Exhibit 10.1 Skene field sale agreement


    
      

    


    CONFORMED
      COPY

    


    Exhibit
      10.1

    


    Dated
      6th August 2005

    


    


    


    


    


    


    


    


    KERR-MCGEE
      NORTH SEA (U.K.) LIMITED

    


    


    


    


    


    


    CENTRICA
      RESOURCES LIMITED

    


    


    


    


    


    


    


    


    


    
      
        

      



    AGREEMENT
      FOR THE SALE AND 

    PURCHASE
      OF THE SKENE FIELD ASSETS

    


    
      
        

      

    

     

     

     

     

     

     

     

    
 

    


    
      
         

      

      
         

        
          

        

      

      
         

        
        

      

    



    CONTENTS

     

    


     

    
      	
              CLAUSE

               

            	 	
              PAGE

               

            
	
              1.

               

            	
              DEFINITIONS
                AND INTERPRETATION.........................................

               

            	
              1

               

            
	
              2.

               

            	
              SALE
                AND PURCHASE..............................................................

               

            	
              9

               

            
	
              3.

               

            	
              CONSIDERATION.....................................................................

               

            	
              9

               

            
	
              4.

               

            	
              COMPLETION..........................................................................

               

            	
              10

               

            
	
              5.

               

            	
              KERR-MCGEE
                WARRANTIES AND LIMITATIONS..........................

               

            	
              11

               

            
	
              6.

               

            	
              THE
                BUYER’S WARRANTIES.....................................................

               

            	
              13

               

            
	
              7.

               

            	
              CONDUCT
                OF CLAIMS..............................................................

               

            	
              14

               

            
	
              8.

               

            	
              COMPLETION
                ADJUSTMENTS....................................................

               

            	
              15

               

            
	
              9.

               

            	
              INFORMATION,
                RECORDS AND ASSISTANCE POST

              COMPLETION...................................................................................................

               

            	
               

              19

               

            
	
              10.

               

            	
              TAXATION..............................................................................

               

            	
              19

               

            
	
              11.

               

            	
              TRANSITION
                PERIOD................................................................

               

            	
              19

               

            
	
              12.

               

            	
              INDEMNITY.............................................................................

               

            	
              21

               

            
	
              13.

               

            	
              INTEREST
                ON LATE PAYMENT...................................................

               

            	
              24

               

            
	
              14.

               

            	
              COSTS....................................................................................

               

            	
              24

               

            
	
              15.

               

            	
              CONFIDENTIALITY..................................................................

               

            	
              24

               

            
	
              16.

               

            	
              ANNOUNCEMENTS..................................................................

               

            	
              25

               

            
	
              17.

               

            	
              MISCELLANEOUS.....................................................................

               

            	
              25

               

            
	
              18.

               

            	
              ENTIRE
                AGREEMENT................................................................

               

            	
              26

               

            
	
              19.

               

            	
              FURTHER
                ASSURANCE..............................................................

               

            	
              27

               

            
	
              20.

               

            	
              NOTICES.................................................................................

               

            	
              28

               

            
	
              21.

               

            	
              GOVERNING
                LAW AND JURISDICTION........................................

               

            	
              28

               

            


    

    


    
      	
              SCHEDULE
                1 KERR-MCGEE WARRANTIES..................................................

            	
              30

            


    

    


    
      	
              1.

            	
              Licences,
                Assets and Asset Documents...............................................

            	
              30

            
	
              2.

            	
              Charges....................................................................................

            	
              32

            
	
              3.

            	
              Litigation..................................................................................

            	
              32

            
	
              4.

            	
              Kerr-McGee..............................................................................

            	
              32

            


    

    


    
      	
              SCHEDULE
                2 THE BUYER WARRANIES.......................................................

            	
              33

            
	
              SCHEDULE
                3 LIMITATIONS ON LIABILITY.................................................

            	
              34

            


    

    


    
      	
              1.

            	
              Time
                Limits..............................................................................

            	
              34

            
	
              2.

            	
              Thresholds
                for claims...................................................................

            	
              34

            
	
              3.

            	
              Claim
                to be withdrawn unless litigation commenced..............................

            	
              34

            
	
              4.

            	
              Maximum
                limit for all claims.........................................................

            	
              34

            


       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      
        	
                5.

              	
                Matters
                  disclosed or taken into account in adjustment.............................

              	
                35

              
	
                6.

              	
                Contingent
                  Liabilities...................................................................

              	
                35

              
	
                7.

              	
                No
                  liability for claims arising from acts or omissions of
                  Buyer..................

              	
                35

              
	
                8.

              	
                Nothing
                  to restrict buyer’s duty to mitigate..........................................

              	
                35

              
	
                9.

              	
                Claims
                  by buyer under insurance.....................................................

              	
                36

              
	
                10.

              	
                Claims
                  which would have been covered by kerr-mcgee’s
                  insurance............

              	
                36

              
	
                11.

              	
                No
                  liability for legislation or changes in rates of
                  tax...............................

              	
                36

              
	
                12.

              	
                No
                  double recovery.....................................................................

              	
                36

              
	
                13.

              	
                Waiver
                  of right of set off...............................................................

              	
                36

              
	
                14.

              	
                Kerr-McGee
                  to have opportunity to remedy breaches..............................

              	
                37

              
	
                15.

              	
                Sums
                  or benefits received by buyer...................................................

              	
                37

              
	
                16.

              	
                Recovery
                  from third parties............................................................

              	
                37

              


      

    

    


    
      	
              SCHEDULE
                4 ASSET DOCUMENTS.............................................................

               

            	
              39

               

            
	
              SCHEDULE
                5 COMPLETION ADJUSTMENTS................................................

            	
              40

            


    

    


    
      	
              1.

            	
              General....................................................................................

            	
              40

            
	
              2.

            	
              Working
                Capital Adjustment..........................................................

            	
              40

            
	
              3.

            	
              Billed
                Invoice Adjustment.............................................................

            	
              41

            
	
              4.

            	
              NPR
                Adjustment.........................................................................

            	
              42

            
	
              5.

            	
              Petroleum
                Sales Adjustment............................................................

            	
              42

            
	
              6.

            	
              Interest
                Adjustment......................................................................

            	
              42

            
	
              7.

            	
              Taxation
                Adjustment....................................................................

            	
              42

            
	
              8.

            	
              Interest....................................................................................

            	
              42

            


    

    


    
      	
              EXHIBIT
                1 PROFORMA COMPLETION STATEMENT.....................................

               

            	
              43

               

            
	
              SCHEDULE
                6 LIST OF COMPLETION DOCUMENTS.......................................

               

            	
              44

               

            
	
              SCHEDULE
                7 THE ASSETS........................................................................

               

            	
              68

               

            
	
              SCHEDULE
                8 TAXATION..........................................................................

            	
              69

            


    

    


    
      	
              PART
                1

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

            	
              69

            
	
              1.

            	
              Allocation
                of Consideration............................................................

            	
              69

            
	
              2.

            	
              Petroleum
                Revenue Tax Compliance.................................................

            	
              70

            
	
              3.

            	
              Taxation
                Adjustment....................................................................

            	
              70

            
	
              4.

            	
              Interim
                Period: Corporation Tax Adjustment.......................................

            	
              71

            
	
              5.

            	
              Working
                Capital Balance Sheet: Tax Adjustments.................................

            	
              72

            
	
              6.

            	
              Interim
                Period: Petroleum Revenue Tax Adjustment..............................

            	
              73

            
	
              7.

            	
              Schedule
                15..............................................................................

            	
              74

            
	
              8.

            	
              Value
                Added Tax........................................................................

            	
              74

            
	
              9.

            	
              Stamp
                Duty Land Tax..................................................................

            	
              75

            
	
              10.

            	
              Information..............................................................................

            	
              75

            
	
              11.

            	
              Time
                Limit...............................................................................

            	
              75

            
	 	 	 
	
              PART
                2

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

            	
              75

            


    

    


    
      	
              SCHEDULE
                9 BUYER PARENT COMPANY GUARANTEE................................

               

            	
              76

               

            


    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    THIS
      AGREEMENT is
      made this 6th day of August 2005

     

    Between:

     

    	(1)  	
            Kerr-McGee
              North Sea (U.K.) Limited
              a company incorporated in England and having its registered office
              at 55
              Grosvenor Street, London W1K 3HY (Kerr-McGee);

          


     

    	(2)  	
            Centrica
              Resources Limited
              a company incorporated in England and having its registered office
              at
              Millstream, Maidenhead Road, Windsor, Berkshire SL4 5GD (the Buyer);

          


     

     

    Whereas:

     

    (A)  Kerr-McGee
      wishes to sell and the Buyer wishes to purchase the Assets (as hereinafter
      defined).

     

    (B)  The
      Parties wish to set out herein the terms and conditions upon which the aforesaid
      sale and purchase shall take place.

     

    Now
      therefore it is hereby agreed as
      follows:

     

    1.  Definitions
      and Interpretation

     

    1.1  In
      this Agreement, the following expressions shall, except where the context
      otherwise requires, have the following meanings:

     

    Accrual
      Basis of Accounting means
      the basis of accounting under which costs and benefits are regarded as
      applicable to the period in which the liability to the cost is incurred or
      the
      right to the benefit arises regardless of when invoiced, paid or
      received;

     

    Adjustment
      has
      the meaning given in clause 8.1;

     

    Adjustment
      Clauses has
      the meaning given in clause 8.1;

     

    Administrator
      means
      UKCS Administrator Limited;

     

    Affiliate
      means:

     

    	(a)  	
            if
              the Party is a subsidiary of another company, the Party’s ultimate holding
              company and any subsidiary (other than the Party itself) of the Party’s
              ultimate holding company; or

          


     

    	(b)  	
            if
              the Party is not a subsidiary of another company, any subsidiary of
              the
              Party.

          


     

    For
      the purpose of this definition holding company and subsidiary shall have the
      meanings given to those expressions in Section 736 of the Companies Act 1985,
      as
      amended by Section 144 of the Companies Act 1989;

     

    
      
         

      

      
        1

        
          

        

      

      
         

      

    

    Asset
      Data means
      all data, reports and other information held by Kerr-McGee relating directly
      to
      the Assets and forming part of the property jointly owned by Kerr-McGee and
      the
      other parties to an Operating Agreement in accordance with its terms, but
      excluding all internal communications within Kerr-McGee and between Kerr-McGee
      and its Affiliates and internal memoranda, reports, interpretations and
      documents created for Kerr-McGee’s (or its Affiliates’) own use and excluding
      Traded Data and the Asset Documents;

     

    Asset
      Documents means
      the deeds, agreements, licences, letters and other documents specified in
Schedule 4;

     

    Asset
      Property means
      all of the property related to the Assets including, but not limited to
      platforms, pipelines, plant, machinery, wells, facilities and all other offshore
      and onshore installations and structures and all items taken into account in
      Schedule 5;

     

    Assets
      means
      the interests set out in Schedule 7,
      including, but without limitation, such interest in the Asset Property and
      the
      Asset Data, and the Asset Documents;

     

    Assignment
      Documents means
      the execution deeds in the form as attached as first annex to Schedule 2 to
      the
      Master Deed dated 28 April 2003 in respect of the transfers contemplated under
      this Agreement, as further detailed in Schedule 6;

     

    Base
      Consideration means
      one hundred and seventy-eight million and six hundred and fifty thousand United
      States Dollars (US $178,650,000);

     

    Benefits
      means
      all income, receipts, rebates, assets and other amounts or benefits calculated
      on an Accrual Basis of Accounting in connection with or arising out of the
      Assets (including in respect of tax);

     

    Billed
      Invoice Adjustment has
      the meaning given in Schedule 5;

     

    Block
      means
      a block on the United Kingdom Continental Shelf as shown on the reference map
      deposited at the principal office of the Department of Trade and Industry in
      London;

     

    Business
      Day means
      a day, other than a Saturday or Sunday, on which banks are or, as the context
      may require, were generally open for normal business in London and New
      York;

     

    the
      Buyer’s Account means
      a bank account to be notified by the Buyer to Kerr-McGee not later than two
      (2)
      Business Days prior to the Completion Date;

     

    Buyer
      Group means
      the Buyer and its Affiliates from time to time;

     

    Buyer
      Parent Company Guarantee means
      the guarantee by Centrica plc in the agreed form as set out in Schedule 9;

     

    Buyer
      Warranties means
      the warranties set out in Schedule 2;

     

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    Buyer
      Warranty Claims means
      any claim against the Buyer for breach of the Buyers Warranties;

     

    Chargeable
      Period means
      for Petroleum Revenue Tax a period of six months ending at the end of June
      or
      December and for Corporation Tax means a Corporation Tax Accounting
      Period;

     

    Claim
      means
      any claim by the Buyer or its Affiliates under or for breach of this Agreement
      (other than under clauses 8
      and 12
      of this Agreement, save as expressly provided therein), including, without
      limitation, any Kerr-McGee Warranty Claim;

     

    Completion
      means
      the fulfilment by the Parties of their respective obligations pursuant to
      clause 4.1;

     

    Completion
      Date means
      the date occurring five (5) Business Days after satisfaction or waiver of the
      last of the Conditions Precedent (provided that the Conditions Precedent remain
      satisfied on such date or have been waived) or such other date as shall be
      agreed between the Parties;

     

    Completion
      Documents means
      the Assignment Documents and other documentation necessary to give effect to
      the
      terms of this Agreement (a list of which is set out in Schedule 6),
      each in a form to be agreed between Kerr-McGee and the Buyer, such agreement
      not
      to be unreasonably withheld or delayed;

     

    Completion
      Venue means
      the offices of Freshfields Bruckhaus Deringer, 65 Fleet Street, London, EC4Y
      1HS
      or such other location as the Parties may agree;

     

    Conditions
      Precedent means
      the conditions listed in clause 2.2;

     

    Confidentiality
      Agreement has
      the meaning given in clause 15.2;

     

    Connected
      Persons means
      (in relation to Kerr McGee or the Buyer) any of its Affiliates or any of the
      officers, employees, agents and advisers of that Party or any of its
      Affiliates;

     

    Corporation
      Tax or
      CT
      means
      corporation tax as charged under the Income and Corporation Taxes Act 1988
      (as
      amended from time to time) and includes the supplementary charge (SCT) imposed
      by 501A of that Act arising in respect of profits from ring fence trades in
      accordance with section 502 of the same Act;

     

    Corporation
      Tax Accounting Period means
      an accounting period as defined under Section 12 of the Income and Corporation
      Taxes Act 1988 (as amended from time to time);

     

    Data
      Room means
      the Data Room relating to the Assets comprising the information made available
      to the Buyer and its advisers referred to in the Disclosure Letter;

     

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    Decommissioning
      Liabilities means
      any and all claims, costs, charges, expenses, liabilities or obligations
      incurred in relation to decommissioning, abandonment, removing, or making safe
      all of the Asset Property (including platforms, pipelines, plant, machinery,
      wells (including well cuttings), facilities and all other offshore and onshore
      installations and structures) whether such claims, costs, charges, expenses,
      liabilities or obligations are incurred under or pursuant to any of the Asset
      Documents or under statutory obligation, common law, international law,
      international convention or any other obligation including any decommissioning
      plans or IMO Guidelines and Standards or regulations under OSPAR Decision 98/3
      or any subsequent decisions of OSPAR and including any residual liability for
      anticipated or necessary continuing insurance, maintenance and monitoring
      costs;

     

    Disclosure
      Letter means
      the letter of even date herewith to the Buyer from Kerr-McGee entitled Skene
      Assets Disclosure Letter as amended pursuant to clause 5.5;

     

    Disputed
      Amounts has
      the meaning given in clause 8.4;

     

    Effective
      Date means
      00.01 hours (London time) on 1 July 2005;

     

    Environment
      means
      all or any of the following, alone or in combination, the air (including the
      air
      within buildings and the air within any other natural or man-made structures
      above or below ground or above or below water), water (including seawater inside
      or outside any territorial limits, freshwater and water under or within land
      or
      in pipes or sewerage systems), soil and land (including the seabed, subsoil
      and
      land under water) flora, fauna, fish and any ecological systems and living
      organisms supported by those media including man;

     

    Environmental
      Law means
      all European Union law, international treaties, national, federal, provincial,
      state or local statutes or regulations, the common law, and any codes and
      conventions of law (having legal effect), from time to time, in any relevant
      jurisdiction including any guidelines, notes for industry on decommissioning
      offshore installations and pipelines made under the Petroleum Act 1998 or other
      relevant legislation and decommissioning programmes in effect from time to
      time
      concerning:

     

    	(a)  	
            harm
              or damage to or protection of the Environment or the provision of remedies
              in respect of or compensation for harm or damage to the
              Environment;

          


     

    	(b)  	
            emissions,
              discharges, releases or escapes into or the presence in the Environment
              of
              Hazardous Substances or the production, processing, management, treatment,
              storage, transport, handling or disposal of Hazardous Substances or
              the
              disposal or abandonment of any oil
              platform;

          


     

    	(c)  	
            worker
              or public health and safety; or

          


     

    	(d)  	
            decommissioning,
              abandonment, removing or making safe any property (including platforms,
              pipelines, plant, machinery, wells (including well cuttings), facilities
              and all other offshore and onshore installations and
              structures),

          


     

    and
      any bylaws, regulations or subordinate legislation, judgements, decisions,
      notices, orders, circulars, technical instructions, licences or permits and
      codes of practice issued or made thereunder from time to time;

     

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    Environmental
      Liabilities means
      any and all claims, costs, charges, expenses, liabilities or obligations in
      respect of the Assets under any Environmental Law or in relation to cleaning
      up,
      decontamination of, removing and disposing of debris or any property (including
      platforms, pipelines, plant, machinery, wells (including well cuttings),
      facilities and all other offshore and onshore installations and structures)
      from
      and for reinstating any area of land, foreshore or seabed, wherever situated,
      whether such claims, costs, charges, expenses, liabilities or obligations are
      incurred under or pursuant to any of the Asset Documents or under any
      Environmental Law or any other obligation and including any residual liability
      for anticipated or necessary continuing insurance, maintenance and monitoring
      costs;

     

    Exchange
      Rate means
      the closing mid-point spot exchange rate for the applicable currency against
      United States Dollars as quoted in the London Financial Times published one
      (1)
      Business Day prior to the date on which the relevant payment is due or receipt
      occurs;

     

    Final
      Completion Statement means
      the final completion statement referred to in clause 8.4;

     

    HMRC
      means
      Her Majesty’s Revenue and Customs;

     

    Hazardous
      Substances means
      any wastes, pollutants, contaminants and any other natural or artificial
      substances (whether in the form of a solid, liquid, gas or vapour, and whether
      alone or in combination) or contained in any pipes, cables, containers,
      structures, plant or equipment which are capable of causing harm or damage
      to
      the Environment;

     

    IMO
      Guidelines and Standards means
      the International Maritime Organisation Guidelines and Standards for the Removal
      of Offshore Installations and Structures on the Continental Shelf and in the
      Exclusive Economic Zone;

     

    Interim
      Completion Statement has
      the meaning given in clause 8.3(b);

     

    Interim
      Net Adjustment Amount has
      the meaning given in clause 8.3(a);

     

    Interest
      Adjustment
      has the meaning given in Schedule 5;

     

    Interim
      Period means
      the period from and including the Effective Date up to and excluding the
      Completion Date;

     

    Joint
      Account means
      any joint account held by the relevant Operator in accordance with the
      appropriate Operating Agreement or Unit Agreement;

     

    Joint
      Venture Billings means
      any billings issued by the relevant Operator in accordance with the appropriate
      Operating Agreement or Unit Agreement;

     

    Kerr-McGee’s
      Account means
      the account nominated by Kerr-McGee not less than 2 Business Days prior to
      Completion;

     

    Kerr-McGee
      Group means
      Kerr-McGee and its Affiliates from time to time;

     

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    Kerr-McGee
      Guarantees has
      the meaning given in clause 12.11;

     

    Kerr-McGee
      Warranties means
      the warranties set out in Schedule 1;

     

    Kerr-McGee
      Warranty Claim means
      any claim against Kerr-McGee for breach of the Kerr-McGee
      Warranties;

     

    Licences
      means
      United Kingdom Petroleum Production Licences as detailed in Schedule 4
      and, where the context so admits, any one or more of such Licences;

     

    Longstop
      Date has
      the meaning given in clause 2.5;

     

    Losses
      and Expenses means
      actions, proceedings, losses, damages, liabilities (including in respect of
      tax), claims, demands, costs and expenses including fines, penalties, clean-up
      costs, legal and other professional fees and any VAT payable in relation to
      any
      such matter, circumstances or item;

     

    Net
      Adjustment Amount means
      the cash amount expressed in US Dollars to be calculated by adding together
      all
      the relevant Adjustments in accordance with clause 8,
      and which, if positive, shall increase the Base Consideration and, if negative,
      shall reduce the Base Consideration;

     

    Nominated
      Independent Accountant has
      the meaning given in clause 8.7;

     

    NORM
      has
      the meaning given in clause 12.7;

     

    NPR
      Adjustment has
      the meaning set out in Schedule 5;

     

    Objection
      Notice has
      the meaning given in clause 8.4;

     

    Obligations
      means
      all costs, charges, expenses, liabilities and obligations calculated on an
      Accrual Basis of Accounting in connection with or arising out of the Assets
      (including in respect of tax) (but other than Environmental Liabilities and
      Decommissioning Liabilities);

     

    Operator
      means
      the operator under the relevant Operating Agreements or Unit Agreements (as
      the
      case may be);

     

    Operating
      Agreements means
      the operating agreements more particularly described in Schedule 4,
      and where the context so admits, any one or more of such
      agreements;

     

    Party
      means
      Kerr-McGee or the Buyer and Parties
      means
      both of them;

     

    Petroleum
      has
      the meaning ascribed thereto in the Licences;

     

    Petroleum
      Sales Adjustment has
      the meaning set out in Schedule 5;

     

    Petroleum
      Revenue Tax or
      PRT
      means
      petroleum revenue tax as imposed by the Oil Taxation Act 1975 and the Oil
      Taxation Act 1983;

     

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

    Pounds
      Sterling or
      £
      means the lawful currency of the United Kingdom from time to time;

     

    Records
      has
      the meaning set out in clause 9;

     

    Reference
      Interest Rate means
      the rate quoted by the Royal Bank of Scotland to prime banks in the London
      Interbank Market at or about 11.30 a.m. British Standard Time for one (1) month
      deposits in United States Dollars in the amount (or as close an amount thereto
      as is practicable) of the sum due but unpaid. In respect of any date which
      is
      not a Business Day, the rate set for the immediately preceding Business Day
      shall apply;

     

    Schedules
      means
      the schedules to this Agreement;

     

    SDLT
      means
      stamp duty land tax (as referred to in Section 42 of the Finance Act 2003)
      together with any interest and penalties thereon;

     

    Secretary
      of State means
      the Minister as defined from time to time under the Licences;

     

    Secretary
      of State Consents means
      the approval of the Secretary of State to the transactions contemplated by
      this
      Agreement and such of the Completion Documents as is appropriate, including
      the
      consent of the Secretary of State to the assignment of the Licences relating
      to
      the Assets;

     

    tax
      means
      (a) taxes on income, profits and gains, and (b) all other taxes, levies, duties,
      imposts, charges and withholdings in the nature of taxation, including any
      excise, property, value added, sales, transfer, franchise and payroll taxes,
      PRT, corporation tax, supplementary charge and any national insurance or social
      security contributions, together with all penalties, charges and interest
      relating to any of the foregoing or to any late or incorrect return in respect
      of any of them (and taxation
      shall
      be construed accordingly);

     

    Taxation
      Adjustment has
      the meaning set out in Schedule 5;

     

    tax
      authority means
      any taxing or other authority (whether within or outside the United Kingdom)
      competent to impose any tax liability;

     

    Total
      Consideration means
      the Base Consideration as adjusted by the Adjustments as determined pursuant
      to
      clauses 8.3
      to 8.7;

     

    Traded
      Data means
      data acquired from a third party by Kerr-McGee or its Affiliates by trade,
      purchase or otherwise which cannot be provided to the Buyer because such
      transfer is prohibited by the agreement pursuant to which it was acquired by
      Kerr-McGee or its Affiliates;

     

    Transition
      Period means
      the period between the date hereof and the Completion Date;

     

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

    Transaction
      Document means
      this Agreement, the Disclosure Letter, and the Confidentiality
      Agreement;

     

    Unit
      Agreement means
      any unit operating agreement more particularly described in Schedule 4;

     

    United States Dollars,
      Dollars,
      US$
      and $
      means the lawful currency of the United States of America from time to
      time;

     

    Value
      Added Tax or
      VAT
      means
      value added tax as imposed by the Value Added Tax Act 1994 (as amended from
      time
      to time) and any other provision or regulation including any interest and
      penalties thereon; and

     

    Working
      Capital Adjustment has
      the meaning set out in Schedule 5.

     

    1.2  All
      references to clauses and Schedules are, unless otherwise expressly stated,
      references to clauses of and schedules to this Agreement.

     

    1.3  The
      headings in this Agreement are inserted for convenience only and shall be
      ignored in construing this Agreement.

     

    1.4  Any
      reference to any statute or statutory instrument in this Agreement shall be
      a
      reference to the same as amended, supplemented or re-enacted from time to
      time.

     

    1.5  Unless
      the context otherwise requires, reference to the singular shall include the
      plural and vice versa, reference to any gender shall include all genders, and
      references to persons shall include natural persons, bodies corporate,
      unincorporated associations and partnerships.

     

    1.6  The
      Schedules form part of this Agreement and shall be construed and have the same
      force and effect as if expressly set out in the main body of this
      Agreement.

     

    1.7  Any
      reference to any agreement in this Agreement shall be a reference to the same
      as
      amended, supplemented or novated from time to time.

     

    1.8  Where
      a Kerr-McGee Warranty is qualified by the words “so far as Kerr-McGee is aware”,
      or any similar expression, such warranty is given only to the extent that any
      of
      Terence Jupp (Managing Director of Kerr-McGee), Alan Curran (Technical Director
      of Kerr-McGee), Bart Boudreaux (Drilling and Completions director), Peter
      Campbell (Manager of Business Development), Robin Baxter (Company Secretary
      and
      Legal and Commercial Manager of Kerr-McGee), Russell Boath (Financial and Tax
      Manager of Kerr-McGee) and Ian Sharp (Operations Director of Kerr-McGee) are
      actually aware of the matters to which it refers as at the date hereof (having
      made enquiries of their respective direct reports).

     

    1.9  References
      in this Agreement to the words ‘include’, ‘including’ and ‘other’ shall be
      construed without limitation.

     

    
      
         

      

      
        8

        
          

        

      

      
         

      

    

    2.  Sale
      and Purchase

     

    	2.1  	
            (a)Subject
              as herein provided, Kerr-McGee hereby agrees to sell and transfer the
              Assets free from all liens, charges, mortgages, pledges, encumbrances
              or
              security interests whatsoever relating thereto (subject to the provisions
              of the Asset Documents) to the Buyer for the consideration referred
              to in
              clause 3
              and the Buyer hereby agrees to purchase and acquire the
              Assets.

          


     

    	(b)  	
            The
              transfer referred to in clause 2.1(a)
              shall, as between the Parties, be deemed for all purposes to be made
              with
              effect on and from the Effective Date.

          


     

    2.2  The
      obligations of the Parties under clause 2.1
      and clause 4
      are conditional on the satisfaction of the following Conditions
      Precedent:

     

    	(a)  	
            the
              Secretary of State Consents having been duly obtained in a form reasonably
              satisfactory to Kerr-McGee and the Buyer;

          


     

    	(b)  	
            the
              waiver or non-exercise of any applicable pre-emption rights by all
              of the
              parties with the benefit thereof;
              and

          


     

    	(c)  	
            the
              due execution by the signatory parties (other than the Parties) or
              the
              Administrator on their behalf of the Completion Documents and the receipt
              by the Parties from the other parties to the Completion Documents of
              all
              requisite consents and approvals to the transactions contemplated by
              this
              Agreement (in a form reasonably satisfactory to the Parties).

          


     

    2.3  The
      Conditions Precedent set forth in clauses 2.2(a),
      2.2(b)
      and 2.2(c)
      may not be waived by either Party, without the written consent of the other
      Party.

     

    2.4  The
      Parties shall use all reasonable endeavours to ensure that the Conditions
      Precedent are satisfied as soon as reasonably practicable and in any event
      before the Longstop Date. The Parties shall keep each other informed of the
      progress in satisfying these conditions and the date of when they have been
      fulfilled.

     

    2.5  If
      any of the Conditions Precedent have not been satisfied or waived on or before
      four (4) months after the date of signing of this agreement (the Longstop Date),
      either the Buyer or Kerr-McGee shall have the right, after such date, to serve
      written notice on the other Party terminating this Agreement, whereupon this
      Agreement shall terminate with effect from the date of such notice and no Party
      shall have any liability to another under this Agreement except in respect
      of
      clauses 15
      and 16
      and any breach of the terms hereof committed before such date.

     

    3.  Consideration

     

    The
      consideration for the transfer of the Assets shall be the payment by the Buyer
      to Kerr-McGee of the Base Consideration as adjusted pursuant to this Agreement
      plus any VAT thereon.

     

    
      
         

      

      
        9

        
          

        

      

      
         

      

    

    4.  Completion

     

    4.1  Completion
      of the transfer of the Assets shall take place on the Completion
      Date:

     

    	(a)  	
            Kerr-McGee
              shall:

          


     

    	(i)  	
            deliver
              to the Buyer copies of the Secretary of State
              Consents;

          


     

    	(ii)  	
            deliver
              to the Buyer the Completion Documents duly executed by the signatory
              parties, other than the Parties, or the Administrator on their behalf;
              and

          


     

    	(iii)  	
            deliver
              to the Buyer a copy, certified as a true copy, of the power of attorney
              or
              written resolution of the directors of Kerr-McGee authorising the
              execution of the Completion Documents on behalf of Kerr-McGee;
              

          


     

    	(b)  	
            the
              Buyer shall:

          


     

    	(i)  	
            deliver
              to Kerr-McGee a copy, certified as a true copy, of the power of attorney
              or written resolution of the directors of the Buyer authorising the
              execution of the Completion Documents on behalf of the Buyer;
              and

          


     

    	(ii)  	
            pay
              to Kerr-McGee the Base Consideration as adjusted by the Interim Net
              Adjustment Amount by means of a direct transfer in cleared immediately
              available funds to Kerr-McGee’s Account on the Completion
              Date;

          


     

    	(iii)  	
            deliver
              to Kerr McGee the Buyer Parent Company
              Guarantee;

          


     

    	(c)  	
            the
              Parties shall execute the Completion
              Documents.

          


     

    4.2  Each
      of the Parties shall, and shall procure that its respective Affiliates shall,
      execute such other documents and do all such other acts and things as may
      reasonably be required in order to effect the transfer of the Assets to the
      Buyer and otherwise carry out the true intent of this Agreement.

     

    4.3  Kerr-McGee
      shall deliver to the Buyer the Asset Data and the Asset Documents as soon as
      practicable following the Completion Date but no later than thirty (30) days
      following the Completion Date.

     

    4.4  Without
      prejudice to Kerr McGee’s rights under clause 9,
      the Buyer acknowledges that Kerr-McGee shall have the right to make at its
      own
      expense and retain copies of any of the Asset Data and the Asset Documents,
      subject to the same being maintained in confidence in accordance with the
      provisions of clause 15.

     

    4.5  The
      Buyer undertakes that, following 30 Business Days after Completion, it shall
      not
      and it shall procure that its Affiliates shall not make use of any stationery,
      invoices, forms, seals, trade marks, logos and any other similar articles or
      symbols showing the expressions “Kerr-McGee” or any other expression likely to
      suggest a connection with the Kerr-McGee Group.

     

    
      
         

      

      
        10

        
          

        

      

      
         

      

    

    5.  Kerr-Mcgee
      Warranties and Limitations

     

    5.1  Subject
      to the provisions of this clause 5,
      Kerr-McGee hereby warrants to the Buyer in the terms set out in Schedule 1
      as at the date hereof.

     

    5.2  Subject
      to the provisions of this clause 5
      and subject to the matters notified pursuant to clause 5.5,
      Kerr-McGee’s Warranties under clauses 1.1,
      1.2,
      1.7(a),
      1.10,
      1.13,
      2,
      and 4
      of Schedule 1
      shall be repeated at Completion by reference to the facts and circumstances
      then
      existing.

     

    5.3  The
      Kerr-McGee Warranties are given subject to:

     

    	(a)  	
            any
              matters fully and fairly disclosed by or under this Agreement, the
              Disclosure Letter, any document or material contained in the Data Room
              or
              any other information provided to the Buyer or its advisers during
              the
              course of any investigation, whether authorised by Kerr-McGee or not,
              by
              or on behalf of the Buyer into the affairs of Kerr-McGee, its Affiliates
              or the Assets;

          


     

    	(b)  	
            any
              matters set forth in the Asset Documents;
              and

          


     

    	(c)  	
            the
              other limitations set out in this clause 5
              and in Schedule 3.

          


     

    5.4  The
      Buyer acknowledges and agrees that:

     

    	(a)  	
            any
              Claims shall be subject to the limitations on liabilities and other
              provisions set out in Schedule 3;

          


     

    	(b)  	
            the
              Kerr-McGee Warranties are the only warranties or representations of
              any
              kind given by or on behalf of Kerr-McGee or any of its Affiliates on
              which
              the Buyer or any of its Affiliates may rely in entering into this
              Agreement; and

          


     

    	(c)  	
            no
              other statement, promise or forecast made by or on behalf of Kerr-McGee
              or
              any of its Connected Persons may form the basis of any claim by the
              Buyer
              or any of its Connected Persons under or in connection with this Agreement
              and all responsibility for any such statement, promise or forecast
              is
              disclaimed; without limitation, the Buyer acknowledges and agrees that
              neither Kerr-McGee nor any of its Connected Persons makes any
              representation or warranty as to: (i) the accuracy of any forecasts,
              estimates, projections, statements of intent or statements of opinion
              provided to the Buyer or any of its Connected Persons or to its or
              their
              advisers on or prior to the date of this Agreement, including those
              contained in any documents in the Data Room; (ii) the accuracy of any
              information, documents or materials furnished to or for the Buyer by
              Kerr-McGee or any of its Connected Persons, including any information,
              documents or material made available to the Buyer in the Data Room,
              management presentation or any other form in expectation of the
              transactions contemplated by this Agreement provided always that this
              clause 5.4(c)
              shall not apply to any information, documents or materials the subject
              of
              the warranties set out in paragraphs 1.5
              and 1.6
              of Schedule 1;
              (iii) the amounts, quality or deliverability of reserves of crude oil,
              natural gas or other hydrocarbons attributable to the Assets; (iv)
              any
              geological, geographical, engineering, economic or other interpretations,
              forecasts or evaluations; (v) any forecast of expenditures, budgets
              or
              financial projections; (vi) any geological formation, drilling prospect
              or
              hydrocarbon reserve; or (vii) the condition, performance or operability
              of
              the Asset Property.

          


     

    
      
         

      

      
        11

        
          

        

      

      
         

      

    

    5.5  Kerr-McGee
      shall promptly notify the Buyer in writing of any circumstances, facts or
      matters which following execution of this Agreement become known to it prior
      to
      Completion which are inconsistent in any material respect with any of the
      Kerr-McGee Warranties
      provided that notwithstanding such notification the Buyer shall be obliged
      to
      complete this Agreement in accordance with its terms and provided further that
      in relation to such circumstances, facts or matters the Buyer shall have no
      Claim against Kerr-McGee to the extent that such circumstances, facts or matters
      arise after signature of this Agreement and the warranty is not a warranty
      to be
      repeated at Completion pursuant to clause 5.2.

     

    5.6  Kerr-McGee
      shall promptly notify the Buyer in writing of any circumstances, facts or
      matters which following execution of the Agreement became known to it prior
      to
      Completion or which would if subsisting at Completion be inconsistent with
      any
      of the warranties under paragraphs 1.1,
      1.2,
      1.7(a),
      1.10,
      1.13,
      2
      and 4
      of Schedule 1
      (as repeated at the Completion Date pursuant to clause 5.2). 

     

    5.7  The
      Parties agree that the Disclosure Letter shall be deemed to be amended with
      effect on and from the date of this Agreement to reflect circumstances, facts
      or
      matters notified pursuant to clause 5.5
      and 5.6.

     

    5.8  Any
      notice shall state that it is served pursuant to this clause 5.5 or 5.6 as
      the
      case may be.

     

    5.9  In
      the event that any circumstance, fact or matter (a) is notified by Kerr-McGee
      in
      accordance with clause 5.5
      or 5.6
      or (b) otherwise becomes known to the Buyer following execution of this
      Agreement which is inconsistent with the Kerr-McGee Warranties or which would
      if
      subsisting at Completion be inconsistent under paragraphs 1.1,
      1.2,
      1.7(a),
      1.10,
      1.13,
      2
      and 4
      of Schedule 1
      (as repeated at the Completion Date pursuant to clause 5.2)
      which (whether individually or in aggregate) materially affects the value of
      the
      Assets, then:

     

    	(a)  	
            if
              the inconsistency is capable of remedy, Kerr-McGee shall have the
              opportunity to remedy the same at its own expense and, if it chooses
              to
              exercise that right, it shall promptly notify the Buyer of its decision
              to
              do so and shall use reasonable endeavours to ensure remedy of the
              inconsistency as soon as practicable;

          


     

    	(b)  	
            if
              the inconsistency has not been so remedied not less than three (3)
              Business Days prior to the Completion Date, Kerr-McGee and the Buyer
              shall
              discuss the effects on the value of the Assets and whether the terms
              hereof could be amended to take account of any such change in
              circumstance, fact or matter;

          


     

    
      
         

      

      
        12

        
          

        

      

      
         

      

    

    	(c)  	
            subject
              to clause 5.9(a)
              and 5.9(b)
              and in the absence of agreement between Kerr-McGee and the Buyer not
              less
              than one (1) Business Day prior to the Completion Date, the Buyer shall
              not be obliged to complete the acquisition of the Assets and shall
              be
              entitled by notice in writing to Kerr-McGee prior to Completion to
              rescind
              this Agreement; and

          


     

    	(d)  	
            in
              the circumstances contemplated by this clause 5.9,
              such rights shall be the Buyer’s only remedy and whether or not the Buyer
              chooses to rescind this Agreement pursuant to clause 5.9(c)
              it shall not be entitled to make any claim for breach of warranty in
              respect of the circumstance, fact or matter notified or to any other
              remedy in respect thereof.

          


     

    For
      the purposes of this clause 5.9,
      the value of the Assets shall only be deemed to be materially affected if
      reduced by an amount equivalent to 15% of the Base Consideration or
      more.

     

    5.10  In
      the event that any such circumstance, fact or matter so notified or becoming
      known would not (whether individually or in the aggregate) materially affect
      the
      value of the Assets as defined in clause 5.9,
      the provisions of clause 5.9(a)
      and 5.9(b)
      shall apply but subject to clause 5.9(a)
      and 5.9(b)
      and in the absence of agreement between Kerr-McGee and the Buyer prior to
      Completion, the Buyer shall be obliged to complete the transaction and its
      right
      to make any claim for breach of warranty in respect of the circumstances, fact
      or matter notified or any other remedy in respect thereof shall be preserved
      and
      shall subsist notwithstanding completion of the transaction and amendment to
      the
      Disclosure Letter pursuant to clause 5.7.

     

    5.11  The
      Buyer warrants to Kerr-McGee that there are no circumstances, facts or matters
      within the actual knowledge at the date hereof of the Buyer or its Affiliates,
      financial or legal advisors which entitle the Buyer to make any Kerr-McGee
      Warranty Claim against Kerr-McGee and, insofar as there are any such
      circumstances, facts or matters within the actual knowledge at the date hereof
      of the Buyer or its Affiliates, financial or legal advisors, the Buyer shall
      not
      be entitled to make any Kerr-McGee Warranty Claim in respect
      thereof.

     

    5.12  The
      Buyer undertakes to Kerr-McGee (for the Buyer itself and as agent for each
      of
      its Connected Persons) that, except in the case of fraud or fraudulent
      misrepresentation, it waives and shall not make any claim against any Connected
      Persons of Kerr-McGee on whom it may have relied in relation to any information
      supplied or omitted to be supplied by any such person in connection with this
      Agreement.

     

    5.13  None
      of the limitations in this clause 5
      or in clause 12.12
      or in Schedule 3
      shall apply to any Claim which arises (or to the extent that it is increased)
      as
      a consequence of fraud or fraudulent misrepresentation by Kerr-McGee or any
      of
      its Affiliates.

     

    6.  The
      Buyer’s Warranties

     

    6.1  Subject
      to the provisions of this clause 6,
      the Buyer hereby warrants to Kerr-McGee in the terms set out in Schedule 2
      as at the date hereof.

     

    
      
         

      

      
        13

        
          

        

      

      
         

      

    

    6.2  The
      Buyer’s Warranties will be repeated at Completion to the extent that they relate
      to the conduct of the Buyer by reference to the facts and circumstances then
      existing.

     

    6.3  If
      the Buyer pays to Kerr-McGee an amount pursuant to a Buyer Warranty Claim and
      Kerr Mc-Gee is entitled to recover from some other person any sum to which
      it
      would not have been or become entitled but for the circumstances giving rise
      to
      such Buyer Warranty Claim, subject to being put in funds to the reasonable
      satisfaction of Kerr-McGee, Kerr-McGee shall promptly undertake all appropriate
      steps to enforce such recovery and shall as soon as practicable following any
      such recovery repay to the Buyer the lesser of: (i) the amount paid to it by
      the
      Buyer pursuant to the Buyer Warranty Claim; and (ii) the amount recovered from
      the third party in each case less all costs, charges and expenses reasonably
      incurred by Kerr McGee in obtaining (or consequent upon obtaining) that payment
      and in recovering that amount from the third party and net of any tax payable
      on
      the amount received or that would have been payable but for the use of set
      off
      of any relief.

     

    6.4  The
      Buyer shall notify Kerr-McGee in writing of any circumstances, facts or matters
      which following execution of this Agreement become known to it prior to
      Completion which are inconsistent with any of the Buyer’s Warranties or which
      would if subsisting at Completion be inconsistent with any of those warranties,
      as repeated at the Completion Date pursuant to clause 6.2.
      Such notice shall state that it is served pursuant to this 6.4.

     

    7.  Conduct
      of Claims

     

    7.1  If
      the Buyer becomes aware of any claim or potential claim by a third party (a
      third
      party claim)
      which might result in a Claim being made, the Buyer shall:

     

    	(a)  	
            promptly,
              and in any event within thirty (30) days of it becoming aware of it,
              give
              notice of such third party claim to Kerr-McGee, stating the nature,
              basis
              and amount thereof, to the extent known, along with copies of the relevant
              documents evidencing such third party claim and procure that Kerr-McGee
              and its representatives are given all reasonable facilities to investigate
              it;

          


     

    	(b)  	
            not
              make (and procure that each member of the Buyer Group shall not make)
              any
              admission of liability, agreement or compromise with any person, body
              or
              authority in relation to that third party claim without the prior written
              approval of Kerr-McGee, such approval not to be unreasonably withheld
              or
              delayed;

          


     

    	(c)  	
            subject
              to the Buyer or the relevant member of the Buyer Group being indemnified
              by Kerr-McGee against all reasonable out of pocket costs and expenses
              properly incurred in respect of that third party
              claim:

          


     

    	(i)  	
            take,
              and procure that each member of the Buyer Group shall take, such action
              as
              Kerr-McGee may reasonably request to avoid, resist, dispute, appeal,
              compromise or defend such third party
              claim;

          


     

    	(ii)  	
            allow,
              or, as appropriate, procure that the relevant member of the Buyer Group
              shall allow, Kerr-McGee to take over the conduct of all proceedings
              and/or
              negotiations of whatsoever nature arising in connection with the third
              party claim in question; and

          


     

    
      
         

      

      
        14

        
          

        

      

      
         

      

    

    	(iii)  	
            provide,
              or procure that the relevant member of the Buyer Group shall provide,
              such
              information and assistance as Kerr-McGee may reasonably require in
              connection with the preparation for and conduct of any proceedings
              and/or
              negotiations relating to that third party
              claim.

          


     

    7.2  Without
      prejudice to clause 7.1,
      the Parties will use their reasonable best efforts to minimise Losses and
      Expenses from third party claims and will act in good faith in responding to,
      defending against, settling or otherwise dealing with such claims.

     

    7.3  Failure
      of the Buyer to give notice in accordance with clause 7.1(a)
      shall not relieve Kerr-McGee of any of its obligations relating to Claims under
      this Agreement, except if and to the extent that Kerr-McGee is actually
      prejudiced thereby (except that Kerr-McGee shall not be liable for any expenses
      incurred during the period prior to the Buyer giving such notice).

     

    7.4  Whether
      or not Kerr-McGee has assumed the conduct of proceedings or negotiations (in
      accordance with clause 7.1(c)(ii)
      above),
      Kerr-McGee shall not be liable under any Claim for any admission of liability,
      agreement or compromise that was consented to without Kerr-McGee’s prior written
      approval which relates to such Claim unless such approval has been unreasonably
      withheld or delayed.

     

    7.5  If
      the Buyer makes a Claim or notifies Kerr-McGee of any third party claim which
      might lead to such a claim being made, the Buyer shall at the Buyer’s cost make
      available to accountants and other representatives appointed by Kerr-McGee
      such
      access to personnel, records and information as Kerr-McGee reasonably requests
      in connection with such Claim or third party claim.

     

    8.  Completion
      Adjustments

     

    8.1  Where
      any sums are taken into account in:

     

    	(a)  	
            the
              Working Capital Adjustment;

          


     

    	(b)  	
            the
              Billed Invoice Adjustment;

          


     

    	(c)  	
            the
              Petroleum Sales Adjustment;

          


     

    	(d)  	
            the
              NPR Adjustment;

          


     

    	(e)  	
            the
              Interest Adjustment;

          


     

    	(f)  	
            the
              Taxation Adjustment;

          


     

    
      
         

      

      
        15

        
          

        

      

      
         

      

    

    (together,
      the Adjustments
      (with
      Adjustment meaning any or all of the above (as the context may require)), or
      are
      payable by the Buyer to Kerr-McGee or by Kerr-McGee to the Buyer pursuant to
      this clause 8,
      clause 10,
      Schedule 5
      or Schedule 8
      (together the Adjustment
      Clauses)
      or pursuant to a Kerr-McGee Warranty Claim under clause 5
      or a Buyer Warranty Claim under clause 6 or a payment under
      clause 12.4,
      the same shall operate by way of increases or decreases, as the case may be,
      in
      the Base Consideration.

     

    8.2  The
      following principles shall apply in respect of the Adjustments and the Base
      Consideration:

     

    	(a)  	
            the
              Base Consideration shall be adjusted by the
              Adjustments;

          


     

    	(b)  	
            no
              item taken into account in calculating any one Adjustment or other
              increases or decreases as the case may be under the Adjustment Clauses
              or
              clause 5
              or 6
              or 12.4
              shall be taken into account in calculating any of the other Adjustments
              so
              as to result in a Party making or receiving payment twice in respect
              thereof nor will any Party be entitled under clause 12
              to reimbursement of any payment received from a third party to the
              extent
              such payment has been taken into account (to the benefit of that Party)
              in
              calculating any of the Adjustments;

          


     

    	(c)  	
            no
              adjustment to the Base Consideration shall be made in respect of any
              matters to which clauses 12.6
              and 12.8
              apply.

          


     

    	8.3  	
            (a)Kerr-McGee
              shall provide the Buyer with a written statement specifying its best
              estimate of the sum of all the Adjustments as at the Completion Date
              (the
              Interim
              Net Adjustment Amount)
              which if positive shall increase the Base Consideration payable by
              the
              Buyer at Completion and if negative shall reduce the Base Consideration
              payable by the Buyer at Completion.

          


     

    	(b)  	
            Such
              statement (the Interim
              Completion Statement)
              shall be provided no later than two (2) Business Days prior to Completion,
              in the format set out in Schedule 5.

          


     

    8.4  Within
      sixty (60) days after Completion, and without prejudice to the provisions of
      clause 12,
      Kerr-McGee shall provide the Buyer with a written statement (in the format
      set
      out in Schedule 5)
      giving its calculation of the final amounts of each of:

     

    	(a)  	
            the
              Adjustments save in relation to the Taxation Adjustment for which a
              reasonable estimate shall be calculated;

          


     

    	(b)  	
            the
              Net Adjustment Amount; and

          


     

    	(c)  	
            the
              balance payable by Kerr-McGee or the Buyer after taking into account
              the
              Interim Net Adjustment Amount which adjusted the Base Consideration
              paid
              at Completion,

          


     

    (the
      Final
      Completion Statement).
      The Buyer shall notify Kerr-McGee in writing (such notification being an
Objection
      Notice)
      within fifteen (15) Business Days after receipt whether or not it accepts that
      the Final Completion Statement has been prepared in accordance with the relevant
      provisions of this Agreement. Any notice indicating that the Buyer does not
      so
      accept the Final Completion Statement shall to the extent practicable and
      reasonable:

     

    
      
         

      

      
        16

        
          

        

      

      
         

      

    

    	(a)  	
            set
              out in detail the Buyer’s reasons for such non-acceptance;
              and

          


     

    	(b)  	
            specify
              the adjustments which, in the Buyer’s opinion, should be made to the Final
              Completion Statement in order to comply with the provisions of this
              Agreement; and

          


     

    	(c)  	
            set
              out the specific items that are in dispute accompanied by the Buyer’s
              calculation at its best estimate of each of the items that are in dispute
              (the Disputed
              Amounts).

          


     

    Except
      for Disputed Amounts, the Buyer shall be deemed to have accepted the Final
      Completion Statement in full.

     

    8.5  If
      the Buyer serves an Objection Notice in accordance with clause 8.4
      above,
      then the Buyer and Kerr-McGee shall use all reasonable endeavours: (a) to meet
      and discuss the objections of the Buyer; and (b) to reach agreement upon the
      adjustments (if any) required to be made to the Final Completion Statement,
      within a period of ten (10) Business Days after receipt by Kerr-McGee of the
      Objection Notice. During such ten (10) Business Days period Kerr-McGee and
      its
      representatives shall be permitted to review the working papers of the Buyer
      and
      its representatives relating to the Objection Notice and the basis
      therefor.

     

    8.6  If
      the Buyer notifies Kerr-McGee in writing that it is satisfied with the Final
      Completion Statement (either as originally submitted or after adjustments agreed
      between Kerr-McGee and the Buyer pursuant to clause 8.5)
      or if the Buyer fails to give an Objection Notice within the fifteen (15)
      Business Days period referred to in clause 8.4,
      then the payment of the Net Adjustment Amount (after taking into account the
      Interim Net Adjustment Amount which adjusted the Base Consideration paid at
      Completion) due in accordance with the Final Completion Statement shall be
      made
      within three (3) Business Days of such written notification or such failure
      to
      give an Objection Notice (as the case may be), together with simple interest
      on
      such amount from and including the Completion Date up to and excluding the
      date
      of payment calculated on a daily basis on the basis of a 360 day year at the
      rate of 2% per annum above the Reference Interest Rate.

     

    8.7  If
      the Parties cannot reach agreement as specified in clause 8.6
      within the time limit provided in that clause, the Disputed Amounts may be
      referred by any Party for determination by an independent chartered accountant
      nominated by the Parties or, in the absence of agreement between the Parties
      within five (5) Business Days of a Party notifying the other that it proposes
      to
      refer the dispute to an expert, by the President of the Institute of Chartered
      Accountants in England and Wales (the Nominated
      Independent Accountant).
      The Parties shall instruct the Nominated Independent Accountant to render its
      decision within sixty (60) days of its selection. The Nominated Independent
      Accountant shall be afforded such access to books, records, accounts and
      documents in the possession of the Parties as he may reasonably request, and
      he
      shall act as expert not as arbitrator. The said accountant’s determination
      shall, in the absence of fraud or manifest error, be final and binding on the
      Parties, his fees and disbursements shall be borne by Kerr-McGee as to one
      half
      and the Buyer as to the other half and each party shall bear its own costs
      in
      respect of such references. Payment of the Net Adjustment Amount (after taking
      into account the Interim Net Adjustment Amount which adjusted the Base
      Consideration paid at Completion) in accordance with the Nominated Independent
      Accountant’s determination of the Disputed Amounts and in accordance with the
      Final Completion Statement in respect of all other items shall be made within
      three (3) Business Days of the determination of the Nominated Independent
      Accountant, together with simple interest on such amount from and including
      the
      Completion Date up to and excluding the date of payment calculated on a daily
      basis on the basis of a 360 day year at the rate of 2% per annum above the
      Reference Interest Rate.

     

    
      
         

      

      
        17

        
          

        

      

      
         

      

    

    8.8  Kerr-McGee
      shall provide the Buyer with copies of all Operator’s reports, billing
      statements and correspondence and any and all other relevant documentation
      in
      its possession or under its control reasonably necessary to support the
      statements referred to in clauses 8.3
      and 8.4
      simultaneously with the provision of such statements. The Parties shall liaise
      on the compilation and agreement of the said statements.

     

    8.9  To
      enable Kerr-McGee to meet its obligations under this clause 8,
      the Buyer shall provide to Kerr-McGee and to Kerr-McGee’s accountants full
      access to the books and records, employees and premises of the Buyer. The Buyer
      shall fully co-operate with Kerr-McGee and shall permit Kerr-McGee and
      Kerr-McGee’s accountants to take copies (including electronic copies) of the
      relevant books and records and shall provide all assistance reasonably requested
      by Kerr-McGee to facilitate the preparation of the Final Completion Statement.
      The Buyer hereby agrees not to take any action which would impede or delay
      the
      preparation of the Final Completion Statement or the determination of the Total
      Consideration in the manner and using the methods required by this Agreement.
      The provisions of this clause 8.9
      shall apply mutatis mutandis to Kerr-McGee in relation to the obligations of
      the
      Buyer under this clause 8.

     

    8.10  All
      of the calculations to be made pursuant to this clause 8
      shall be made on an Accrual Basis of Accounting and in accordance with
      accounting principles generally accepted in the oil and gas industry in the
      United Kingdom at the date of Completion unless otherwise stated in this
      Agreement and such principles shall be consistently applied for the purposes
      of
      any and all disputes between the Parties.

     

    8.11  Notwithstanding
      any contrary provision in this Agreement the Parties agree to cooperate in
      order
      to re-calculate the estimated Taxation Adjustment (referred to in
      clause 8.4)
      prior to 30 June 2006 in accordance with the provisions of Schedule 8;
      provided that this re-calculation shall not have any impact on the Final
      Completion Statement or the Total Consideration and the provisions of
      clause 8.7
      shall apply mutatis mutandis in the event of failure to agree such Taxation
      Adjustment by 30 June 2006.

     

    8.12  In
      the event of late payment, clause 13
      will apply.

     

    
      
         

      

      
        18

        
          

        

      

      
         

      

    

    9.  Information,
      Records and Assistance Post Completion

     

    9.1  Each
      of Kerr-McGee and the Buyer shall provide (and upon reasonable request procure
      that its respective Affiliates provide) the other with reasonable access to
      (and
      the right, at the cost of the Party making the request, to take copies of)
      the
      books, accounts and all other records held by any member of the Buyer Group
      or
      the Kerr-McGee Group respectively after Completion to the extent that such
      books, accounts and records relate to the Assets and to the period up to
      Completion (the Records).
      This obligation is subject to:

     

    	(a)  	
            the
              provisions of clause 15;

          


     

    	(b)  	
            the
              person seeking access providing reasonable justification that the same
              is
              required;

          


     

    	(c)  	
            access
              being given only during working hours;

          


     

    	(d)  	
            any
              restrictions on access imposed by law or the terms of any agreement;
              and

          


     

    	(e)  	
            any
              claim for legal privilege.

          


     

    9.2  For
      a period of seven years following the Completion Date, neither Kerr-McGee nor
      the Buyer shall dispose of or destroy (and each shall procure that its
      respective Affiliates do not dispose of or destroy) any of the Records without
      first giving the other at least two months’ notice of its intention to do so and
      giving the other a reasonable opportunity to remove and retain any of them
      (at
      that other person’s expense).

     

    9.3  Without
      prejudice to any information, access or assistance required under
      clauses 7.5,
      8.8
      or 8.9,
      the Buyer shall (and shall procure that each member of the Buyer Group shall),
      at Kerr-McGee’s expense and on reasonable notice from Kerr-McGee, give such
      assistance to any member of the Kerr-McGee Group as Kerr-McGee may reasonably
      request in relation to any third party proceedings by or against any member
      of
      the Kerr-McGee Group so far as the same relate to the Assets, including
      proceedings relating to taxation. 

     

    9.4  This
      clause 9
      shall not apply to the process for ascertaining the Final Completion Statement
      or in relation to any investigation of any actual or potential claim or dispute
      in connection with this Agreement.

     

    10.  Taxation

     

    Schedule 8
      shall apply in relation to taxation.

     

    11.  Transition
      Period

     

    11.1  During
      the Transition Period, Kerr-McGee shall to the extent it is able so to do having
      regard to the provisions of the relevant Operating Agreements and Unit
      Agreements:

     

    
      
         

      

      
        19

        
          

        

      

      
         

      

    

    	(a)  	
            continue
              to carry on its activities in relation to the Assets in all material
              respects in the ordinary and usual course of business and comply with
              previously agreed decisions of the operating committees in relation
              to the
              Assets and any agreement relating to the Assets to which it is a
              party;

          


     

    	(b)  	
            consult
              with the Buyer with regard to any material decisions relating to the
              Assets and co-operate with the Buyer so as to ensure an efficient handover
              of the Assets on Completion; and

          


     

    	(c)  	
            insofar
              as reasonably practicable, keep the Buyer informed in a timely manner
              on
              any and all matters (not of a routine or minor nature) relating to
              the
              Assets.

          


     

    11.2  During
      the Transition Period, subject to its obligations under clause 11.1
      and its obligations to comply with the terms of the Asset Documents Kerr-McGee
      shall:

     

    	(a)  	
            not,
              except with the prior written approval of the Buyer (such approval
              not to
              be unreasonably withheld or delayed) enter into any agreement relating
              to
              the sale transportation or processing of gas, condensate or any other
              liquids arising from the Assets or amend, terminate or agree to amend
              or
              terminate any of the Asset Documents in any material respect in so
              far as
              such amendment, termination or agreement to amend or terminate relates
              to
              or materially affects the Assets or waive or agree to waive any of
              its
              rights or remedies thereunder or arising therefrom in so far as such
              rights and remedies relate to or materially affect the Assets and relates
              or is capable of relating to periods after the Effective
              Date;

          


     

    	(b)  	
            not
              charge or otherwise encumber any of the
              Assets;

          


     

    	(c)  	
            if
              it considers reasonably and in good faith that a particular matter
              or
              proposal is of a nature which may have a material adverse effect on
              the
              value of the Assets, notify the Buyer in writing, consult (to the extent
              reasonably practicable) with the Buyer in relation to that matter or
              proposal, take account of any reasonable representation which the Buyer
              may make and, provided always that such action shall not be prejudicial
              to
              any of Kerr-McGee’s other business interests and Kerr-McGee shall not be
              in breach of any contractual, legal, statutory or regulatory requirement
              whatsoever by doing so, carry out the wishes of the Buyer in so far
              as it
              is reasonable to do so following such consultation;
              and

          


     

    	(d)  	
            to
              the extent practicable in the circumstances consult with the Buyer
              in
              relation to any matter requiring its vote under any Operating Agreement
              and take account of the Buyer’s reasonable representations but so that
              nothing in this sub-clause shall operate to fetter the discretion of
              Kerr-McGee in exercising its votes in respect
              thereto.

          


     

    11.3  Subject
      to the provisions of this Agreement, the Buyer shall accept the Assets in the
      physical condition in which they exist at the date of this Agreement and,
      notwithstanding that title will not pass until Completion, shall assume the
      risk
      of damage thereto or the destruction thereof as from the date of this Agreement.
      Notwithstanding clause 12
      or any other provisions to the contrary, the Buyer shall with effect from the
      date of this Agreement be obliged to effect and maintain appropriate insurance
      in respect of the Assets and the Buyer shall accordingly have no benefit of
      any
      insurance maintained by Kerr-McGee in respect of the Assets.

     

    
      
         

      

      
        20

        
          

        

      

      
         

      

    

    12.  Indemnity

     

    12.1  The
      provisions of this clause 12
      shall only take effect once Completion has occurred. All adjustments and
      reimbursements made and the ascertainment of all Obligations and Benefits under
      this clause 12
      will be calculated using the Accruals Basis of Accounting.

     

    12.2  Kerr-McGee
      shall be liable for all Obligations, and shall be entitled to all Benefits,
      in
      each case which accrue in or relate to any period before the Effective
      Date.

     

    12.3  The
      Buyer shall be liable for all Obligations, and shall be entitled to all
      Benefits, in each case which accrue in or relate to any period on or after
      the
      Effective Date.

     

    12.4  Subject
      to clauses 12.9,
      12.12
      and 12.13,
      save to the extent the same falls to be taken into account in the Net Adjustment
      Amount and subject to clauses 5,
      6,
      10
      and 14:

     

    	(a)  	
            if
              any Obligations are incurred by Kerr-McGee or any of its Connected
              Persons
              in respect of any period on or after the Effective Date, the Buyer
              shall
              reimburse and indemnify Kerr-McGee and its Connected Persons in respect
              thereof;

          


     

    	(b)  	
            if
              any Obligations are incurred by the Buyer or any of its Connected Persons
              in respect of any period prior to the Effective Date, Kerr-McGee shall
              (subject to paragraph 3.7
              of Schedule 8)
              reimburse and indemnify the Buyer and its Connected Persons in respect
              thereof;

          


     

    	(c)  	
            if
              any Benefits accrue to Kerr-McGee or any of its Connected Persons in
              respect of any period on or after the Effective Date, Kerr-McGee shall
              (subject to paragraph 3.6
              of Schedule 8)
              account to and reimburse the Buyer and its Connected Persons in respect
              thereof; and

          


     

    	(d)  	
            if
              any Benefits accrue to the Buyer or any of its Connected Persons in
              respect of any period prior to the Effective Date, the Buyer shall
              account
              to and reimburse Kerr-McGee and its Connected Persons in respect
              thereof.

          


     

    12.5  Any
      amount to be paid or reimbursed in accordance with clause 12.4
      or any other provision of this clause 12
      shall: (i) in the case of those amounts that arise prior to the Completion
      Date,
      be paid or reimbursed on Completion; and (ii) in the case of those amounts
      that
      arise on or after the Completion Date be paid or reimbursed within ten (10)
      Business Days of receipt thereof (or, in the case of Obligations, within ten
      (10) Business Days of receipt of notification from the Party which has incurred
      such Obligations) in each case, to Kerr-McGee’s Account or the Buyer’s Account
      (as the case may be). Without prejudice to the generality of the foregoing,
      each
      Party undertakes to provide written advice to the other Party of any event
      giving rise to an adjustment under this clause 12
      within fifteen (15) Business Days of becoming aware of such an event. Such
      advice will include a copy of such documentary evidence as is reasonably
      necessary to enable the other Party to verify the adjustment.

     

    
      
         

      

      
        21

        
          

        

      

      
         

      

    

    12.6  For
      the avoidance of doubt and notwithstanding the foregoing provisions of this
      clause 12,
      the Buyer shall at its cost and expense perform and shall be responsible for
      decommissioning, abandonment, removing and making safe all plant, equipment
      and
      machinery, wells and other installations (including offshore installations,
      pipelines and submarine pipelines) and facilities relating to operations under
      any of the Licences or under each and any Operating Agreement or other Asset
      Document to the extent that such obligations are attributable to the Assets
      whether under or pursuant to any of the Asset Documents or under statutory
      obligation, common law, international law, international convention or any
      other
      obligation. The Buyer covenants that it shall indemnify and hold Kerr-McGee
      and
      its Connected Persons harmless against any and all Losses and Expenses which
      Kerr-McGee or any of its Connected Persons may incur arising out of or in
      connection with the Decommissioning Liabilities regardless of whensoever such
      Decommissioning Liabilities may arise or may have arisen, regardless of
      whosoever is or was a licensee under the relevant Licence or a party to the
      relevant Operating Agreement or owned or leased the relevant property and
      regardless of whether such Losses and Expenses arise as a consequence of
      negligence on the part of Kerr-McGee or any of its Connected Persons or any
      other person provided that for the avoidance of doubt the Buyer shall not be
      required to reimburse Kerr-McGee for amounts actually expended by Kerr-McGee
      prior to the Effective Date in respect of Decommissioning
      Liabilities.

     

    12.7  The
      Buyer is hereby notified that detectable amounts of hazardous substances
      (including chemicals known to cause cancer, birth defects, and reproductive
      harm
      or any other harm) may be found in, on, or around the Assets. In addition,
      the
      Buyer acknowledges that some oil field production equipment may contain
      naturally occurring radioactive material (NORM),
      asbestos and/or other hazardous substances. In this regard, the Buyer expressly
      understands that NORM and other hazardous substances may affix or attach itself
      to the inside of wells, materials and equipment as scale or in other forms,
      and
      that wells, materials and equipment located on the Assets may contain NORM
      and
      other hazardous substances and that materials containing NORM and other
      hazardous substances may be buried or have been otherwise disposed of on or
      under the Assets. The Buyer also expressly understands that special procedures
      may be required for the removal and disposal of NORM, asbestos and other
      hazardous substances from the Assets where it may be found, and that the Buyer
      assumes all liability and responsibility for such activities when and if
      performed after the Effective Date.

     

    12.8  Notwithstanding
      the other provisions of this clause 12,
      the Buyer covenants that it shall indemnify and hold Kerr-McGee and its
      Connected Persons harmless against any Losses and Expenses which Kerr-McGee
      or
      any of its Connected Persons may incur arising out of or in connection with
      the
      Environmental Liabilities regardless of whensoever such Environmental
      Liabilities may arise or may have arisen, regardless of whosoever is or was
      a
      licensee under the relevant Licence or a party to the relevant Operating
      Agreement or owned or leased the relevant property.

     

    
      
         

      

      
        22

        
          

        

      

      
         

      

    

    12.9  Upon
      Kerr-McGee’s request from time to time, the Buyer will support any application
      by Kerr-McGee to obtain from the relevant authorities an irrevocable release
      of
      Kerr-McGee from its obligations and liabilities under the Petroleum Act 1998
      or
      other relevant statute, regulations, order from any competent authority or
      guidelines and all notices and regulations served and issued pursuant thereto,
      insofar as the same relate to the Assets. Without prejudice to the foregoing,
      if, following the Completion Date, the Secretary of State requests that
      Kerr-McGee prepares and implements a programme or requirement for or in respect
      of any part of the Decommissioning Liabilities, whether pursuant to the terms
      of
      the Petroleum Act 1998 or other relevant statute, regulations, order from any
      competent authority or guidelines, Kerr-McGee shall do so in accordance with
      the
      requirements of the Petroleum Act 1998 or other relevant statute, regulation,
      order or guidelines, as the case may be, and all other relevant statutes,
      regulations, orders and guidelines and the indemnities in
      clause 12.6
      and 12.8
      shall extend to all Losses and Expenses incurred by or on behalf of Kerr-McGee
      in the preparation and implementation of such programme.

     

    12.10  Without
      prejudice to the provisions of clauses 12.2,
      12.3
      and 12.4,
      any Benefits or Obligations (including the cost of any audit) accruing in
      respect of the Assets in the form of amounts receivable or payable resulting
      from an audit pursuant to a Operating Agreement or from any other subsequent
      adjustment in relation to the operation of, and expenditure attributable to,
      the
      Assets in the period prior to the Effective Date shall accrue to Kerr-McGee
      and
      any such Benefits or Obligations attributable to the Assets in the period from
      and after the Effective Date shall accrue to the Buyer. Where any such audit
      takes place after the Completion Date, the Buyer shall promptly notify Kerr
      Mc
      Gee thereof and shall be obliged to take account of Kerr-McGee’s reasonable
      representations in connection with such audit and to notify Kerr-McGee of any
      audit adjustment as soon as practicable after the results of such audit are
      known. If, as a result of any audit adjustment or otherwise, either Kerr-McGee
      or the Buyer is, on the principles set out in clauses 12.2,
      12.3
      and 12.4,
      so liable to pay any amount to the other, then, to the extent that the same
      has
      not been taken into account or falls to be taken into account in the Net
      Adjustment Amount, or the amount has not otherwise been paid in accordance
      with
      clause 12.4,
      such amount shall be paid to Kerr-McGee’s Account or the Buyer’s Account (as
      appropriate) within thirty (30) Business Days after the amount receivable or
      payable as a result of such an audit or other subsequent adjustment has been
      taken into account by the relevant Operator in the Operator’s billing
      statement.

     

    12.11  The
      Buyer and Kerr-McGee shall use all reasonable endeavours to procure the
      unconditional and irrevocable release of Kerr-McGee and its Affiliates from
      all
      guarantees and indemnities to which Kerr-McGee or any of its Affiliates is
      a
      party (the Kerr-McGee Guarantees) given in the ordinary course of business
      related to the operations of the Assets. The Buyer covenants that it shall
      indemnify and hold Kerr-McGee and its Affiliates harmless against all Losses
      and
      Expenses which Kerr-McGee or any of its Affiliates may incur arising out of
      or
      in connection with any of the Kerr-McGee Guarantees which have not been
      discharged on or before Completion, in respect of Losses or Expenses incurred
      in
      respect of the period after the Effective Date.

     

    
      
         

      

      
        23

        
          

        

      

      
         

      

    

    12.12  Paragraphs 7,
      8,
      9,
      10,
      11,
      12,
      13,
      and 15
      of Schedule 3
      (Limitations on Liabilities) shall apply to any Claim made under this
      Clause 12.

     

    12.13  Notwithstanding
      anything herein provided to the contrary, Kerr-McGee and the Buyer do hereby
      covenant and agree that the recovery by either Party hereto of any damages
      suffered or incurred by it as a result of any breach by the other party of
      any
      of its covenants, agreements, representations, guaranties, warranties,
      indemnities, disclaimers, waivers or continuing obligations under this Agreement
      shall be limited to the actual damages suffered or incurred by the non-breaching
      party as a result of such breach, and in no event shall such recovery include
      any indirect, consequential, exemplary or punitive damages.

     

    12.14  If
      final judgement which is not capable of being appealed by Kerr-McGee is obtained
      against Kerr-McGee as a result of the breach of a Kerr-McGee Warranty and such
      judgement provides for the payment of damages to the Buyer by Kerr-McGee,
      Kerr-McGee may not claim to be indemnified by the Buyer against the cost of
      paying such damages to the Buyer provided that

     

    	(a)  	
            notwithstanding
              this clause 12.14
              Kerr-McGee shall at all times and in all circumstances be able to claim
              indemnity from the Buyer pursuant to Clause 12.6;
              and

          


     

    	(b)  	
            except
              as expressly provided in this Clause 12.14
              nothing in this Agreement shall operate to limit the right of Kerr-McGee
              to be indemnified by the Buyer; and

          


     

    	(c)  	
            if
              Kerr-McGee agrees to pay a sum claimed by the Buyer in respect of a
              Kerr-McGee Warranty Claim then Kerr-McGee agrees not to claim an indemnity
              from the Buyer under this Agreement in relation
              thereto.

          


     

    13.  Interest
      on Late Payment

     

    Where,
      in this Agreement, any date is specified as being the due date for payment
      and
      payment is not made on that date, simple interest calculated on the basis of
      a
      360 day year shall be paid on the amount outstanding on a daily basis (after
      as
      well as before any judgement) from the start of the due date to the end of
      the
      day preceding the date of actual payment at the rate of three per cent (3%)
      per
      annum above the Reference Interest Rate.

     

    14.  Costs

     

    Except
      as otherwise provided herein, the Parties shall pay their own costs and expenses
      in connection with this Agreement and the documents executed pursuant
      hereto.

     

    15.  Confidentiality

     

    15.1  This
      Agreement and its terms shall be held confidential by the Parties and shall
      not
      be divulged in any way to any third party by one Party without the prior written
      approval of the other Party; provided that any Party may, without such approval,
      disclose such terms to:

     

    
      
         

      

      
        24

        
          

        

      

      
         

      

    

    	(a)  	
            any
              Affiliate of it provided the disclosing Party procures that such Affiliate
              maintains such terms confidential; or

          


     

    	(b)  	
            any
              outside professional consultants or other professional advisers consulted
              in connection with the terms of this Agreement, provided the disclosing
              Party obtains a similar undertaking of confidentiality (but excluding
              this
              proviso) from such consultants or professional advisers;
              or

          


     

    	(c)  	
            any
              bank or financial institution from whom such Party is seeking or obtaining
              finance, provided the disclosing Party obtains a similar undertaking
              of
              confidentiality (but excluding this proviso) from such bank or
              institution; or

          


     

    	(d)  	
            the
              extent required by any applicable laws, the Licences, or the requirements
              of any recognised stock exchange in compliance with its rules and
              regulations; or

          


     

    	(e)  	
            any
              independent public accountants; or

          


     

    	(f)  	
            any
              Government agency lawfully compelling the disclosure of such terms;
              or

          


     

    	(g)  	
            any
              Court of competent jurisdiction acting in pursuance of its powers;
              or

          


     

    	(h)  	
            to
              any person seeking to purchase the Assets from the Buyer;
              or

          


     

    	(i)  	
            the
              extent that the terms of this Agreement become public knowledge or
              for any
              other reason ceases to be confidential otherwise than through breach
              of
              this undertaking.

          


     

    15.2  The
      Buyer acknowledges that any information provided to it in connection with this
      Agreement is subject to the terms of the confidentiality agreement dated
      15th
      June 2005 signed between the Buyer and Kerr-McGee (the Confidentiality
      Agreement).

     

    16.  Announcements

     

    No
      Party shall make a public announcement or statement regarding the execution,
      existence or terms of this Agreement without the prior agreement of the other
      Party, such agreement not to be unreasonably withheld or delayed; provided,
      however, that any such Party may make such public disclosure it believes in
      good
      faith is required by applicable law including the rules and regulations of
      any
      applicable stock exchange or governmental or regulatory authority (in which
      case
      the disclosing Party shall use its reasonable endeavours to advise the other
      Parties prior to making such disclosure).

     

    17.  Miscellaneous

     

    17.1  The
      sole remedy of the Buyer for any breach of any of the Warranties or any other
      breach of this Agreement by Kerr-McGee or any member of Kerr-McGee Group shall
      be an action for damages. The Buyer shall not be entitled to rescind or
      terminate this Agreement in any circumstances whatsoever (whether before or
      after Completion), other than pursuant to any such rights which arise in respect
      of fraud or fraudulent misrepresentation or which arise under
      clause 2.5
      or clause 5.9.

     

    
      
         

      

      
        25

        
          

        

      

      
         

      

    

    17.2  Except
      insofar as any term or provision of this Agreement is satisfied on Completion,
      this Agreement shall remain in full force and effect after
      Completion.

     

    17.3  No
      waiver by any Party of any breach of a provision of this Agreement shall be
      binding unless made expressly in writing. Any such waiver shall relate only
      to
      the breach to which it expressly relates and shall not apply to any subsequent
      or other breach.

     

    17.4  All
      payments to be made under this Agreement shall be made in United States Dollars
      unless otherwise agreed between the Parties and shall be paid in cash in
      immediately cleared funds directly to Kerr-McGee’s Account or the Buyer’s
      Account (as appropriate) by bank transfer unless otherwise agreed between the
      Parties. All payments made or received in currencies other than United States
      Dollars shall be converted into United States Dollars at the Exchange
      Rate.

     

    17.5  To
      the extent that there is an inconsistency between this Agreement and any of
      the
      Completion Documents, this Agreement shall prevail as between the
      Parties.

     

    17.6  Unless
      expressly stated herein, no term in this Agreement is intended to be enforceable
      by third parties under the Contracts (Rights of Third Parties) Act 1999 and,
      where an obligation is expressly stated to be enforceable by a third party,
      the
      consent of that third party will not be required to rescind or vary the relevant
      term. Connected Persons shall have the right to enforce the terms of
      clause 18
      under such Act.

     

    17.7  No
      Party shall have the right to assign, transfer or otherwise dispose of its
      rights and obligations under this Agreement without the consent of the other
      Party, which consent shall not be unreasonably withheld or delayed; save that
      each of Kerr-McGee and the Buyer shall have the right to assign, transfer or
      otherwise dispose of its rights under this Agreement to any of their Affiliates
      without the consent of the other.

     

    17.8  This
      Agreement shall inure to the benefit of and be binding upon the respective
      successors and permitted assigns of the Parties.

     

    17.9  Nothing
      in this Agreement shall be read or construed as excluding any liability or
      remedy in respect of fraud.

     

    18.  Entire
      Agreement

     

    18.1  The
      Transaction Documents set out the entire agreement and understanding between
      the
      Parties. The Transaction Documents supersedes all prior agreements,
      understandings or arrangements (whether oral or written) relating to the sale
      and purchase of the Assets which shall cease to have any further force or
      effect. It is agreed that:

     

    
      
         

      

      
        26

        
          

        

      

      
         

      

    

    	(a)  	
            neither
              Party has entered into the Transaction Documents in reliance upon,
              nor
              shall any party have any claim or remedy in respect of, any statement,
              representation, warranty, undertaking, assurance, collateral contract
              or
              other provision made by or on behalf of the other Party (or any of
              its
              Connected Persons) which is not expressly set out in this
              Agreement;

          


     

    	(b)  	
            all
              terms and conditions which are implied under the Sale of Goods Act
              in a
              contract of sale of goods to which that Act applies are expressly excluded
              from the sale and purchase under this agreement, except that this clause
              shall not exclude any liability under section 12 of the Sale of Goods
              Act;

          


     

    	(c)  	
            the
              only right or remedy of a Party in relation to any statement,
              representation, warranty, undertaking, assurance, collateral contract
              or
              other provision set out in this Agreement shall be for breach of this
              Agreement; and

          


     

    	(d)  	
            except
              for any liability which a Party (or any of its Connected Persons) has
              under or in respect of any breach of this Agreement, no Party (or any
              of
              its Connected Persons) shall owe any duty of care or have any liability
              in
              tort or otherwise to any other party (or its respective Connected Persons)
              in respect of, arising out of, or in any way relating to the proposed
              transaction,

          


     

    provided
      that this clause shall not exclude any liability for (or remedy in respect
      of)
      fraud or fraudulent misrepresentation.

     

    18.2  The
      agreements and undertakings in this clause 18
      are given by each Party on its own behalf and as agent for each of its Connected
      Persons. Each Party acknowledges that the other Party gives such agreements
      and
      undertakings as agent with the full knowledge and authority of each of its
      respective Connected Persons.

     

    19.  Further
      Assurance

     

    19.1  Kerr-McGee
      shall, from time to time on being required to do so by the Buyer, promptly
      and
      at the cost and expense of Kerr-McGee do or procure the doing of all such acts
      and execute or procure the execution of all such documents in a form
      satisfactory to the Buyer as the Buyer may reasonably consider necessary for
      giving full effect to this Agreement (or to such parts of it as remain operative
      after termination) and securing to the Buyer the full benefit of the rights,
      powers and remedies conferred by Kerr-McGee in this Agreement.

     

    19.2  The
      Buyer shall, from time to time on being required to do so by Kerr-McGee,
      promptly and at the cost and expense of the Buyer do or procure the doing of
      all
      such acts and execute or procure the execution of all such documents in a form
      satisfactory to Kerr-McGee as Kerr-McGee may reasonably consider necessary
      for
      giving full effect to this Agreement (or to such parts of it as remain operative
      after termination) and securing to Kerr-McGee the full benefit of the rights,
      powers and remedies conferred by the Buyer in this Agreement.

     

    
      
         

      

      
        27

        
          

        

      

      
         

      

    

    20.  Notices

     

    20.1  Any
      notice pursuant to this Agreement may be given by facsimile transmission
      (promptly followed by a hard copy delivered in accordance with this
      clause 20.1)
      or letter delivered to the Party to be served at the address stated in
      clause 20.3
      or such other address as may be given for the purposes of this Agreement by
      written notice to the other Party.

     

    20.2  A
      notice given by facsimile transmission shall be deemed to be served on the
      first
      Business Day following the date of dispatch but a notice sent by post or
      delivered personally shall not be deemed to be delivered until received. A
      notice sent by email shall be for information only and shall not be deemed
      to be
      served until served by facsimile transmission or letter in accordance with
      clause 20.1.

     

    20.3  The
      respective addresses for service are:

     

    
      	
              Kerr-McGee:

            	
              Ninian
                House

            
	 	
              Crawpeel
                Road

            
	 	
              Altens

            
	 	
              Aberdeen

            
	 	
              AB12
                3LG

            
	 	
              Fax:
                01224 242116

            
	 	
              Email:

            
	 	
              For
                the attention of the Legal Director

            
	 	 
	 	
              With
                a copy to:

            
	 	
              P.O.
                Box 25861, MT 29

            
	 	
              123
                Robert S. Kerr Ave.

            
	 	
              Oklahoma
                City, OK, USA 73125\

            
	 	
              Fax:
                (405) 270 3649

            
	 	
              Email:

            
	 	
              For
                the attention of Kerr-McGee Corporation’s General

            
	 	
              Counsel

            
	 	 
	
              The
                Buyer:

            	 
	 	 
	
              Centrica
                Resources Limited:

            	
              Millstream

            
	 	
              Maidenhead
                Road

            
	 	
              Windsor

            
	 	
              Berkshire
                SL4 5GD

            
	 	
              Fax: +44
                1753 494602

            
	 	
              For
                the attention of General Counsel and Company

            
	 	
              Secretary

            


    

     

    21.  Governing
      Law and Jurisdiction

     

    21.1  This
      Agreement and the legal relationships established by or otherwise arising in
      connection with this Agreement shall be governed by, and interpreted in
      accordance with, English law.

     

    
      
         

      

      
        28

        
          

        

      

      
         

      

    

    21.2  Each
      of the Parties agrees that the courts of England are to have exclusive
      jurisdiction to settle any disputes (including claims for set off and
      counterclaims) which may arise in connection with the creation, validity,
      effect, interpretation or performance of, or the legal relationships established
      by, this Agreement or otherwise arising in connection with this Agreement,
      and
      for such purposes irrevocably submit to the jurisdiction of the English
      courts.

     

    21.3  Each
      Party irrevocably waives any objections to the jurisdiction of any court
      referred to in this clause.

     

    21.4  Each
      Party irrevocably agrees that a judgment or order of any court referred to
      in
      this clause in connection with this Agreement is conclusive and binding on
      it
      and may be enforced against it in the courts of any other
      jurisdiction.

     

    In
      witness whereof this
      Agreement has been duly executed on the day and year first above
      written.

     

    SIGNED
      for
      and on behalf of 

     

    Kerr-McGee
      North Sea (U.K.) Limited

     

    TERENCE
      JUPP

    __________________________________

     

    


     

    SIGNED
      for
      and on behalf of 

    


    Centrica
      Resources Limited 

    


    ANTHONY
      C. HENSHAW

    _______________________________________

     

     

     

     

     

     

     

     

    
      29