EXHIBIT 10.23


 




THE SECOND AMENDMENT TO THE GAS SALES
AGREEMENT


 





 


BETWEEN


 


PTT PUBLIC COMPANY LIMITED


 


AND


 


CHEVRON OFFSHORE (THAILAND) LIMITED


 


THAIPO LIMITED


 


PALANG SOPHON LIMITED


 


B8/32 PARTNERS LIMITED


 


DATED


 


EFFECTIVE AS OF OCTOBER 1, 2001


 

















 


THE SECOND AMENDMENT TO THE GAS SALES AGREEMENT (the “GSA”) dated
November 7th, 1995 is hereby made effective as of the 1st day of October, 2001.


 


BETWEEN


 


(1)          PTT PUBLIC COMPANY
LIMITED, successor in interest to The PETROLEUM AUTHORITY OF THAILAND, having
its principal office at 555 Vibhavadi Rangsit Road, Bangkok 10900 (hereinafter
called “PTT”); and


 


(2)          THAIPO LIMITED, a
company duly incorporated and existing under the laws of Thailand and having an
office at 8th floor, M. Thai Tower, All Seasons Place, 87 Wireless
Road, Khwaeng Lumpini, Khet Patumwan, Bangkok 10330 (hereinafter called
“THAIPO”); and


 


(3)          CHEVRON OFFSHORE
(THAILAND) LIMITED, formerly known as Thai Romo Limited, a company duly
incorporated and existing under the laws of Thailand and having its registered
office at 27th Floor, Suntowers Building B, 123 Vibhavadi-Rangsit
Road, Kwaeng Ladyao, Khet Jatujak, Bangkok 10900 (hereinafter called
“CHEVRON”); and


 


(4)          PALANG SOPHON LIMITED, a
company duly incorporated and existing under the laws of Thailand and having
its registered office at 5th Floor, Bangkok Insurance/Y.W.C.A.
Building, 25 Sathon Tai Road, Khwaeng Thungmahamek, Khet Sathon, Bangkok 10120
(hereinafter called “SOPHON”); and


 


(5)          B8/32 PARTNERS LIMITED,
a company duly incorporated and existing under the laws of Thailand and having
an office at 8th floor, M. Thai Tower, All Seasons Place, 87
Wireless Road, Khwaeng Lumpini, Khet Patumwan, Bangkok 10330 (hereinafter
called “B8/32 PARTNERS”).


 


THAIPO, CHEVRON, B8/32 PARTNERS and SOPHON hereinafter all collectively
called “Concessionaire”)


 


WHEREAS:


 


(A) The Concessionaire and PTT have signed a Memorandum of
Understanding dated October 17, 2001 stating their agreement to various matters
related to the GSA including the following:


 


(i)                                     the
terms for PTT to purchase quantities of 
Sales Gas in excess of one hundred forty five (145) million Cubic Feet
per day;


 


(ii)                                  the
adjustment of the Heating Value of the 
Sales Gas;


 

















 


(iii)                               Natural
Gas to be provided by Concessionaire from fields outside the G.S.A. Area; and


 


(iv)                              other
matters such as temperature, Shortfall and possible long-term sales/purchases.


 


(B) The Concessionaire and PTT later agreed to discuss the definition
of “Fy” — the fuel oil price variable, and “I” — the exchange rate.”


 


(C) The Concessionaire and PTT agreed to sign a mutually acceptable
amendment to the GSA to more specifically describe what has been determined
pursuant to such Memorandum of Understanding.


 


NOW IT IS HEREBY AGREED AS FOLLOWS THAT THE GSA SHALL BE AMENDED BY
THIS SECOND AMENDMENT TO REFLECT:


 


1. DEFINITIONS


 


Article 1
Definitions shall have the following definitions added;


 


•                  “Interim
Period” shall mean the period of time commencing as of 6:00 a.m. October 1,
2001 and ending 6:00 a.m. March 1, 2004.


•                  “Supplemental
Gas Quantities” shall mean the volumes of Sales Gas purchased by PTT during the
Interim Period pursuant to the terms stated in Article XXXII in addition to the
GSA Quantities.


•                  “Supplemental
DAQ” shall mean the quantities shown in Column 2 of the Sixth Schedule.


•                  “Supplemental
Shortfall Gas” shall mean the undelivered difference between the Sales Gas, in
excess of GSA Quantities, actually delivered by the Concessionaire on any day,
as the same may be reduced pursuant to this Agreement, and the Sales Gas nominated
by PTT pursuant to, and in accordance with, this Article XXXII, as the same may
be reduced pursuant to this Agreement.


•                  “Total
Supplemental DAQ” shall mean the quantities shown in Column 3 of the Sixth
Schedule.


•                  “GSA
Quantities”, solely for the purpose of Article XXXII, shall mean “the greater
of (i) one hundred and forty five (145) million Cubic Feet per day and (ii) the
then current DCQ plus 15%”.


 


2. QUALITY


 


The Second Schedule (Quality Specification) shall be amended as
follows:


 


(a)          The first sentence shall
be amended to read, “Sales Gas delivered under this Agreement shall at the
Delivery Point (unless otherwise specified herein)”.


 

















 


(b)          Item 8 shall be revised
to read as follows:


 


“Heating Value: have a flow-weighted average Gross Calorific Value for
the combined Delivery Points of not less than nine hundred and fifty (950) BTU
per Cubic Foot and not more than one thousand two hundred and twenty five
(1,225) BTU per Cubic Foot.  However,
Sales Gas at the Tantawan Delivery Point shall not have a Gross Calorific Value
of more than one thousand one hundred and fifty (1,150) BTU per Cubic Foot and
Sales Gas at the Benchamas Delivery Point shall not have a Gross Calorific
Value of more than one thousand two hundred and fifty (1,250) BTU per Cubic
Foot”.


 


(c)           Item 9 shall be revised
to read as follows:


 


“TEMPERATURE:  have a
temperature which is not less than sixty (60) degrees Fahrenheit and not more
than one hundred and thirty (130) degrees Fahrenheit until Concessionaire
installs equipment modifications designed to cool the Sales Gas below one
hundred and twenty (120) degrees Fahrenheit during the Year 2002.  At the earlier of placing such modified
equipment in service or 6 a.m. January 1st 2003, the maximum allowed
temperature shall be reduced from one hundred thirty (130) degrees Fahrenheit
to one hundred twenty (120) degrees Fahrenheit”.


 


(d)          The addition of a new
Item 10 to read:


 


“10.  PENTANE PLUS COMPONENTS:  contain no more than two
(2.0) mole percent of components consisting of pentane plus (C5+) in the
composite Sales Gas stream for the combined Delivery Points on a flow-weighted
average basis.”


 


3. PRICE CALCULATION


 


The definitions of the terms “Fy” and “I”
contained in Clause 11.5 of the GSA are amended to read:


 


Fy  =                     the arithmetic
average of the figures last published, Platts Oilgram Price Report date, for
each month of the six month period ending in March and September respectively
in which the prices have to be adjusted, in United States Dollars per barrel of
the Singapore Product Postings for Med FO 180cst from Shell Eastern Petroleum
PTE Ltd., ESSO Singapore PTE Ltd., Mobil Sales and Supply Corporation, Caltex
Petroleum Corporation, BP Oil International and 


 

















 


Singapore Petroleum Corporation PTE Ltd., as
published in “Platt’s Oilgram Price Service”.


 


I  =                               the
exchange rate, which shall be the arithmetic average of the daily Interbank
Exchange Rate of Baht per US Dollar published by The Bank of Thailand for the
Month of March 1995.  This rate is
agreed to be 24.75826.


 


4. ADDITIONAL GAS RESERVES  


 


The following new Clause 2.5. shall be added:


 


“2.5.                        In addition to Sales Gas
delivered from the Field Reserves, Concessionaire has the right, but not the
obligation, to deliver Sales Gas to PTT pursuant to this Agreement produced from
any areas that are not included within the G.S.A. Area including, but not
limited to, the following two fields within the Concession Area:


 


Maliwan Field (Block 8/32)


 


North Jarmjuree Field (Block 8/32)


 


and the fields delineated within Block 9A of Petroleum Concession No.
4/2515/8


 


It is agreed that the Proved Natural Gas Reserves, the Probable Natural
Gas Reserves and Natural Gas produced from the above noted fields will not be
included in the calculation of Field Reserves pursuant to Article X.  In addition, Supplemental Gas Quantities
will not be included in the calculation for determining the ACQ or in the sales
and purchases for determining whether the ACQ has been met under the GSA.”


 


5. SUPPLEMENTAL GAS QUANTITIES FOR THE INTERIM PERIOD


 


The Parties agree to add the following Article XXXII to the GSA:


 


“Article XXXII
SUPPLEMENTAL GAS QUANTITIES FOR THE INTERIM PERIOD.


 


32.1                           Notwithstanding
any provision in this Agreement to the contrary, the          following provisions shall apply to that portion of Sales
Gas, which are Supplemental Gas Quantities. Such Supplemental Gas  Quantities shall not be considered
“Supplementary Gas” under Article  6.17.  Should there be any conflict between the
provisions of this  Article XXXII and
the provisions contained elsewhere in this Agreement the provisions of this
Article XXXII shall prevail.


 

















 


32.2                           During the Interim Period,
PTT agrees to purchase additional volumes of Sales Gas amounting to at least
fifty-eight decimal two eight Billion Cubic Feet (58.28 Bcf) in accordance with
the Sixth Schedule attached hereto. Such additional gas shall be nominated and
purchased by PTT after it nominates and purchases the GSA Quantities.


 


32.3                           Agreement between the
Parties regarding the purchase and sale of Supplemental Gas Quantities pursuant
to  this Article XXXII shall be for the
Interim Period.  The parties agree that
from 6 a.m. October 1st, 2001 to 6 a.m. November 1st, 2001, neither PTT’s obligations
under the provisions of Article 32.4, nor the Concessionaire’s obligations
under Article 32.7 shall be effective.


 


32.4                           In addition to events which
allow reduced purchases described elsewhere in this Agreement such as Force
Majeure, Supplemental Shortfall or maintenance,  PTT is entitled to take Supplemental Gas Quantities in an amount
less than 75% of the Supplemental DAQ for no more than twenty (20) days during
each Contract Year.


 


32.5                           If at the end of each
Contract Year, PTT has not taken Supplemental Gas Quantities at least equal to
32.5(i) below reduced by the quantities associated with 32.5(ii) below:


 


(i)                                     75% of the sum of
the Supplemental DAQ’s for such Contract Year


 


(ii)                                  the Supplemental Gas
Quantities not taken due to Force Majeure events, Supplemental Shortfall Gas
and Concessionaire’s maintenance


 


then Concessionaire shall render to PTT an invoice on or before the
thirty-first (31st) of October of such year for the difference
between 32.5(i) and the sum of 32.5(ii) above and 32.5(iii) below:


 


(iii)                               the Supplemental Gas
Quantities actually taken during such Contract Year.


 


The formula for such invoice is illustrated
below:


 


Invoice Amount = 32.5(i) — [32.5(ii) +
32.5(iii)]


 


PTT shall pay the Concessionaire on or before the thirtieth (30th)
of November of the same year. The invoice shall be calculated by averaging the
prices for each Month of the Contract Year that the Interim Period was in
effect as determined under Clause 32.6 for such Supplemental Gas Quantities
that are not taken.  Payment by PTT for
Supplemental Gas Quantities not taken will provide PTT an


 

















 


entitlement to take such Supplemental Gas Quantities at a later date in
the same manner as described in Clause 6.9 above.


 


32.6                           The price to be paid by PTT
for the Supplemental Gas Quantities shall be 88% of the Current Price.


 


32.7                           PTT may nominate up to 105%
of the Total Supplemental DAQ, as shown in the Sixth Schedule on any day.  If, at any time, Concessionaire fails to
deliver enough Sales Gas during the Interim Period so that Supplemental
Shortfall Gas occurs, then the Concessionaires shall pay to PTT, by means of a
credit against the next payment due by PTT to the Concessionaires pursuant to
this Agreement, for the Supplemental Shortfall Gas an amount equal to 12% of
the Current Price in effect at the time of the Supplemental Shortfall Gas
occurrence times the Supplemental Shortfall Gas.  If the Sales Gas produced in any month is insufficient to fully
satisfy Concessionaire’s Supplemental Shortfall Gas obligations for the
preceding month, the excess Supplemental Shortfall Gas obligations for such
month shall be accrued and carried over to the following month, and from month
to month to the end of the Contract Year, any outstanding Supplemental
Shortfall Gas obligations remaining shall be applied as a credit against PTT’s
annual payment obligations under Articles 6.8 or 32.5.  At such time, the excess amounts owed by
Concessionaire for such Supplemental Shortfall Gas will be credited against any
amounts owed by PTT to Concessionaires for natural gas not taken by PTT
pursuant to Clause 32.5 above in the same manner as such calculations are made
for GSA Quantities of Sales Gas and any additional amounts still owing to PTT
after such offsets shall be paid in cash at that time.  For the avoidance of doubt, the Shortfall
provisions of Article 15.2 will apply to any shortfall between one hundred
forty-three decimal seventy-five (143.75) million Cubic Feet per Day and one
hundred forty-five (145) million Cubic Feet per Day.


 


32.8                           The
following principles are agreed:


 


(i)  Supplemental Gas Quantities
shall not be included in the  
calculation of DCQ or ACQ pursuant to Article VI or Field Reserves
pursuant to Article X.


 


(ii)  the provisions of Article
XV related to Shortfall and Concessionaire’s failure to deliver Sales Gas will
remain in effect but shall be applicable only to GSA Quantities of Sales Gas.


 

















 


(iii)  Supplemental Gas
Quantities taken by PTT shall not be included in the calculation of
Carry-Forward Gas pursuant to Clause 6.8, nor shall Carry Forward Gas be
applied against PTT’s obligation to take Supplemental Gas Quantities.


 


32.9                           Without accruing any
obligations to pay for Supplemental Shortfall Gas under Article 32.7 or
Shortfall Gas under Article 15.2 during 2002, the Concessionaire may conduct
the preventative maintenance and facilities upgrade work not more than two
times during the year 2002 and the aggregate period for such maintenance and
upgrade work shall not exceed thirty (30) days. Concessionaire shall update PTT
from time to time of its anticipated period(s) for such maintenance and upgrades.  Concessionaire shall then designate, at
least one week in advance, the date of commencement of the actual period(s)
during which it shall claim the benefits of this Article 32.9.


 


32.10                     The Parties will attempt to
negotiate in good faith a mutually acceptable firm long-term sales/purchase
agreement for additional Natural Gas quantities from the Concession Area to
commence upon the termination of the Interim Period.  If the Parties are unable to reach agreement on a long-term sales
arrangement for incremental gas supplies, the following options will apply:


 


(i)                                     Both
Parties may elect to continue sales/purchases of Supplemental Gas Sales on a
month-to-month basis at the latest Supplemental DAQ in effect unless the
Parties mutually agree to a different Supplemental DAQ with the other
provisions of this Article XXXII continuing to apply mutatis mutandis.


 


(ii)                                  Either
Party may elect to terminate sales/purchases of Supplemental Gas Quantities
with ninety (90) days prior written notice and sales at the GSA Quantity will
continue to be in full force and effect.”


 


6. Sixth Schedule — Supplemental Gas Quantities


 


The attached schedule titled “Sixth Schedule — Supplemental Gas
Quantities” shall be added to the GSA. Such Schedule includes agreed figures
for the Supplemental DAQ and the Total Supplemental DAQ for each of the periods
through February 2004.


 

















 


7. Concessionaire’s Reservations Applicable to all Natural Gas
Production


 


Revise the first line of Clause 7.2. of the GSA by deleting the words
“from the Reservoir”.


 


8. Revision of First Amendment


 


Clause 5. of the First Amendment shall be revised and the word
“Concessionaire” shall be replaced with “Concession”.


 


9. Conflict 


 


The provisions of this Second Amendment shall constitute an amendment
and supplement to the GSA and the First Amendment.  To the extent that there is any conflict or inconsistency between
the terms of the GSA and the First Amendment with the terms of this Second
Amendment, the terms of this Second Amendment shall prevail.


 


10. GSA Remains in Effect


 


Except as amended hereby the GSA and the First Amendment shall      remain in full force and effect.


 


11. Applicable Law


 


This Second
Amendment shall be governed by and construed in accordance with the laws of
Thailand.


 


12. Effective Date


 


This Second
Amendment shall be effective from October 1, 2001.


 

















 


IN WITNESS WHEREOF each party hereto has caused this Agreement to be
executed by its duly authorized representatives as of the date first written
above.


 


 


	
  PTT Public Company Limited

  	
   

  	
  Witness:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/  VISET CHOOPIBAN

  	
   

  	
   

  	
  /s/  PRASERT BUNSUMPUN

  	
   

  
	
  Mr. Viset Choopiban

  	
   

  	
  Mr. Prasert Bunsumpun

  
	
  President

  	
   

  	
  Senior Executive Vice President

  
	
   

  	
   

  	
  Gas Business Group

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Chevron Offshore (Thailand) Limited

  	
   

  	
  Witness:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/  ISIKELI REUBEN TAUREKA

  	
   

  	
   

  	
  /s/ ANEK
  LAWANPRASERT

  	
   

  
	
  Mr. Isikeli Reuben Taureka

  	
   

  	
  Mr. Anek Lawanprasert

  
	
  Managing Director

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/  EDWARD STUART JOHNSON

  	
   

  	
   

  	
   

  
	
  Mr. Edward Stuart Johnson

  	
   

  	
   

  
	
  Director

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Thaipo Limited

  	
   

  	
  Witness:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/  KEVIN HERRMANN

  	
   

  	
   

  	
  /s/  EDWARD STUART JOHNSON

  	
   

  
	
  Mr. Kevin Herrmann

  	
   

  	
  Mr. Edward Stuart Johnson

  
	
  Resident Manager

  	
   

  	
   

  
								



 

















 


	
  Palang
  Sophon Limited

  	
   

  	
  Witness:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/  PRAPAVADEE SOPHONPANICH

  	
   

  	
   

  	
  /s/  KEVIN HERRMANN

  	
   

  
	
  Ms. Prapavadee Sophonpanich

  	
   

  	
  Mr. Kevin Herrmann

  
	
  Director

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/  ISIKELI REUBEN TAUREKA

  	
   

  	
   

  	
   

  
	
  Mr. Isikeli Reuben Taureka

  	
   

  	
   

  
	
  Director

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  B8/32 Partners Limited

  	
   

  	
  Witness:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/  KEVIN HERRMANN

  	
   

  	
   

  	
  /s/  PRAPAVADEE SOPHONPANICH

  	
   

  
	
  Mr. Kevin Herrmann

  	
   

  	
  Ms. Prapavadee Sophonpanich

  
	
  Director

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/  ISIKELI REUBEN TAUREKA

  	
   

  	
   

  	
   

  
	
  Mr. Isikeli Reuben Taureka

  	
   

  	
   

  
	
  Director

  	
   

  	
   

  
								



 

















 


SIXTH
SCHEDULE


QUANTITIES DURING INTERIM PERIOD


 


	
  1

  	
   

  	
  2

  	
   

  	
  3

  
	
  Period

  	
   

  	
  Supplemental

  DAQ

  (MMcf per day)

  	
   

  	
  Total Supplemental

  DAQ

  (GSA Quantities plus

  Supplemental DAQ)

  (MMcf
  per day)

  
	
  October 2001 – November 2001

  	
   

  	
  55

  	
   

  	
  200

  
	
  December 2001

  	
   

  	
  45

  	
   

  	
  190

  
	
  January 2002

  	
   

  	
  35

  	
   

  	
  180

  
	
  February 2002

  	
   

  	
  45

  	
   

  	
  190

  
	
  March 2002 – September 2002

  	
   

  	
  55

  	
   

  	
  200

  
	
  Contract Year 2001
  / 2002

  	
   

  	
  18.865 Bcf

  	
   

  	
   

  
	
  October 2002 – February 2003

  	
   

  	
  55

  	
   

  	
  200

  
	
  March 2003 – September 2003

  	
   

  	
  85

  	
   

  	
  230

  
	
  Contract Year 2002
  / 2003

  	
   

  	
  26.495 Bcf

  	
   

  	
   

  
	
  October 2003 – February 2004

  	
   

  	
  85

  	
   

  	
  230

  
	
  Contract Year 2003
  / 2004

  	
   

  	
  12.920 Bcf

  	
   

  	
   

  
	
  Total

  	
   

  	
  58.280 Bcf

  	
   

  	
   

  



 


Note:  The volumes specified in the column titled
“Total Supplemental DAQ” are for illustrative purposes only.  The calculation of Total Supplemental DAQ
assumes GSA Quantities of 145 MMcf per day. 
The actual Total Supplemental DAQ may vary depending on the then current
GSA Quantities for the relevant period.