where necessary.	 
	 	2

	 	 	Portable floodlights
	 	 	No. 3 – 400 W each EEX-d.	 
	 





E4       ELECTRICAL SAFETY DEVICES




									
	 	1

	 	 	Emergency shut down button - diesel engines
	 	 	Emergency shut down bottons located on rig floor and
S.C.R.	 
	 	2

	 	 	Emergency shut down button for A.C. users
	 	 	Emergency shut down button for D.C. motors.	 
	 	3

	 	 	Explosion proof electric equipment located into Hazardous areas certified to any
international regulations
	 	 	Confirmed. All equipment installed in open areas to
be weather proof, at least IP54.	 
	 





F       WELL CONTROL EQUIPMENT




	 	 	 
	

	 	1) All BOP & well control equipment listed in

section F will be rated for H2S service






F1       BOP STACK REQUIREMENTS: 21 1/4" DIVERTER SYSTEM




									
	 	1

	 	 	Annular Preventer
	 	 	Hydril MSP or Shaffer spherical 21.1/4" 2,000,
flanged 20.3/4" 3K psi, built as per API 6A.	 
	 	2

	 	 	Diverter Spool
	 	 	One 20.3/4" 3,000 psi diverter spool, complete with
2 Each 4 1/16" 3M pump in ports with 4 1/16" valves,
2 Each 10" diverter outlets, 2 Each 10" air actuated
diverter valves, 2 Each 10" Gate Valves, 700' of 10"
flanged diverter line.	 
	 





F2        BOP STACK REQUIREMENTS: 13 5/8" NOMINAL




			
	
	 	 
	 





page 37 of 72









 





NINOTSMINDA OIL COMPANY LTD







	 	 	 	 	 	 	 	 	 
	 	1

	 	 	Annular Preventer
	 	 	One Hydril GK 13.5/8" - 5,000 psi WP annular blowout
preventer top studded 13.5/8" 5,000 (BX-160 ring
groove), bottom flanged 13.5/8" - 10,000 psi,
(BX-159 ring groove). Built as per API 6A.	 
	 	2

	 	 	Single ram preventer
	 	 	One Cameron type U 13.5/8" - 10,000 psi WP, single
ram preventer top and bottom flanged (BX-159 rig
grooves), with one 4.1/16" - 10,000 and one 2.1/16"
10,000 flanged side outlets. Built as per API 6".	 
	 	3

	 	 	Double ram preventer
	 	 	One Cameron type U 13.5/8" - 10,000 psi WP, double
ram preventer top and bottom flanged (BX-159 rig
grooves), with two each 4.1/16" - 10,000 and two
each 2.1/16" 10,000 flanged side outlets. Built as
per API 6A.	 
	 	4

	 	 	Rams for above preventers
	 	 	One set each of the following rams:blind/shear;
variable 2.7/8" - 5"; flexpacker 2.3/8" - 3.1/2";
9.5/8" pipe; 7" pipe; 2.7/8" pipe; 2.3/8" pipe.
Two sets each
for 5" and 3,1/2" pipe. Shear rams will shear DP 5"
G-105 25.6# with 2.800 p.s.i operating pressure.	 
	 	5

	 	 	Adapter spools
	 	 	One each 13.5/8" 10,000 psi  ́ 11" 10,000 flanged or
studded.	 
	 	6

	 	 	Adapter Spools
	 	 	One each 13.5/8" 10,000 psi  ́ 9" 10,000 flanged or
studded.	 
	 





F3        CHOKE & KILL VALVES ON BOP STACKS




	 	1

	 	 	Hydraulic choke valves
	 	 	Two each hydraulic valve Cameron F 4.1/16" - 10,000
psi flanged. Built as per API 6A.	 
	 





			
	
	 	 
	 





page 38 of 72









 





NINOTSMINDA OIL COMPANY LTD







	 	 	 	 	 	 	 	 	 
	 	2

	 	 	Manual choke valves
	 	 	Two each manual valve Cameron F 4.1/16" - 10,000
psi, flanged. Built as per API 6A.	 
	 	3

	 	 	Hydraulic kill valves
	 	 	Two each hydraulic valve Cameron F 2.1/16" - 10,000
psi flanged. Built as per API 6A.	 
	 	4

	 	 	Manual kill valves
	 	 	Two each manual valve Cameron F 2.1/16" - 10,000
psi, flanged. Built as per API 6A.	 
	 





F4
       KILL AND CHOKE LINES


									
	 	1

	 	 	Kill line from BOP stack to rig floor mud manifold, per API 16C
	 	 	One - 2" nominal - 5,000 psi rigid steel (see dwg.
5827 4B1).	 
	 	2

	 	 	Kill line from BOP stack to cementing unit area, per API 16C
	 	 	One 2" Weco fig.1502 union ready for cementing unit
connection on 2.1/16" 10,000 kill manifold (see dwg.
5827 4B1).	 
	 	3

	 	 	Choke line from BOP stack to choke manifold, per API 16C
	 	 	Two each rigid steel, 4.1/16" - 10,000 psi WP.	 
	 





F5        CHOKE MANIFOLD




	 	 	 	 	 	 	 	 	 
	 	1

	 	 	Choke Manifold High pressure section
	 	 	3 1/16 -10 M psi	 
	 	2

	 	 	Choke Manifold Low pressure section
	 	 	3.1/8" - 5,000 psi	 
	 	3

	 	 	Choke Manifold inlet points
	 	 	Two	 
	 	4

	 	 	Choke Manifold manual choke valve
	 	 	Two Cameron H2 - 3.1/16" 10,000 psi	 
	 	5

	 	 	Choke Manifold Power choke valve
	 	 	One Cameron HDC - 3.1/16" 10,000 psi	 
	 	6

	 	 	Choke Manifold Hydraulic operated isolation valve
	 	 	Three each 3.1/16" 10,000 psi with hydraulic motor
and manual override.	 
	 	7

	 	 	Hydraulic valve control panel
	 	 	One hydraulic control panel installed near choke
manifold.	 
	 	8

	 	 	Choke Manifold manual operated isolation valve
	 	 	See drawing No. 5827 5B1.	 
	 





			
	
	 	 
	 





page 39 of 72









 





NINOTSMINDA OIL COMPANY LTD







	 	 	 	 	 	 	 	 	 
	 	9

	 	 	Choke Manifold connection provision for mud logging pressure sensor complete with
isolation valve
	 	 	One Cameron 2.1/16" 10,000 psi with companion flange
2.1/16" 10,000 psi  ́ 2" L.P.	 
	 	10

	 	 	Glycol injection with isolation valve
	 	 	One injection valve	 
	 	11

	 	 	Choke Manifold Gauges for Drill Pipe & Casing pressure
	 	 	One each Vernier gauge for drill pipe & casing
pressure installed on power choke control panel.	 
	 	12

	 	 	Choke Manifold outlet points
	 	 	Three 4.1/8" 5,000 psi	 
	 	13

	 	 	Choke Manifold outlet line running to mud gas separator
	 	 	One steel rigid / flexible.	 
	 	14

	 	 	Choke Manifold outlet line running to shale shaker
	 	 	Steel rigid / flexible.	 
	 	15

	 	 	Choke Manifold outlet running to flare line
	 	 	One outlet running in two flare line by 120 degree Y.	 
	 	16

	 	 	Flare line
	 	 	Steel rigid 3" - 330 ft (each line) from well to
flare, with 120 degree “Y” & 2 valves complete with
lockouts to allow access to 2 flare pits.	 
	 	17

	 	 	Choke Manifold power choke control panel
	 	 	One Cameron hydraulic control panel complete with
pump stroke counter & totalizer power choke opening
indicator, Vernier pressure gauges for SP & casing
pressures. Installed in driller dog house.	 
	 	18

	 	 	Reverse circulating line from Rig Floor to Choke Manifold
	 	 	One each 2.1/16" ID - 10,000 psi flanged suitable
for H2S service, complete with pressure gauge.	 
	 	19

	 	 	Choke Manifold skid complete with adjustable hydraulic operated system to align the
Choke Manifold with choke lines
	 	 	As per Operator request.	 
	 





F6        BOP CONTROL SYSTEM




	 	 	 
	

	 	System quoted below will close / open / close all
BOP components and have 1200 p.s.i remaining
accumulator pressure
	 
	 	 
	

	 	The electrical power to the pumps will be tied to
both the main and emergency generators.






			
	
	 	 
	 





page 40 of 72









 





NINOTSMINDA OIL COMPANY LTD







	 	 	 	 	 	 	 	 	 
	 	1

	 	 	Accumulator Unit (make-type)
	 	 	Koomey T20-240-3S - 24 bottles - 315 gals 3,000 psi
WP No. 1 electrical recharging triplex pump Koomey
T315-20-3 with flow rate of 8,7 gpm and No. 2 50:1
air driven recharging pumps with flow rate of 3.6
gpm each.	 
	 	2

	 	 	Accumulator Unit control manifold
	 	 	Koomey GU-2KB-9S, with No. 9 four way Barksdale
control valve, complete with low/high pressure
by-pass valve.	 
	 	3

	 	 	Not used	 	 	 	 
	 	4

	 	 	Accumulator Unit pressure regulators
	 	 	One KR pneumatic pressure regulator
One KR manual pressure
manifold regulator.	 
	 	5

	 	 	Accumulator Unit pumps
	 	 	No. 2
Koomey 50:1 type - 3,6 gal/min each - 3,000
psi with 140 psi air supplying pressure. No. 1
electrical recharging triplex pump Koomey T315-20-3
with flow rate of 8.7 gpm.	 
	 	6

	 	 	Accumulator Unit control panels
	 	 	One Koomey GBK9A driller control panel air operated
with graphic BOP configuration, annular regulator,
by-pass and lights for activated functions complete
of audio and visual alarms.( Tool Pusher office will
be within 100' from accumulator unit )	 
	 	7

	 	 	Control hoses from Accumulator Unit to BOP stack
	 	 	8
(eight) 1" ID + 8 (eight) 1/2" ID flexible control
hoses fire resistant only for last section.	 
	 





F7        DRILL STRING SAFETY EQUIPMENT




	 	 	 	 	 	 	 	 	 
	 	1

	 	 	Not used	 	 	 	 
	 	2

	 	 	Not used	 	 	 	 
	 	3

	 	 	Lower Kelly cocks
	 	 	Two Hydril or equivalent, type Kelly guard 10,000
psi WP 6.5/8" OD - 2.13/16" ID NC50 connections.	 
	 





			
	
	 	 
	 





page 41 of 72









 






NINOTSMINDA OIL COMPANY LTD







	 	 	 	 	 	 	 	 	 
	 	4

	 	 	Not used	 	 	 	 
	 	5

	 	 	Not used	 	 	 	 
	 	6

	 	 	Lower Kelly cocks location
	 	 	Rig Floor.	 
	 	7

	 	 	D.P. circulating head
	 	 	One each, 5" DP, Low torque, 2" 10M, 2" Weco 1502
top connection, NC-50 pin down.	 
	 	8

	 	 	Not used	 	 	 	 
	 	9

	 	 	Not used	 	 	 	 
	 	10

	 	 	Inside BOP valve
	 	 	One Gray inside BOP float valve, 10,000 psi WP NC50
connections.	 
	 	11

	 	 	Inside BOP valve
	 	 	One Gray inside BOP float valve, 10,000 psi WP NC38
connections.	 
	 	12

	 	 	Not used	 	 	 	 
	 	13

	 	 	Drop-in valve & landing sub
	 	 	Hydril or equivalent Drop-in valve retrievable type: One for 5" DP and One for 3.1/2" DP complete with
two landing subs each.	 
	 	14

	 	 	Not used	 	 	 	 
	 





F8        MISCELLANEOUS WELL CONTROL MATERIAL




	 	 	 	 	 	 	 	 	 
	 	1

	 	 	Chicksan joints
	 	 	10
(ten) FMC or ANSON 10,000 psi WP H2S service 2"
 ́
12' with Weco fig.1502 connections.	 
	 	2

	 	 	Casing Cup testers
	 	 	One Cameron F - 13.3/8" 68 to 72 lb.ft	 
	 	3

	 	 	Casing Cup testers
	 	 	One Cameron F (only cup) 9.5/8" 43.5 to 53.5 lb.ft	 
	 	4

	 	 	Casing Cup testers
	 	 	One
Cameron F - 7" 29 to 38 lb.ft	 
	 	5

	 	 	Not Used	 	 	 	 
	 	6

	 	 	Cross-Over to test lower Kelly cock
	 	 	One NC50  ́ 2" Weco fig.1502	 
	 	7

	 	 	Cross-Over to test lower Kelly cock
	 	 	One NC38  ́ 2" Weco fig.1502	 
	 	8

	 	 	BOP test pump
	 	 	One General Control 10,000 psi WP completed with
circular chart recorder.	 
	 





			
	
	 	 
	 





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NINOTSMINDA OIL COMPANY LTD







G        DOWN HOLE TUBULAR EQUIPMENT & RELATED HANDLING TOOLS




	 	 	 
	

	 	1) All drill pipe & drill collars will be supplied
according to API specification RP 7 (minimum
premium)
	

	 	2) Drill pipe will be complete with thread protectors
	

	 	3) Crossovers will meet Drill Pipe Requirements of
API.7






G1        Kellys, Drill Pipe, Collars, Crossovers




	 	 	 	 	 	 	 	 	 
	 	1

	 	 	Not Used	 	 	 	 
	 	2

	 	 	Not Used	 	 	 	 
	 	3

	 	 	5" DP: 19.5 lb/ft
	 	 	3.500 m. Grade G and 1.500 m Grade S – Premium API
standard	 
	 	4

	 	 	5" DP: 25.6 lb/ft
	 	 	N/A	 
	 	5

	 	 	5" HWDP
	 	 	30 Joint: 5" Heavy Weight Drill pipe +/- 50lb/ft,
complete with centre upset, NC-50 connection.	 
	 	6

	 	 	5", pup joints
	 	 	2 each for 7, 10 and 15 ft long – Grade S	 
	 	7

	 	 	3 1/2" DP 15,5 lb/ft
	 	 	2.500 m. Grade G – Premium API standard	 
	 	8

	 	 	3 1/2 pup joints
	 	 	2 each for 7, 10 and 15 ft long – Grade S	 
	 	9

	 	 	3 1/2" HW
	 	 	30 Joint: 3.1/2" Heavy Weight Drill pipe +/- 24
lb/ft, complete with centre upset, NC-38 connection.	 
	 	10

	 	 	Not Used	 	 	 	 
	 	11

	 	 	Not Used	 	 	 	 
	 	12

	 	 	Not Used	 	 	 	 
	 	13

	 	 	Not Used	 	 	 	 
	 	14

	 	 	Drill Collars: 9 1/2"
	 	 	9 (nine) 9.1/2" ́  3", 31' long, spiral cut complete
with body recess for slips, connection 7 5/8 reg	 
	 	15

	 	 	Drill Collars: 8 1/4"
	 	 	24 (twenty four ) 8.1/4"  ́ 2.13/16", 31' long,
spiral cut, complete with body recess for slips, API
6 5/8 reg connections.	 
	 





			
	
	 	 
	 





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	 	16

	 	 	Not Used	 	 	 	 
	 	17

	 	 	Drill Collars: 6 3/4"
	 	 	30
(thirty) 6.1/2"  ́
2.1/4", 31' long, spiral cut,
complete with body recess for slips, API NC-46
connections.	 
	 	18

	 	 	Drill collars : 4 3/4"
	 	 	20 (twenty) 4 3/4 DC slick 31 ft long API 3 1/2 IF	 
	 	19

	 	 	Not Used	 	 	 	 
	 	20

	 	 	Drill
Collar Pup Joints, 10' long; Identical specifications as above DCs
	 	 	2 for each size of DC – 10 ft long	 
	 	21

	 	 	Cross-over
	 	 	2 each size to run in hole all Contactor’s tubular
materials	 
	 	22

	 	 	Bit Subs. For all bit sizes between 4 1/8" & 26" & necessary x-over to get back to
above drill collars
	 	 	Two each size bored for & including floats	 
	 	23

	 	 	Core Barrels
	 	 	Christensen
P250 6 3/4 “ ́ 4” ( coreheads and
fiberglass inner barrels are not provided )	 
	 





G2
       D.P. - D.C. HANDLING TOOLS




	 	 	 	 	 	 	 	 	 
	 	1

	 	 	Not Used	 	 	 	 
	 	2

	 	 	Links Elevators
	 	 	One set 2.1/4"  ́ 132" 250 ton	 
	 	3

	 	 	Links Elevators
	 	 	One set 2.3/4"  ́ 132", 350 ton	 
	 	3a

	 	 	Links Elevators
	 	 	One set 3.1/2"  ́ 132" 500 ton	 
	 	4

	 	 	Drill pipe Elevators 5"
	 	 	Two each, 5" DP , 350 ton	 
	 	5

	 	 	Drill pipe Elevators 3 1/2"
	 	 	Two each, 3.1/2" DP , 250 ton	 
	 	6

	 	 	Not Used	 	 	 	 
	 	7

	 	 	Drill pipe manual slips 5"
	 	 	Two Each, 5" DP, Varco SDXL	 
	 	8

	 	 	Drill pipe manual slips 3 1/2"
	 	 	Two Each, 3.1/2" DP, Varco SDXL	 
	 	9

	 	 	Not Used	 	 	 	 
	 	10

	 	 	Drill Collar lifting subs Elevators
	 	 	4  ́ 9.1/2", 8  ́ 8.1/4", 10  ́ 6.1/2" and 5  ́ 4./34" DC	 
	 	11

	 	 	Drill Collar manual slips
	 	 	Two each BR type C1 or equivalent for each size DC
provided.	 
	 	12

	 	 	Drill Collar safety clamps
	 	 	Two
BR type “C” 3.3/4" to 10.5/8"	 
	 





			
	
	 	 
	 






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	 	13

	 	 	Drill Collar-D.P. manual rotary tongs
	 	 	One set each of Varco BJ Rotary tong type: C — 2.7/8" to 5.1/4", B — 5" to
13.3/8", SDD — 8" to 12"	 
	 	14

	 	 	Bit breaker
	 	 	One each, 8 1/2", 5 3/4" & 4 1/2"	 
	 	15

	 	 	DC Elevators
	 	 	Not needed – In use lifting subs with DP elevator	 
	 





H CASING, TUBING EQUIPMENT AND FISHING TOOLS




	 	 	 	 	 	 	 	 	 
	 	1

	 	 	20" casing handling tools
	 	 	One each: 20" single joint pickup elevators; one each 20" 150 ton side door
elevators; one each 20" casing slips for use in rotary table; four each 20"
clamp on casing protector	 
	 	2

	 	 	13 3/8" casing handling tools
	 	 	One set of spider/elevator, single joint, side door and slips	 
	 	3

	 	 	9 5/8 casing handling tools
	 	 	One set of slips for spider/elevator, single joint, side door and slips	 
	 	4

	 	 	7" casing handling tools
	 	 	One set of slips for spider/elevator, single joint, side door and slips	 
	 	5

	 	 	5" casing handling tools
	 	 	One set of slips for spider/elevator, single joint, side door and slips	 
	 





     Fishing



	 	 	 	 	 	 	 	 	 
	 	1

	 	 	Junk Baskets (Bowen or equivalent)
	 	 	One (1) each for 12-1/4" hole size 6-5/8" reg	 
	 	2

	 	 	Junk Baskets (Bowen or equivalent)
	 	 	One (1) each for 8-1/2" hole sizes	 
	 	3

	 	 	Reverse circulating junk baskets (Bowen or equivalent)
	 	 	One (1) 11" OD 6-5/8" reg connections	 
	 	4

	 	 	Reverse circulating junk baskets (Bowen or equivalent)
	 	 	One (1) 7-3/4" OD NC-46	 
	 	5

	 	 	Overshots (Bowen or equivalent)
	 	 	One (1) 11-3/4" overshot	 
	 	6

	 	 	Overshots (Bowen or equivalent)
	 	 	One (1) 10-5/8" overshot	 
	 	7

	 	 	Overshots (Bowen or equivalent)
	 	 	One (1) 9-5/8" overshot	 
	 	8

	 	 	Overshots (Bowen or equivalent)
	 	 	One (1) 8-1/8" overshot	 
	 	9

	 	 	Fishing Jars (Bowen or equivalent)
	 	 	One (1) 7-3/4" OD	 
	 





	 	 	 	 	 
	 







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	 	10

	 	 	Fishing Jars (Bowen or equivalent)
	 	 	One (1) 6-1/4" OD	 
	 	11

	 	 	Fishing Jars (Bowen or equivalent)
	 	 	One (1) 4-3/4" OD	 
	 	12

	 	 	Bumper Subs (Bowen or equivalent)
	 	 	One (1) 7-3/4" OD	 
	 	13

	 	 	Bumper Subs (Bowen or equivalent)
	 	 	One (1) 6-1/4" OD	 
	 	14

	 	 	Bumper Subs (Bowen or equivalent)
	 	 	One (1) 4-3/4" OD	 
	 





I RIG INSTRUMENTATION




Graduated as per METRIC system




I1 DRILLER’S CONSOLE INSTRUMENTS




	 	 	 	 	 	 	 	 	 
	 	1

	 	 	Driller’s Console (make-type)
	 	 	Martin Decker console, complete with: Weight indicator M.D. type “E",
hydraulic pressure gauge type GM4-500K range 0-400 bar, electric rotary
torque range 0-2950 ft.lbs / 0-4570 ft.lbs, digital stroke & totalizer
counters, rotary speed indicator 0-250.	 
	 	2

	 	 	Manual Tongs pull indicator
	 	 	Martin Decker H6B-40 hydraulic load cell 0-11,000 Kg capacity.	 
	 	3

	 	 	Digital mud/PVT system
	 	 	Swaco Smart system level II, can be monitoring individual tank and total
system volume, trip tank volume, mud flow, spm for each pump, recording
system and alarms.	 
	 	4

	 	 	Drill Parameters recorder (digital and analogic):
	 	 	Swaco Smart system level II Data Acquisition System, recording all drilling
parameters with monitor in Company office

Martin Decker Record O Graph seven pens recorder for: string weight, ROP,
rotary speed or top drive speed, rotary torque or top drive torque, SPM
pump 1 and pump 2, stand pipe pressure.	 
	 





	 	 	 	 	 
	 







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J SAFETY & FIRE FIGHTING EQUIPMENT




J1 GAS DETECTION SYSTEM




	 	 	 	 	 	 	 	 	 
	 	1

	 	 	H2S & combustible gas monitoring fixed installations

(make, type, control panels, etc)
	 	 	SES gas detection system for H2S and CH4. The system shall give visible and
audible warning at the driller’s stand	 
	 	2

	 	 	H2S & combustible gas monitoring sensors
	 	 	Eight point of fixed gas sensor sites in: shale shaker, flow line, bell
nipple, rig floor, cellar, mud pits & choke manifold.	 
	 





J2 PORTABLE MONITORING INSTRUMENTATION




	 	 	 	 	 	 	 	 	 
	 	1

	 	 	Portable H2S, O2, and Combustible gas detectors
	 	 	Three MSA Passport complete with kit for calibration suitable for all range.	 
	 	2

	 	 	Explosiometer
	 	 	Three MSA passport Multifunction.	 
	 





J3 CASCADE AIR-BREATHING SYSTEM & SCBA EQUIPMENT




	 	 	 	 	 	 	 	 	 
	 	1

	 	 	Cascade breathing system
	 	 	N/A	 
	 	2

	 	 	Breathing apparatus
	 	 	N/A	 
	 	3

	 	 	Ten minute escape packs
	 	 	N/A	 
	 





J4




     FIRST AID EQUIPMENT



	 	 	 	 	 	 	 	 	 
	 	1

	 	 	First aid kits
	 	 	Two located on Rig floor and Tool pusher office.	 
	 





	 	 	 	 	 
	 






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	 	2

	 	 	Resuscitators
	 	 	One type AMBU in tool pusher office.	 
	 	3

	 	 	First aid stretchers
	 	 	One Neil Robertson located in Tool Pusher office.	 
	 	4

	 	 	Fire proof blankets
	 	 	One MSA 241003 asbestos free located in Tool Pusher office.	 
	 





J5 PERSONNEL PROTECTIVE EQUIPMENT




	 	 	 	 	 	 	 	 	 
	 	1

	 	 	Fireman’s Suits
	 	 	Two asbestos free located in Tool Pusher office.	 
	 	2

	 	 	Safety belts
	 	 	Adequate quantity for Contractor personnel	 
	 	3

	 	 	Safety Helmets
	 	 	Adequate quantity for Contractor personnel + 10 (ten) extra for visitors.	 
	 	4

	 	 	Safety glasses/goggles
	 	 	Confirmed	 
	 	5

	 	 	Safety boots
	 	 	Adequate quantity for Contractor personnel	 
	 	6

	 	 	Fire proof gloves, chemical proof gloves, chemical proof boots,

face shields
	 	 	2 (two) fire proof gloves, 6 (six) chemical proof gloves, 6 (six) chemical proof boots,
6 (six) face shields.	 
	 





J6 FIRE FIGHTING EQUIPMENT




	 	 	 	 	 	 	 	 	 
	 	1

	 	 	Fire water pumps
	 	 	One Milantractor GDMP60-250 or equivalent, 1,500 lt/min output @ 10 bar.	 
	 	2

	 	 	Fire fighting stations, including fire hoses and portable
extinguishers to be located at:
	 	 	Four hose reels will be installed closed to the pump. Capacity of portable extinguishers
is described below.	 
	 	 

	 	 	a) Diesel fuel storage area
	 	 	One for each tank with 50 Kg of capacity (powder).	 
	 	 

	 	 	b) Diesel Engine-generator area
	 	 	Two of 50 Kg each (powder) + Two of 5 Kg each (CO2).	 
	 	 

	 	 	c) S.C.R./Main control cabin area
	 	 	Two of 5 Kg each (CO2).	 
	 	 

	 	 	d) Mud tanks area
	 	 	Four of 12 Kg each (powder).	 
	 	 

	 	 	e) Mud pump area
	 	 	Two of 12 Kg each (powder).	 
	 





	 	 	 	 	 
	 






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	 	 	f) BOP Accumulator area
	 	 	Two of 12 Kg each (powder).	 
	 	 

	 	 	g) Rig floor area
	 	 	Two of 12 Kg each (powder) & two of 5 Kg each (CO2).	 
	 	 

	 	 	h) Offices/sleeping quarters at rig site
	 	 	For each barrracks:one of 12 Kg (powder) & one of 5 Kg of capacity (CO2).	 
	 





J7 MISCELLANEOUS SAFETY EQUIPMENT




	 	 	 	 	 	 	 	 	 
	 	1

	 	 	Derrickman escape line
	 	 	One Geronimo	 
	 	2

	 	 	Eye washing stations
	 	 	Three eye washing stations located at: mud check area of pit, mixing area, dog house.	 
	 	3

	 	 	Emergency shower stations
	 	 	One located in mixing area.	 
	 	4

	 	 	Portable emergency battery lights
	 	 	6 (six) explosion proof portable battery lights located in tool pusher office & rig floor	 
	 	5

	 	 	Wind socks
	 	 	3
(three) located at: location entrance, mud pits & tool
pusher’s office.	 
	 	6

	 	 	Air blowers
	 	 	4 (four) Hurricane 1877 — 36" fan driven by 3 hp electric motor and 424.8 m3/min of
capacity.	 
	 





K RIG SITE HOUSING/OFFICE REQUIREMENTS




	 	 	 	 	 	 	 	 	 
	 	1

	 	 	OPERATOR SUPERVISOR office/quarters
	 	 	2
Units, each including both an office & sleeping area, minimum
10'  ́ 40'  (each unit).	 
	 	 

	 	 	 	 	 	Office area: Desk, swivel chair, shelving, refrigerator, sink, coffee maker, microwave
oven, full view window, One of the two offices must include a second desk & chair,
plain paper fax machine.	 
	 





	 	 	 	 	 
	 






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	 	 	 	 	 	Sleeping area: Furnished with western standard mattress, sheets, pillow, locker,
carpet, AC & heating, night table, reading light, 13" (minimum) multi-system TV/VCR,
shower, western standard toilet and sink (shower/toilet/sink private)	 
	 	2

	 	 	OPERATOR Sleeping Quarters: 2 Bedrooms
	 	 	1 unit, sleeping quarters only, minimum 10'  ́ 25': Furnished with 2 western standard
mattresses, sheets, pillow, locker, carpet, AC & heating, night table, reading light,
shower, western standard toilet and sink	 
	 	3

	 	 	Mud Engineer quarters
	 	 	1 Unit, including both an office & sleeping area minimum 10'  ́ 40':	 
	 	 

	 	 	 	 	 	Office area: Desk, swivel chair, shelving, stainless steel lab sink, running water.	 
	 	 

	 	 	 	 	 	Sleeping area: Furnished with western standard mattress, sheets, pillow, locker,
carpet, AC & heating, night table, reading light, shower, western standard toilet and
sink	 
	 	4

	 	 	Contract Toolpusher office/quarters
	 	 	1 Unit, including both an office & sleeping area, minimum 10'  ́ 40'.	 
	 	 

	 	 	 	 	 	Office area: Desk, swivel chair, shelving, refrigerator, sink, coffee maker, microwave
oven, full view window, radio communications equipment, photocopy machine.	 
	 	 

	 	 	 	 	 	Sleeping area: Furnished with western standard mattress, sheets, pillow, locker,
carpet, AC & heating, night table, reading light, shower, western standard toilet and
sink	 
	 





	 	 	 	 	 
	 






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	 	5

	 	 	Service Operator personnel quarters.
	 	 	1 units, minimum 10'  ́ 30' (overall): furnished with 4 desks, 8 chairs and a sofa,
carpet, AC & heating, night table, reading light; a western standard toilette and sink.	 
	 	6

	 	 	Drilling camp facility
	 	 	Accommodations and facility in drilling camp for Senior staff to be permanently on site	 
	 





L RIG INTERCOMMUNICATION SYSTEM




	 	 	 	 	 	 	 	 	 
	 	1

	 	 	Intercommunication system:
	 	 	Philips MA 100 communication system with 8 stations located at: Operator man’s office,
toolpusher’s office, mud engineer’s office, rig floor, choke manifold, shakers, mud
mixing facility, and mud pumps	 
	 	2

	 	 	Intercommunication system between:
	 	 	Interfono ISTA / F1 between rig floor & derrick platform.	 
	 	3

	 	 	Public address system (type)
	 	 	Philips MA100.	 
	 	4

	 	 	Portable radios
	 	 	6 (six) Motorola GP900 explosion proof	 
	 	5

	 	 	Radio communication for Contractor’s use to and from Campsite
	 	 	Radio communication HF “SSB” or equivalent 125 WPEP power and frequency 1.6 to 30 MHz	 
	 	6

	 	 	Communication to and from Contractor’s bases
	 	 	One cellular satellite phone with fax Immarsat B ABB Nera.	 
	 





M Miscellaneous




	 	 	 	 	 	 	 	 	 
	 	1

	 	 	Water pumps (YELLOW DOG)
	 	 	Two IPC model Delta 120 water pumps driven by 20 hp electric motors 1,000 lt/min.	 
	 	2

	 	 	Cellar pump or cellar jetting system
	 	 	One GORMAN RUPP 6 ́6 or equivalent water pump driven by 40 hp electric motor 800 gpm.	 
	 





	 	 	 	 	 
	 






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	 	3

	 	 	Electric welding machines
	 	 	One electric welding machine and one diesel welding machine 400 amp.	 
	 	4

	 	 	Torch oxygen-acetylene / ossigen propane welding sets
	 	 	Two each.	 
	 	5

	 	 	Water blast cleaning machine
	 	 	One each SOLE 2000 - 7 gpm @ 120 bar complete with 3/8" hoses and closed gun.	 
	 	6

	 	 	Steam cleaning machine
	 	 	Two fixed SOLE 3000 or equivalent fixed installed in appropriate container with four
outside accessible quick connections and sufficient external hoses to reach all the
interessed points.	 
	 	7

	 	 	Steam cleaning machine (make-type)
	 	 	Two portable Sole 3000 or equivalent.	 
	 	8

	 	 	Wire line slings
	 	 	As required to handle tubulars	 
	 	9

	 	 	Warehouse buildings, workshops
	 	 	One warehouse barack 9 ́2.5 ́2.5 m One mechanic’s
workshop
9 ́2.5 ́2.5
m with separate section complete of desk and chair


One electrician workshop 6 ́2.5 ́2.5 m complete with desk
and chair.	 
	 	10

	 	 	Flair Burner assist system. Auto ignition with diesel or propane
	 	 	The system is complete with auto ignition by PLG	 
	 	11

	 	 	Diesel fuel storage
	 	 	86 m3 total (two tanks of 30 m3 each + one tank of 26 m3), complete with bunding and
centrifugal transfer pump.	 
	 	12

	 	 	Potable water tanks capacity
	 	 	One potable water tank 100 bbls capacity complete with transfer pump in appropiate
container.	 
	 	13

	 	 	Pipe Rack capacity
	 	 	5000 m total capacity.	 
	 





	 	 	 	 	 
	 






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	 	14

	 	 	Enclosed areas
	 	 	All the mentioned areas, will be enclosed with Tarpaulin canvans and will have the
following total volume air change/hr.: substructure No.12; engines No.6; compressors
No.6; mud pumps No.6	 
	 	15

	 	 	Air Compressors
	 	 	Two each Atlas Copco GA 409E, driven by 40 hp electric motors, max. flow rate 296 cu
ft/min - max service pressure 140 psi.


Two each air vessels 1.5 m3 capacity each .	 
	 	16

	 	 	Chemical storage area
	 	 	One 9 ́2.5 ́2.5 m chemical container with 9x4m	 
	 	17

	 	 	Mud testing portable lab (make-type)
	 	 	Baroid Lab # 82100 or equivalent	 
	 	18

	 	 	Mouse hole
	 	 	One
10" OD	 
	 	19

	 	 	Rat hole
	 	 	One
12" OD	 
	 	20

	 	 	Mud saver bucket for drill pipe (size)
	 	 	One Oteco or equivalent complete with adapters for all drill pipe size.	 
	 	21

	 	 	Wireline unit on rig floor for deviation surveys
	 	 	One
Mathey surveyor wire line unit complete with 18,000' of 0.092" wire, sheaves and
mechanical counter.	 
	 	22

	 	 	Deviation Recorder
	 	 	One
Totco Go Devil 1.5/8" OD, 0-8 degree clock running & fishing tools, sinkers bars.	 
	 	23

	 	 	Deviation Recorder
	 	 	One
Totco Go Devil 1.5/16" OD, 0-14 degree clock running & fishing tools, sinkers bars.	 
	 	24

	 	 	Drillpipe Wiper Rubbers
	 	 	3 Each: For each size DP provided.	 
	 	25

	 	 	Lube-oil storage
	 	 	See DWG 5827 1A1, unit is bunded	 
	 	26

	 	 	Equipment used for rat-hole/mouse-hole preparation.
	 	 	Rathole digger	 
	 	27

	 	 	Boilers
	 	 	Two ABCO boilers, 4.200 K/cal per hours complete with all stem lines connecting all mud
tanks, Koomey room and choke manifold barrack	 
	 






	 	 	 	 	 
	 






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	 	NINOTSMINDA OIL COMPANY LTD
	 
	 	 
	 





APPENDIX B




COMPENSATION




	 	 	 	 	 	 	 	 	 
	1. Rates and fees
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Mobilization fee:
	 	 	1,100,000	 	 	USD
	 
	 	 	 	 	 	 	 	 
	Demobilization fee:
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	i) After the firm well
	 	 	550,000	 	 	USD
	ii) After two wells
	 	 	430,000	 	 	USD
	iii)In the event Contractor is capable to find a Contract in direct
continuity with the last well under progress.
	 	 	0	 	 	USD
	 
	 	 	 	 	 	 	 	 
	A) Operating rate
	 	 	23,952	 	 	USD/Day
	 
	 	 	 	 	 	 	 	 
	B) Standby rate
	 	 	22,750	 	 	USD/Day
	 
	 	 	 	 	 	 	 	 
	C) Repair rate
	 	 	17,976	 	 	USD/Day
	 
	 	 	 	 	 	 	 	 
	D) Remedial rate
	 	 	10,776	 	 	USD/Day
	 
	 	 	 	 	 	 	 	 
	E) Force majeure rate
	 	 	18,000	 	 	USD/Day
	 
	 	 	 	 	 	 	 	 
	F) Force majeure rate without crew
	 	 	11,976	 	 	USD/Day
	 
	 	 	 	 	 	 	 	 
	G) Extended stand by rate.
	 	 	18,000	 	 	USD/Day
	 
	 	 	 	 	 	 	 	 
	H) Extended stand by rate without crew. ( see note*)
	 	 	8,000	 	 	USD/Day
	 
	 	 	 	 	 	 	 	 
	I) Moving rate
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	a) With crew
	 	 	15,984	 	 	USD/Day
	b) Without crew ( ref. art 8.4 option 1)
	 	 	11,976	 	 	USD/Day






• Note: The rate of remuneration for extended stand-by rate without crew will be applicable for the
first month only, thereafter will be increased by 1.35 times each following month.



	 	 	 
	 
	 	 
	 





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	2.  	Early termination
	 
	(a)  	Before Commencement date.






	 	•  	1,000,000 USD lump sum in the event of early termination of contract before the date
when the first load of the Drilling Unit has been mobilized ( this early termination fee
shall not apply in the event of early termination in accordance to article 9.5 )
	 
	 	•  	1,000,000 USD + Demobilisation fee in the event of early termination of contract after
the date when the first load of the Drilling Unit has been mobilized.






	(b)  	After the spud of the first well and prior the completion of the first well program
Contractor shall be reimbursed as per the following formula:






     Early
termination fee = ( 120 – N ) x 50% of Operating Rate



Where




120 = planned number of days to complete the firm well

N = where N is the number of days elapsing from the Commencement Date to the early termination date




It is understood that in the event the well program is completed prior the 120 days not early
termination fee shall be applicable





	3.  	Moving between locations





OPTION 1 – Daily Rate Basis




Rata I (Moving Rate) for the moving time plus Hoisting and transportation means at Contractor care
and Operator cost plus the applicable handling fee or at Operator care and cost.




To the moving between location at the daily rate remuneration basis the following incentive scheme
(Bonus - Malus) shall apply :




Moving performed less than 10 days ( moving location within 20 km )




5,000 USD / day shall be added to the moving rate for each day saved ( pro-rata )




	 	 	 
	 
	 	 
	 





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Moving performed between 11 and equal to max 13 days 




NIL




Moving performed more than 14 days




8,000 USD / day shall be deducted from the moving rate for each day in excess of the
14th day




OPTION 2 - Lump Sum Basis




(a) Up to 20 Km




Lump sum fee 250,000 USD.




(b) Up to 50 Km




Lump sum fee 310,000 USD.




For moving between location in excess of the above indicated 50 km the parties will agree relevant
compensation fee.




4. Accommodation and meals.




	 	 	 
	Breakfast

	 	10 USD/Day
	Lunch

	 	15 USD/Day
	Dinner

	 	15 USD/Day
	Accommodation only

	 	10 USD/Day






5. Additional Personnel




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	Position	 	 	Nationality	 	 	USD Day	 	 	No. At site.	 	 	Assigned	 
	 	Rig Superintendent

	 	 	Exp
	 	 	 	1,100	 	 	 	 	1	 	 	 	 	2	 	 
	 	Toolpusher

	 	 	Exp
	 	 	 	1,000	 	 	 	 	1	 	 	 	 	2	 	 
	 	Tourpusher

	 	 	Exp
	 	 	 	850	 	 	 	 	1	 	 	 	 	2	 	 
	 	Driller

	 	 	Exp.
	 	 	 	750	 	 	 	 	2	 	 	 	 	4	 	 
	 	Assistant Driller

	 	 	Loc.
	 	 	 	400	 	 	 	 	2	 	 	 	 	4	 	 
	 	Chef Mechanic

	 	 	Exp.
	 	 	 	750	 	 	 	 	1	 	 	 	 	2	 	 
	 	Chef Electrician

	 	 	Exp.
	 	 	 	750	 	 	 	 	1	 	 	 	 	2	 	 
	 	Welder

	 	 	Loc.
	 	 	 	300	 	 	 	 	1	 	 	 	 	2	 	 
	 	Derrickman

	 	 	Loc.
	 	 	 	350	 	 	 	 	2	 	 	 	 	4	 	 
	 	Floorman

	 	 	Loc.
	 	 	 	250	 	 	 	 	6	 	 	 	 	12	 	 
	 





	 	 	 
	 
	 	 
	 





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	 	Position	 	 	Nationality	 	 	USD Day	 	 	No. At site	 	 	Assigned	 
	 	Roustabout

	 	 	Loc.
	 	 	 	200	 	 	 	 	4	 	 	 	 	8	 	 
	 	Mechanic helper

	 	 	Loc.
	 	 	 	300	 	 	 	 	1	 	 	 	 	2	 	 
	 	Electrician Helper

	 	 	Loc.
	 	 	 	300	 	 	 	 	1	 	 	 	 	2	 	 
	 	Interpreter/Radio Operator

	 	 	Loc.
	 	 	 	250	 	 	 	 	1	 	 	 	 	2	 	 
	 	Forklift/Crane Operator

	 	 	Loc.
	 	 	 	350	 	 	 	 	1	 	 	 	 	2	 	 
	 	Driver

	 	 	Loc.
	 	 	 	300	 	 	 	 	1	 	 	 	 	2	 	 
	 





The above daily rates shall be applicable from the moment the personnel arrive at the Operating
Area. To the above traveling cost shall be invoiced to Company at Cost.




6. Additional equipment




TBA




	 	 	 
	 
	 	 
	 





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APPENDIX C




CONTRACTOR AND OPERATOR’S ITEMS AND RESPONSABILITIES.




	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	OP =	 	CON =
	 	 	 	 	 	 	 	 	Operator	 	Contractor
	 	 	 	 	 	 	 	 	Provided by	 	At Cost of
	A.

	 	 	 	 	 	GENERAL	 	 	 	 
	 
	

	 	 	1.	 	 	Required license, permit clearance to enter and/or leave
drilling location.
	 	OP
	 	OP
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	2.	 	 	Required license, permit to operate the drilling in
conformity with local legislation.
	 	CON
	 	CON
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	3.	 	 	Required licenses to utilise import/export materials
equipment necessary to the project.
	 	CON
	 	OP
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	4.	 	 	Furnish and maintain road to location.
	 	OP
	 	OP
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	5.	 	 	Construction and maintenance of drilling site.
	 	OP
	 	OP
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	6.	 	 	Restore location
	 	OP
	 	OP
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	7.	 	 	24 hrs Security at drilling site for personnel
	 	OP
	 	OP
	 
	 	 	 	 	 	 	 	 	 	 
	B.

	 	 	 	 	 	TRANSPORTATION	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	1.	 	 	Transportation of Operator, and Operator’s third party
personnel to and from the Drilling Unit.
	 	OP
	 	OP
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	2.	 	 	Transportation of Contractor’s personnel and third party
Contractor’s personnel to and from the drilling site.
	 	CON
	 	CON
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	3.	 	 	Mobilisation of the drilling unit to first well site (Lump
sum as per Appendix “B”).
	 	CON
	 	OP
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	4.	 	 	Demobilisation of the drilling unit at conclusion of the
Contract (Lump sum as per Appendix “B”).
	 	CON
	 	OP
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	5.	 	 	Hoisting and transportation means to move the drilling
unit between locations.
	 	CON
	 	CON/OP










	 	 	 
	 
	 	 
	 




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	 	 	 	 	 	 	 	 	OP =	 	CON =
	 	 	 	 	 	 	 	 	Operator	 	Contractor
	 	 	 	 	 	 	 	 	Provided by	 	At Cost of
	

	 	 	6.	 	 	Transportation of Contractor’s supplies and materials
including catering equipment to well site.
	 	CON
	 	CON
	 
	 	 	 	 	 	 	 	 	 	 
	C.

	 	 	 	 	 	THIRD PARTY SERVICES	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	

	 	 	1.	 	 	Electric well logging equipment and services.
	 	OP
	 	OP
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	2.	 	 	Mud logging equipment and services.
	 	OP
	 	OP
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	3.	 	 	Mud services.
	 	OP
	 	OP
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	4.	 	 	Casing running services. ( Power tong / Operator )
	 	OP
	 	OP
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	5.	 	 	Directional drilling surveys and services. (Only Totco).
	 	CON
	 	CON
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	6.	 	 	Cementing service, maintenance and rental of cementing
unit.
	 	OP
	 	OP
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	7.	 	 	Coring Services not on rig inventory.
	 	OP
	 	OP
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	8.	 	 	Well test equipment and services.
	 	OP
	 	OP
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	9.	 	 	Inspection of Contractor’s DP, DC and other in hole
equipment in accordance with API RP 7G and prior to
Commencement date.
	 	CON
	 	CON
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	10.	 	 	Additional inspection of Contractor’s DP, DC and other in
hole equipment requested by Operator.
	 	CON
	 	OP
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	11.	 	 	Waste disposal treatment.
	 	OP
	 	OP
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	12.	 	 	Food and accommodation for Contractor personnel including
7 Operator personnel .
	 	CON
	 	CON
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	13.	 	 	Food and accommodation for Operator or third party
Operator in excess of 7 personnel. Remuneration as per
Schedule C.
	 	CON
	 	OP
	 
	 	 	 	 	 	 	 	 	 	 
	D.

	 	 	 	 	 	MATERIALS AND SUPPLIES	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	1.	 	 	All bulk and mud chemicals.
	 	OP
	 	OP
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	2.	 	 	All fuel for Drilling Unit.
	 	OP
	 	OP
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	3.	 	 	Greases and dope for Contractor’s DP and DC.
	 	CON
	 	CON
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	4.	 	 	Greases and dope for casing and Operator equipment.
	 	OP
	 	OP
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	5.	 	 	Greases and lubricants for the Drilling Unit.
	 	CON
	 	CON






	 
	 	 
	 





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	 	 	 	 	 	 	 	 	OP =	 	CON =
	 	 	 	 	 	 	 	 	Operator	 	Contractor
	 	 	 	 	 	 	 	 	Provided by	 	At Cost of
	

	 	 	6.	 	 	Drilling water.
	 	OP
	 	OP
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	7.	 	 	Fresh water appliances for rig toilets
	 	OP
	 	OP
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	8.	 	 	Potable water.
	 	OP
	 	OP
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	9.	 	 	Drilling bits and core heads.
	 	OP
	 	OP
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	10.	 	 	CSG, wellhead, cementing accessories and liner hanger.
	 	OP
	 	OP
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	11.	 	 	Cement + additives.
	 	OP
	 	OP
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	12	 	 	Drilling jars and stabilizers
	 	CON / OP
	 	OP
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	13	 	 	Inspection, repair, loss in hole charges of the above items
	 	CON / OP
	 	OP
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	14a.	 	 	Screens for shale shaker ( up to 100 mesh )
	 	CON
	 	CON
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	14b.	 	 	Screens for shale shaker ( finer than 100 mesh )
	 	CON
	 	OP
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	15.	 	 	Re-billable consumables specifically requested by Operator.
	 	CON
	 	OP
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	16.	 	 	Communication equipment and services between rig-site and
operating base.
	 	OP
	 	OP
	 
	 	 	 	 	 	 	 	 	 	 
	E.

	 	 	 	 	 	DRILLING EQUIPMENT	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	1.	 	 	Contractor’s equipment as described in the rig in Appendix
A, including replacement for normal wear and tear of
equipment.
	 	CON
	 	CON
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	2.	 	 	Equipment and other items required for normal drilling
operations and not otherwise treated in this Appendix
	 	CON
	 	CON
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	3.	 	 	Cranage at drilling site
	 	CON/OP
	 	OP






	 	 	 
	 
	 	 
	 





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APPENDIX D




CONTRACTOR’S PERSONNEL




Drilling Personnel – Rig Emsco Ideco E 2.100 n° 5827.




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	Position	 	 	Nationality	 	 	Daily/On-shift	 	 	No. At site.	 	 	Assigned	 
	 	OFFICE BASED
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	Project manager

	 	 	Exp.
	 	 	Daily
	 	 	 	1	 	 	 	 	1	 	 
	 	Purchase officer

	 	 	Loc
	 	 	Daily
	 	 	 	1	 	 	 	 	1	 	 
	 	Finance administration

	 	 	Loc
	 	 	Daily
	 	 	 	1	 	 	 	 	1	 	 
	 	Secretary

	 	 	Loc
	 	 	Daily
	 	 	 	1	 	 	 	 	1	 	 
	 	RIG SITE BASED
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	Rig Superintendent

	 	 	Exp
	 	 	Daily
	 	 	 	1	 	 	 	 	2	 	 
	 	Toolpusher

	 	 	Exp
	 	 	Daily
	 	 	 	1	 	 	 	 	2	 	 
	 	Tourpusher

	 	 	Exp
	 	 	Daily
	 	 	 	1	 	 	 	 	2	 	 
	 	Driller

	 	 	Exp.
	 	 	On-shift
	 	 	 	2	 	 	 	 	4	 	 
	 	Assistant Driller

	 	 	Loc.
	 	 	On-shift
	 	 	 	2	 	 	 	 	4	 	 
	 	Chef Mechanic

	 	 	Exp.
	 	 	Daily
	 	 	 	1	 	 	 	 	2	 	 
	 	Chef Electrician

	 	 	Exp.
	 	 	Daily
	 	 	 	1	 	 	 	 	2	 	 
	 	Welder

	 	 	Loc.
	 	 	Daily
	 	 	 	1	 	 	 	 	2	 	 
	 	Derrickman

	 	 	Loc.
	 	 	On-shift
	 	 	 	2	 	 	 	 	4	 	 
	 	Floorman

	 	 	Loc.
	 	 	On-shift
	 	 	 	6	 	 	 	 	12	 	 
	 	Roustabout

	 	 	Loc.
	 	 	On-shift
	 	 	 	4	 	 	 	 	8	 	 
	 	Mechanic helper

	 	 	Loc.
	 	 	Daily
	 	 	 	1	 	 	 	 	2	 	 
	 	Electrician Helper

	 	 	Loc.
	 	 	Daily
	 	 	 	1	 	 	 	 	2	 	 
	 	Interpreter/Radio Operator

	 	 	Loc.
	 	 	Daily
	 	 	 	1	 	 	 	 	2	 	 
	 	Forklift/Crane Operator

	 	 	Loc.
	 	 	Daily
	 	 	 	1	 	 	 	 	2	 	 
	 	Driver

	 	 	Loc.
	 	 	Daily
	 	 	 	1	 	 	 	 	2	 	 
	 





Catering Personnel as necessary.




The above indicated personnel has been considered 24 hours a day as per the following 12 hours
shift:




Exp.: 35 on/ 28 off. PM not included on shift.



Local: 14/14.



	 	 	 
	 
	 	 
	 





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APPENDIX E




PRE SPUD INSPECTION




5827 DRILLING UNIT INSPECTION: COMMISSIONING AND ACCEPTANCE TESTS PRIOR TO COMMENCEMENT





	1.1  	Mud Pumps and High Pressure Mud System
	 
	1.1  	Each pump will be tested up with its supercharging pump, using water, for ONE (1) hours
continuously across the choke manifold.
	 
	   	Each pump will be tested up to its rated maximum pressure and speed, depending on the
liners installed.
	 
	   	Pressure and stroke counters will be checked wherever installed to verify that readings
coincide.
	 
	   	If the pump being tested is stopped for repairs the test will re-commence from the
beginning.
	 
	1.2  	All discharge manifold will be tested to the maximum applicable pressure rating for the
liner size installed. (Where applicable discharge manifold should be tested to the rated
pressure).
	 
	1.3  	Choke manifold will be tested to its maximum rated working pressure, with water, for
fifteen (15) minutes. Test should be inclusive of Low / High pressure test.
	 
	1.4  	Floor stand-pipe manifolds, rotary hoses and connections will all tested, with water, to
maximum working pressure for fifteen (15) minutes.
	 
	   	Each valve will be tested for approximately six (6) minutes at their maximum working
pressures.


Cement lines, manifold and kill lines and manifold will also be tested for fifteen (15)
minutes, with water, and each valve for approximately six (6) minutes each to their
maximum rated working pressure.
	 
	1.5.1  	All high pressure tests will be recorded on chart recorders and signed-off by CONTRACTOR’s
and OPERATOR’s representatives.
	 
	1.2  	Mud Treatment and Low Pressure Mud System
	 
	2.1  	Each centrifugal transfer and mixing pumps will be tested with water continuously for one
(1) hour. Transfer of fluids from tank to tank using the various available transfer and
mixing lines will be functionally







	 





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	   	verified and tested during such time. All valves should
be tested to confirm free of leaks.
	 
	2.2  	Operate and function test the vacuum degasser. Verify vacuum pressure is to specification.
	 
	2.3  	Operate and function test shakers with water.
	 
	2.4  	Operate and function desilter, mud-cleaners and desander. Check that suction and discharge
lines are correctly positioned. Note that screens of mud-cleaners and/or shakers may
deteriorate with excessive testing with water alone. Limit test duration for such equipment.
	 
	2.5  	Function test agitators and mud guns in all equipped tank. Function and verify transfer
options between tanks. Verify that mud tank measuring and gain/loss equipment is operating
correctly and has been correctly calibrated. Check tank measuring devices such that they are
correctly calibrated. Verify diesel supply lines, rates of supply and transfer options
between tanks. Check that a volumetric counter is available and that it is correctly
calibrated.
	 
	3.0  	Bulking Plant (if supplied)
	 
	3.1  	Test air lines and valves. Check for leaks.
	 
	3.2  	Test silos at their rated pressures with air.
	 
	3.3  	Using 15 tones of Barytes function transfers from silo to silo Check load cell calibration,
time for transfer and amount of barytes left untransferred by the end of the test.
	 
	4.0  	Blow Out-Preventers and Well Control Equipment
	 
	4.1  	Each preventer unit shall be function tested and times, pressure and volumes of control
fluid required recorded. Function tests will be carried out from the BOP control unit,
Driller’s remote panel and other remote panel (if any) for each preventer and hydraulically
controlled valve.
	 
	4.2  	Each preventer will be pressure tested for fifteen
(15) minutes with water.


Test should be carried out at low pressure for five (5) minutes and ten (10) minutes at
the rated pressure.
	 
	4.3  	Fill the trip tank and check the calibration. Check the operation of fill-up pump, valving
and dump valve.





	 
	 	 
	 





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	5.0  	BOP Control Unit
	 
	5.1  	Following verification of pre-charge pressure the BOP control unit will be charged to its
working pressure utilising air and electric pumps. The time taken to reach working pressure
shall be noted and recorded and confirmed within specification. The control unit will then
be purged to its pre-charge pressure and then, using the electric pump or pumps only,
charged to its working pressure and the time taken noted and recorded and confirmed within
specification. The control unit will then be purged again to its pre-chare pressure and
then, using the air pump or pumps only, charged to its working pressure and the time taken
noted and recorded and confirmed within specification.
	 
	5.2  	Place a pup-joint across the annular preventer and disconnect the air and electric charge
pumps. Observe and record the pressure in the control unit. Close all the preventers
sequentially in the stack noting and recording the times for each preventer to close and the
quantity of hydraulic fluid used to operate the closing of each preventer. Note and record
residual pressures in the control unit and confirmed these with manufactures performance
characteristics.
	 
	   	Re-connect the air and electric pumps and recharge the unit to its working pressure. Note
and record the time taken for the unit to achieve its working pressure. Note and record
the pressures at which the pumps stop and start.
	 
	6.0  	Hoist and Mast Equipment
	 
	6.1  	Hoist will be worked, without load, at each speed.
	 
	6.2  	Catheads will be functioned and oil and air pressures checked and calibrated. Torque
measuring equipment will be checked and calibrated.
	 
	6.3  	Check auxiliary brake and crown block protection device.

	 
	6.4  	Check all measuring devices and calibrate if necessary.

	 
	6.5  	Operate the stabbing board.
	 
	7.0  	Rotary Table
	 
	7.1  	Operate the rotary table for one (1) hour under no load at various speeds.
	 
	   	Check the rotary lock





	 
	 	 
	 





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	   	Calibrate the rotary torque measurement device and the rotary speed counter.
	 
	8.0  	Equipment and Spare Part Inventory
	 
	8.1  	A full inventory of the contractual list of equipment will be taken and verified by
OPERATOR’s representative with the aid of CONTRACTOR’s representative.
	 
	8.2  	CONTRACTOR’s inventory of spare parts will be inspected by OPERATOR’s representative.
	 
	9.0  	Certification
	 
	9.1  	Availability of Inspection certificates for downhole and major hoisting equipment.





	 	 	 
	 
	 	 
	 





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APPENDIX F




PAYMENTS GUARANTEE





	Summary:	 





CONFIRMED IRREVOCABLE
STAND -  BY LETTER OF CREDIT FORMAT 1




CONFIRMED IRREVOCABLE
STAND - BY LETTER OF CREDIT FORMAT 2




CONFIRMED IRREVOCABLE
STAND - BY LETTER OF CREDIT FORMAT 3




	 	 	 
	 
	 	 
	 





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     IRREVOCABLE STAND - BY LETTER OF CREDIT FORMAT 1



          ...........................

          (
Issuing Bank: H.S.B.C)



(Advising Bank: H.S.B.C. Milan Branch)




RE : OUR IRREVOCABLE STAND - BY LETTER OF CREDIT N°...............




     By order and for the account of ......................- hereafter referred to as COMPANY, we issue an
Irrevocable Stand - By Letter of Credit N°.......... in favour of SAIPEM S.P.A. -Via Martiri di
Cefalonia, 67 - San Donato Mil.se, Milano, Italy-, hereafter referred to as Saipem for the amount
of USD 1,100,000 (One Million and one hundred thousand United States Dollars).
The validity of this Stand - By Letter of Credit is up to
July 15th, 2005.


Funds under this credit will be available to you on first demand upon our receipt of the following
documents:



a) Your original statement purpotedly signed by an authorized representative of Saipem stating
“COMPANY has failed to comply with the payment conditions of the drilling contract dated......... with
Saipem S.p.A., therefore we draw USD 1,100,000 under Stand-By letter of credit n° ........ issued in
our favor by Issuing bank ” ;




b) Copy of invoice issued to COMPANY for mobilisation services rendered under the Drilling
Contract dated ........between Saipem and COMPANY.




Reference to the drilling contract is for information purposes only and its terms and conditions
are not incorporated in this Stand-By letter of credit.




	 	 	 
	 
	 	 
	 





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Partial drawings are not permitted.




This credit is not transferable. Credit and rights under this Standby Letter of Credit shall not be
assigned. For the avoidance of doubt, nothing in this Standby Letter of Credit shall confer on any
third party any benefit or the right to enforce any terms of this Standby letter of Credit




All fees and commissions inside and outside the country of issue are for the account of the
COMPANY.




This Stand - By Letter of Credit is subject to the Uniform Custom and Practice for Documentary
Credits ( 1993 revision ), International Chamber of Commerce Publication N° 500.




Any matter not covered by these rules shall be governed by English law and any dispute arising out
of this Stand-By letter of credit or its performance shall be subject to the exclusive jurisdiction
of the Court of London without regard to the conflict of law rules thereof.




We hereby engage with you that payment will be duly made at sight at your counters against
documents presented in conformity with the terms of this Stand-By letter of credit.




	 	 	 
	 
	 	 
	 





page 68 of 72




 









 





	 	 	 
	

	 	NINOTSMINDA OIL COMPANY LTD
	 
	 	 
	 





IRREVOCABLE STAND - BY LETTER OF CREDIT FORMAT 2



     (Issuing Bank: H.S.B.C.)



(Advising Bank: H.S.B.C. Milan Branch)




RE : OUR IRREVOCABLE STAND - BY LETTER OF CREDIT No...............




     By order and for the account of ....................- hereafter referred to as COMPANY, we issue an
Irrevocable Stand - By Letter of Credit N°.......... in favour of SAIPEM S.P.A. -Via Martiri di
Cefalonia, 67 - San Donato Mil.se, Milano, Italy-, hereafter referred to as Saipem up to Amount
of USD 2,250,000 (Two Millions and two hundred and fifty thousand
United States Dollars).


The validity of this Stand - By Letter of Credit is up to
October 30th, 2005.


Funds under this credit will be available to you on first demand upon our receipt of the following
documents:



a) Your original statement purpotedly signed by an authorized representative of Saipem stating
“COMPANY has failed to comply with the payment conditions of the drilling contract dated......... with
Saipem S.p.A., therefore we draw up to Amount of USD 2,250,000 (Two Millions and two hundred and
fifty thousand United States Dollars) under Stand-By letter of credit n° ........ issued in our favor
by Issuing bank”;




b) Copy of invoice(s) issued to COMPANY for drilling services rendered under Contract dated.....
between Saipem and COMPANY.




	 	 	 
	 
	 	 
	 





page 69 of 72




 









 





	 	 	 
	

	 	NINOTSMINDA OIL COMPANY LTD
	 
	 	 
	 





Reference to the drilling contract is for information purposes only and its terms and conditions
are not incorporated in this letter of credit.




Partial drawings are permitted.The total amount of this Standby Letter of Credit shall be reduced
accordingly to reflect the partial drawings if any.




This credit is not transferable.Credit and rights under this Standby Letter of Credit shall not be
assigned. For the avoidance of doubt, nothing in this Standby Letter of Credit shall confer on any
third party any benefit or the right to enforce any terms of this Standby letter of Credit




All fees and commissions inside and outside the country of issue are for the account of the COMPANY




This Stand - By Letter of Credit is subject to the Uniform Custom and Practice for
Documentary Credits ( 1993 revision ), International Chamber of Commerce Pubblication N° 500.




Any matter not covered by these rules shall be governed by English law and any dispute arising out
of this Stand-By letter of credit or its performance shall be subject to the exclusive jurisdiction
of the Court of London without regard to the conflict of law rules thereof.




We hereby engage with you that payment will be duly made at sight at your counters against
documents presented in conformity with the terms of this Stand-By letter of credit.




	 	 	 
	 
	 	 
	 





page 70 of 72




 









 





	 	 	 
	

	 	NINOTSMINDA OIL COMPANY LTD
	 
	 	 
	 





     
IRREVOCABLE STAND - BY LETTER OF CREDIT FORMAT 3



     (Issuing Bank:H.S.B.C.)



(Advising Bank: H.S.B.C. Milan Branch)




RE : OUR IRREVOCABLE STAND - BY LETTER OF CREDIT No...............




     By order and for the account of ......................- hereafter referred to as COMPANY, we issue an
Irrevocable Stand - By Letter of Credit N°.......... in favour of SAIPEM S.P.A. -Via Martiri di
Cefalonia, 67 - San Donato Mil.se Milano, Italy-, hereafter referred to as Saipem for the amount
of USD 550.000,00 (Five hundred and fifty Thousand United States
Dollars).


The validity of this Stand - By Letter of Credit is up to
December 30th, 2005.


Funds under this credit will be available to you on first demand upon our receipt of the following
documents:



a) Your original statement purpotedly signed by an authorized representative of Saipem stating
“COMPANY has failed to comply with the payment conditions of the drilling contract dated......... with
Saipem S.p.A., therefore we draw USD 550,000 under Stand-By letter of credit n° ........ issued in our
favor by Issuing bank ”;




b) Copy of invoice issued to COMPANY for demobilisation services rendered under the Drilling
Contract dated......... between Saipem and COMPANY.




	 	 	 
	 
	 	 
	 





page 71 of 72




 









 





	 	 	 
	

	 	NINOTSMINDA OIL COMPANY LTD
	 
	 	 
	 





Reference to the drilling contract is for information purposes only and its terms and conditions
are not incorporated in this Stand-by letter of credit.




Partial drawings are not permitted.




This credit is not transferable. Credit and rights under this Standby Letter of Credit shall not be
assigned. For the avoidance of doubt, nothing in this Standby Letter of Credit shall confer on any
third party any benefit or the right to enforce any terms of this Standby letter of Credit




All fees and commissions inside and outside the country are for the account of the COMPANY




This Stand - By Letter of Credit is subject to the Uniform Custom and Practice for
Documentary Credits ( 1993 revision ), International Chamber of Commerce Pubblication N° 500.




Any matter not covered by these rules shall be governed by English law and any dispute arising out
of this Stand-By letter of credit or its performance shall be subject to the exclusive jurisdiction
of the Court of London without regard to the conflict of law rules thereof.




We hereby engage with you that payment will be duly made at sight at your counters against
documents presented in conformity with the terms of this Stand-By letter of credit.




	 	 	 
	 
	 	 
	 





page 72 of 72