Exhibit 10.1 DunveganPSA


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Exhibit No. 10.1
PURCHASE AND SALE AGREEMENT
Dunvegan & Belloy (Eaglesham & Fairview) Areas, Alberta




THIS AGREEMENT is made August 10, 2015


BETWEEN:


BARNWELL OF CANADA, LIMITED, 
a corporation with an office in Calgary, Alberta, (hereinafter "Vendor” as such term is described in this Agreement)
    
- and -


CANADIAN NATURAL RESOURCES LIMITED, 
a corporation with an office in Calgary, Alberta (hereinafter referred to as the "Purchaser")




WHEREAS Vendor has agreed to sell and convey all legal and beneficial right, title and interest in and to certain assets in the Dunvegan and Belloy Areas of Alberta, whether owned, held by Barnwell of Canada, Limited in its personal capacity, or which it has right, power and authority to convey and transfer to Purchaser as agent and attorney on behalf of others holding beneficial title in certain of such assets;


AND WHEREAS Purchaser has agreed to purchase and accept all such legal and beneficial right, title, estate and interest in and to the such assets owned or held by Vendor aforesaid on the terms and conditions hereinafter set forth;


NOW THEREFORE THIS AGREEMENT WITNESSES that in consideration of the premises, mutual covenants, agreements and warranties hereinafter set forth and contained, the Parties covenant and agree as follows:


ARTICLE 1     
INTERPRETATION
		
	1.1
	Definitions


In this Agreement, including the recitals, this Clause 1.1, and the Schedules, the following capitalized words and phrases shall have the following meanings:


		
	(a)
	"Abandonment and Reclamation Obligations" means all obligations to:


		
	(i)
	abandon the Wells and restore and reclaim the surface sites thereof, to decommission and remove the facilities and equipment comprised in the Tangibles, and restore and reclaim the surface sites thereof; and





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	(ii)
	reclaim and restore the lands to which the surface rights relate (including the removal of all tailings ponds and the remediation of all associated and affected sites);


all in accordance with good oil-and-gas-field practices, and in compliance with the Regulations; 
		
	(b)
	"AC2 Form" means the Petroleum Registry of Alberta Query Capital and Operating Costs – AC2(V4) form to be completed for Closing regarding gas cost allowances calculations;


		
	(c)
	"AER" means the Alberta Energy Regulator;


		
	(d)
	"AFE" means authority for expenditure, unit budget, mail ballot, cash call, or any other approval given by the holder of a working interest in the Lands or Tangibles to conduct an operation, create or incur a financial obligation or accept a risk;


		
	(e)
	"Affiliate" means any company, person, partnership or other legal entity which controls or is controlled by a Party or which controls or is controlled by a company, person, partnership, or other legal entity which controls such Party;  “control” meaning the power to direct or cause the direction of the management and policies of the Party or the other company, person, partnership, or legal entity, as the case may be, whether directly or indirectly, through one or more intermediaries or otherwise, and whether by virtue of being the Party's trustee, owning  shares or other equity interests, or holding voting rights,   contractual rights, trust instruments,  partnership interests or any other such interests.  For certainty, a partnership which is a Party and which is comprised of corporations which are Affiliates shall be deemed to be an Affiliate of each such corporation and its other Affiliates;


		
	(f)
	"Agreement" means this document, together with the Schedules attached hereto and made a part hereof;


		
	(g)
	"Arbitration" means arbitration to be undertaken in accordance with Article 9;


		
	(h)
	"Assets" means all right, title, and estate in and to the Petroleum and Natural Gas Rights, the Tangibles and the Miscellaneous Interests, either owned or held by Barnwell of Canada, Limited for itself in its personal capacity or which Barnwell of Canada, Limited holds as trustee and is empowered and authorized to sell as attorney and agent of the beneficial owners, whether such rights, title, estates and interests are beneficial or legal or both,  contingent or fixed, vested or unvested, and such term means and includes all of the interests described herein as being transferred and conveyed by Vendor, and set forth as “Vendor Interests” in Schedules “A”, “C”, “D”, “E” and “F”, but does not mean or include the Excluded Assets described in Schedule “G”;


		
	(i)
	"Business Day" means any day upon which both Parties are open for normal business in Calgary, Alberta;


		
	(j)
	"Closing" means the transfer and conveyance of the Assets from Vendor to Purchaser and the completion of other matters incidental thereto;





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	(k)
	"Closing Date" means the later of:


		
	(i)
	September 16, 2015; and


		
	(ii)
	three (3) Business Days after the exercise, waiver or expiry by the effluxion of time of any and all Rights of First Refusal; or


such other time and date as may be agreed to by the Parties;


		
	(l)
	"Closing Time" means 2:00 p.m. in Calgary, Alberta, on the Closing Date:


		
	(m)
	"Conveyance Documents" means all conveyances, assignments, registerable transfers, novations, bills of sale, licence transfers, AC2 forms, RMF2 forms, and other documents or instruments, other than the General Conveyance, which are reasonably required or desirable to convey, assign and transfer to Purchaser Vendor's rights, interests and obligations in and to the Assets, and to novate Purchaser in Vendor's place and stead with respect to all agreements affecting or relating to the Assets and all of Vendor’s obligations relating thereto;


		
	(n)
	"Dollar" and "$" mean a dollar of lawful money of Canada;


		
	(o)
	"Effective Date" means 8:00 a.m. Mountain Daylight Time on April 1, 2015;


		
	(p)
	"Environment" means the components of the earth and the atmosphere and includes all layers of the atmosphere, ambient air, the soil, the surface and subsurface strata of land, groundwater and surface water (including lakes, rivers, streams, oceans and aquifers), all organic and inorganic matter and living organisms, and the interacting natural systems which include such components;


		
	(q)
	"Environmental Defect" means any Environmental Liabilities that would not be acceptable to a prudent purchaser of the Assets;


		
	(r)
	"Environmental Liabilities" means any and all environmental damage, contamination, or other adverse environmental conditions pertaining to or caused by any of the Assets or operations thereon or related thereto or existing within, upon or under the Lands, any lands upon which the Tangibles are located or any lands which are used to gain access to any of  the foregoing, however and by whomsoever caused, and whether caused by a breach of the applicable Regulations or otherwise, which occur or arise in whole or in part prior to, at or subsequent to Closing, and regardless of whether or not a reclamation certificate has been issued.  Without limiting the generality of the foregoing, such environmental damage or contamination or other environmental conditions shall include those arising from or relating to:


		
	(i) 
	surface, underground, air, ground water, surface water or marine environment contamination;


		
	(ii) 
	Abandonment and Reclamation Obligations;





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	(iii) 
	the breach of the applicable Regulations in effect at any time;


		
	(iv) 
	the removal of or failure to remove foundations, structures or equipment; 


		
	(v) 
	the release, spill, escape or emission of toxic, hazardous or oilfield waste substances; and 


		
	(vi) 
	damages and losses suffered by Third Parties as a result of any of the occurrences in Paragraphs (i) through (v) of this Subclause 1.1(r); 


		
	(s)
	"Escrow Agent" means the Person designated by the Parties as escrow agent to receive, manager, and administer the Section 116 Withholding Amount pursuant to the Section 116 Escrow Agreement;


		
	(t)
	"Excluded Assets" means the assets set forth on Schedule “G” hereto under the heading “Excluded Assets”;


		
	(u)
	"Facilities" means the facilities described in Schedule "E", excluding any facilities comprised in the Excluded Assets;


		
	(v)
	"GST" means the goods and services tax exigible under and administered pursuant to the Excise Tax Act (Canada);  


		
	(w)
	"Lands" means the lands described in Schedule "A" and includes the Petroleum Substances within, upon or under such lands insofar as the Petroleum Substances are granted by the Leases;


		
	(x)
	"Leases" means collectively the leases, reservations, permits, licenses or other documents of title described in Schedule "A" which grant rights to explore for, drill for, win, take or remove the Petroleum Substances, or any replacement or renewals thereof, leases derived therefrom, or subsequent leases or other documents of title;


		
	(y)
	"Licence Transfers" means, in relation to the Assets, the transfers of any permits, approvals, licenses and authorizations granted by any applicable governmental body;


		
	(z)
	"Losses" means all actions, causes of action, losses, costs, claims, damages, penalties, assessments, charges, expenses and other liabilities whatsoever suffered, sustained, paid or incurred and includes reasonable legal fees on a solicitor-and-client basis and other professional fees and disbursements on a full-indemnity basis; but notwithstanding the foregoing shall not include any liability for indirect or consequential damages including business loss, loss of profit, economic loss, punitive damages or income tax liabilities;


		
	(aa)
	"Miscellaneous Interests" means all property, assets and rights (other than the Petroleum and Natural Gas Rights and the Tangibles) pertaining to, but only to the extent to which they pertain to, the Petroleum and Natural Gas Rights, the Tangibles or any lands with which the Lands have been pooled or unitized, including Vendor's entire undivided interest in:





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	(i)
	all contracts, agreements and documents relating directly to the Petroleum and Natural Gas Rights and the Tangibles and any rights in relation thereto;


		
	(ii)
	all subsisting rights to enter upon, use and occupy the surface of any of the Lands or any lands upon which the Tangibles are located or lands which are used to gain access to any of the foregoing;


		
	(iii)
	all subsisting rights to carry out operations relating to the Lands or the Tangibles including all easements and well, pipeline, facility and other permits, licences and authorizations;


		
	(iv)
	all geological, engineering and other reports prepared for the joint account, i.e., prepared for all working interest owners, but not any other reports or interpretations or any other geophysical or geological data;


		
	(v)
	the Wells, including the wellbores of, and casings in, such Wells, but specifically excluding any wells comprised in the Excluded Assets;


		
	(vi)
	the Production Sales Contracts; and


		
	(vii)
	the Unit Interest;


		
	(bb)
	"Party" means any individual, partnership or corporation which is bound by this Agreement as Purchaser or Vendor;


		
	(cc)
	"Permitted Encumbrances" means:


		
	(i)
	easements, rights-of-way, servitudes and other similar rights in land including rights-of-way and servitudes for highways and other roads, railways, sewers, drains, gas and oil pipelines, gas and water mains , electric light, power, telephone, telegraph or cable television conduits, poles, towers, wires and cables;


		
	(ii)
	the right reserved to or vested in any government or other public authority by the terms of any statutory provision, to terminate any Leases or to require annual or other periodic payments as a condition of the continuance thereof;


		
	(iii)
	liens imposed by statute securing the payment of taxes or assessments which are not due or the validity of which Vendor is contesting in good faith;


		
	(iv)
	taxes on Petroleum Substances (excluding income taxes and GST) or the revenue therefrom and requirements imposed by statutes or governmental boards, tribunals or authorities concerning rates of production from operations on any of the Lands or otherwise affecting recoverability of Petroleum Substances from the Lands and which are generally applicable to the oil and gas industry in the jurisdiction in which the Assets are located;


		
	(v)
	the terms and conditions of all Leases or any operating agreements relating to the Assets (including Production Sales Contracts and pooling and 





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unitization agreements), provided that any burdens, encumbrances, adverse claims and reductions, conversions and alterations of interests are described in Schedule “A”;
		
	(vi)
	rights reserved to or vested in any municipality or governmental, statutory or public authority to control or regulate any of the Assets in any manner, and all applicable laws, rules and orders of any governmental authority;


		
	(vii)
	undetermined or inchoate liens (including processors', operators' and similar liens) incurred or created as security in favour of the person conducting the operation of any of the Assets, and arising in the ordinary course of business, for Vendor's proportionate share of the costs and expenses of such operations in respect of such costs which are not due or delinquent at the relevant time;


		
	(viii)
	mechanics', builders' or materialman's liens in respect of services rendered or goods supplied, but only insofar as such liens relate to goods or services for which payment is not due or the validity of which is being diligently contested by or on behalf of Vendor;


		
	(ix)
	the reservations, limitations, provisos and conditions in any original grants from the Crown of any of the Lands or interests therein, and statutory exceptions to title;


		
	(x)
	penalties which are described in Schedule "A" and which have arisen under operating procedures or similar agreements as a consequence of Vendor's elections at the relevant time to not participate in operations on the Lands to which the penalty applies;


		
	(xi)
	liens or securities incurred, created or granted in the ordinary course of business to a public utility, municipality or governmental authority in connection with operations pertaining to the Assets; and


		
	(xii)
	all royalty burdens (including lessor's royalties), liens, adverse claims and encumbrances described in Schedule "A";


		
	(dd)
	"Person" means any individual, personal representative, corporation, partnership or other legal entity capable of entering in to binding legal obligations;


		
	(ee)
	"Petroleum and Natural Gas Rights" means the undivided interests described in Schedule “A” including working interests, royalty interests, participation interests or any other interests in respect of the Leases and the Lands or lands with which the Lands are pooled or unitized, whether legal, beneficial or both;


		
	(ff)
	"Petroleum Substances" means petroleum, natural gas and all related hydrocarbons including all liquid hydrocarbons, and all other substances whether liquids, gases or solids and whether hydrocarbon or not (excepting coal but including sulphur), produced in association with such petroleum, natural gas or related hydrocarbons, the rights to which are granted by the Leases;





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	(gg)
	"Pipelines" means all pipelines set forth on Schedule "F", excluding any pipelines forming part of the Excluded Assets; 


		
	(hh)
	"Prime Rate" means a rate of interest per annum equal to the annual rate of interest which is announced from time to time by the Royal Bank of Canada in Calgary, Alberta, as its reference rate used for determining interest rates on Canadian dollar demand loans to its most credit-worthy customers;


		
	(ii)
	"Production Sales Contracts" means those contracts for the sale of Petroleum Substances produced from the Lands, or lands with which the Lands have been pooled or unitized, as described in Schedule "I";


		
	(jj)
	"Purchase Price" means the amount payable by Purchaser to Vendor pursuant to Subclause 2.2(a);


		
	(kk)
	"Regulations" means all statutes, laws, rules, orders, regulations, ordinances and other like instruments made from time to time by governments, governmental boards or agencies having jurisdiction over the Assets, the Parties or this Transaction;


		
	(ll)
	“Representatives” means, in respect of a Party:


		
	(i)
	such Party’s Affiliates; and


		
	(ii)
	the respective directors, officers, agents, employees, and consultants or advisors of such Party and its Affiliates; 


		
	(mm)
	"Right of First Refusal" means a right of first refusal, pre-emptive right of purchase or similar right whereby any Person has the right to acquire or purchase all or a portion of the Assets as a consequence of this Agreement or the Transaction herein contemplated;


		
	(nn)
	"RMF2" means the Alberta Energy Reassignment of Volume Setup/Change Form with all required attachments, to be submitted to Alberta Energy;


		
	(oo)
	"Security Interests" means any assignment, security, mortgage, charge, pledge, negative pledge, lien or other security interest whatever or however created or arising, whether absolute or contingent, fixed or floating, perfected or not, which encumbers all or any part or portion of Vendor's title in and to the Assets or any proceeds to be received hereunder, or that of its Affiliates or predecessors in title;


		
	(pp)
	"Section 116 Escrow Agreement" means the escrow agreement provided for in Clause 2.6, agreed to by the Parties as to both form and substance;


		
	(qq)
	"Take or Pay Obligations" means Vendor's outstanding obligations arising in connection with payments made to Vendor or to its predecessors in interest under or in respect of gas purchase contracts or other contracts for the sale of Petroleum Substances, which payments were made in lieu of or in consequence of the buyers under such contracts not taking delivery of Petroleum Substances, or in consideration of future deliveries of Petroleum Substances, and which obligations 





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include obligations to deliver Petroleum Substances after the Closing Date or to repay such payments after the Closing Date; 
		
	(rr)
	"Tangibles" means:


		
	(i)
	all tangible depreciable property and assets located in, on or about the Lands, or lands with which the Lands have been pooled or unitized, or which are appurtenant thereto and which are used in connection with production, gathering, processing, injection, removal, transmission or treatment of Petroleum Substances, or operations thereon or are relative thereto or are appurtenant to or are used in connection with the Wells, the Facilities, the Pipelines and the Unit, but excluding equipment beyond the point of entry into a gathering system, plant or other facility, and excluding all tangible depreciable property and assets comprising the Excluded Assets; 


		
	(ii)
	the Facilities; and 


		
	(iii)
	the Pipelines;


		
	(ss)
	"Title Defect"  means an actual or potential defect, deficiency, discrepancy or adverse claim in or affecting Vendor's title or its interests in and to any of the Assets, which is made apparent from Purchaser's inability, following a reasonable title review process, to confirm Vendor's title to the Assets or to confirm the extent to which Vendor's interest in the Assets may be subject to encumbrances, as Vendor's title and interests are disclosed herein or described in Schedule "A"; and which is or would be sufficiently material and adverse to the enforcement or defence of title and interests, or the confirmation of encumbrances, that it would not be acceptable to a knowledgeable and prudent purchaser buying similar oil and gas properties, acting reasonably, and includes Vendor not being the beneficial owner of the interest attributed to it in Schedule "A" or holding a lesser beneficial interest than the interest attributed to it, Vendor's interest as described in Schedule "A" being subject to a royalty, net carried interest or other encumbrance not being disclosed or being misdescribed in Schedule "A" (other than a Permitted Encumbrance) or Vendor's interest as described in Schedule "A" being subject to a production penalty or conversion that either has not been disclosed or has been misdescribed therein;


		
	(tt)
	"Transaction" means Vendor’s sale of the Assets to Purchaser, Purchaser’s purchase of the Assets from, and all other transactions and activities contemplated by this Agreement with respect thereto;


		
	(uu)
	"Unit" means the scheme or schemes of unitization for the production of Petroleum Substances to which the Petroleum and Natural Gas Rights are subject, set forth in Schedule "C";


		
	(vv)
	"Unit Agreement" means the agreement or agreements pursuant to which the Unit was formed, as amended;


		
	(ww)
	"Unit Facilities" means the facilities owned or operated by the Unit and defined as “Unit Facilities” pursuant to the terms of the Unit Operating Agreement;





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	(xx)
	"Unit Interest" means Vendor's entire interest in and to the Unit, including Vendor’s interests attributable to the Petroleum and Natural Gas Rights therein;


		
	(yy)
	"Unit Operating Agreement" means the Unit Operating Agreement referred to in the Unit Agreement, as amended;


		
	(zz)
	"Unit Wells" mean the producing, shut‐in, suspended, abandoned, water-source or injection wells comprised in the Unit;


		
	(aaa)
	"Vendor" means both Barnwell of Canada, Limited in its personal capacity as vendor of those Assets owned and held by it for and by itself, and Barnwell of Canada, Limited in its capacity as agent and attorney authorized and empowered to convey and transfer to Purchaser those Assets it holds in trust on behalf of other Persons; and


		
	(bbb)
	"Wells" mean the producing, shut‐in, suspended, water-source or injection wells described in Schedule “D”, and shall include all Unit Wells.


		
	1.2
	Schedules


The following schedules (the "Schedules") are attached to, form part of, and are incorporated into this Agreement:


		
	(a)
	Schedule "A": Petroleum and Natural Gas Rights (Leases, Lands, Vendor’s Interest, Encumbrances);


		
	(b)
	Schedule "B": Rights of First Refusal;


		
	(c)
	Schedule "C": Unit;


		
	(d)
	Schedule “D”: Wells;


		
	(e)
	Schedule "E": Facilities;


		
	(f)
	Schedule "F": Pipelines;


		
	(g)
	Schedule "G": Excluded Assets


		
	(h)
	Schedule “H”: AFEs;


		
	(i)
	Schedule "I": Production Sales Contracts;


		
	(j)
	Schedule "J": the form of the general conveyance; and


		
	(k)
	Schedule “K”: the form of the certificate to be provided pursuant to Article 10. 


		
	1.3
	References


The references "hereunder", "herein" and "hereof" refer to the provisions of this Agreement, and references to Articles, Clauses, Subclauses, Paragraphs or Subparagraphs herein refer to Articles, Clauses, 



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Subclauses, Paragraphs or Subparagraphs of this Agreement.  Any reference to time shall refer to Mountain Standard Time or Mountain Daylight Savings Time during the respective intervals in which each is in force.


		
	1.4
	Headings


The headings of the Articles, Clauses, Schedules and any other headings, captions or indices herein are inserted for convenience of reference only and shall not be used in any way in construing or interpreting any provision hereof.


		
	1.5
	Included Words


In this Agreement words importing the singular include the plural and vice versa, words importing one gender include other genders, words importing individuals also include firms and corporations and vice versa, as the context may require; and "including", "includes" and like terms mean "including without limitation" and "includes without limitation".


		
	1.6
	Knowledge and Awareness


Where in the Agreement a representation and warranty is made on the basis of Vendor's knowledge, such knowledge or awareness consists of the actual knowledge or awareness of Vendor's current officers and employees whether acting for the Vendor in its personal capacity or in its capacity as agent and attorney for the transfer and conveyance of the Assets, after having made reasonable inquiries and review of Vendor’s files or records, and does not include knowledge or awareness of any other Person.


		
	1.7
	Interpretation if Closing does not Occur


If Closing does not occur, each provision of this Agreement which presumes that Purchaser has acquired the Assets hereunder shall be construed as having been contingent upon Closing having occurred.


		
	1.8
	Invalidity of Provisions


If any of the provisions of this Agreement should be determined to be invalid, illegal or unenforceable in any respect, the validity, legality or enforceability of the remaining provisions herein shall not in any way be affected or impaired thereby provided there is no material and adverse effect to the bargain made between the Parties pursuant to this Transaction.





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	1.9
	Conflicts


If there is a conflict or inconsistency between the provisions of this Agreement and those of a Schedule, the provisions of this Agreement shall prevail.
		
	1.10
	Regulations


Any reference to a statute shall include and shall be deemed to be a reference to such statute and to the regulations made pursuant thereto, and all amendments made thereto and in force at the date hereof.
		
	1.11
	Negotiated Transaction  


The Parties have participated jointly in the negotiation and drafting of this Agreement and, in the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as having been jointly drafted by the Parties, and no presumption or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of any provision of this Agreement.




ARTICLE 2     
PURCHASE AND SALE


		
	2.1
	Purchase and Sale Agreement


Subject to the terms and conditions set forth herein, and for the consideration provided herein, Purchaser agrees to purchase the Assets from Vendor, and Vendor agrees to sell the Assets to Purchaser.


		
	2.2
	Purchase Price


		
	(a)
	The Purchase Price for the Assets is Twenty-Nine Million Six Hundred Thousand Dollars ($29,600,000.00), subject to the apportionments and adjustments provided for in Article 4 and such other reductions as may be made pursuant to Articles 7 and 8.


		
	(b)
	At Closing, in addition to the Purchase Price referred to in Subclause 2.2(a) above, Purchaser shall also remit to Vendor the five percent (5%) GST applicable to that portion of the Purchase Price allocated to the Miscellaneous Interests and Tangibles, being Two Hundred and Ninety-Six Thousand Dollars ($296,000.00).  Barnwell shall remit to the appropriate governmental agency on a timely basis all applicable GST. The GST registration number of Barnwell is 100401702 RT1001.




		
	2.3
	Allocation of Purchase Price


		
	(a)
	Vendor and Purchaser hereby allocate the Purchase Price among the Assets as follows:


(i)    to Petroleum and Natural Gas Rights         $23,680,000.00
(ii)    to Tangibles                    $  5,919,999.00
(iii)    to Miscellaneous Interests                     $                1.00
     Total                       $ 29,600,000.00



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	2.4
	Payment of Purchase Price


		
	(a)
	Subject to the withholding of the Section 116 Withholding Amount pursuant to Clause 2.6 which Purchaser shall pay to the Escrow Agent pursuant to Subclause 2.6(b)(ii), at Closing Purchaser shall pay to Vendor, by single bank draft or wire transfer, the Purchase Price owed to Vendor, as adjusted pursuant to this Agreement, and any GST thereon, together with any interest payable pursuant to Clause 2.5.  


		
	(b)
	Should any portion of the funds paid by Purchaser to Vendor under Subclause 2.4(a), including any interest in lieu set forth in Clause 2.5 below, be payable by Vendor to any Person under any trust, agency or power of attorney arrangement with such Person, upon receipt of funds from Purchaser pursuant to Subclause 2.4(a), Vendor shall promptly pay such Person its correct proportionate sum, subject to any withholding of the Section 116 Withholding Amount pursuant to Clause 2.6. This obligation shall be the sole responsibility of Vendor and shall survive Closing, and Vendor shall be liable for, and shall save, indemnify and hold harmless Purchaser from any Losses of any kind resulting from Vendor’s failure to fully perform such obligation.


2.5        Interest in Lieu


At Closing, Purchaser shall pay to Vendor an amount equal to the interest which would have accrued on the Purchase Price from and including the Effective Date to and including the day prior to the Closing Date, calculated daily at the Prime Rate from time to time during such period and not compounded.


2.6        Compliance Certificates and Withholding Tax


		
	(a)
	Each Party hereby authorizes the other Party to take any actions necessary to ensure full compliance with section 116 and all other provisions of the Income Tax Act (Canada) to the extent such compliance is made necessary by this Transaction, and shall provide to the other Party all reasonable assistance in respect thereof.  Specifically, Purchaser shall authorize and provide all necessary assistance to Vendor to enable Vendor to obtain, any and all correct and accurate certificates of compliance which may be required pursuant to subsection 116(4) of the Income Tax Act (Canada) (“Compliance Certificates”).




		
	 (b)
	Vendor and Purchaser acknowledge that pursuant to section 116 of the Income Tax Act (Canada) Purchaser is required to, and is authorized by Vendor to, withhold at Closing one half (1/2) of the Purchase Price net of apportionments and adjustments provided for in Article 3 (the "Section 116 Withholding Amount"). Vendor and Purchaser shall sign and deliver at Closing the Section 116 Escrow Agreement, which shall instruct the Escrow Agent with respect to the holding, remitting and releasing of the Section 116 Withholding Amount.




		
	(c)
	At Closing, Purchaser shall deliver to the Escrow Agent the Section 116 Withholding Amount to be held, released or remitted, as the case may be.





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	(d)
	Vendor acknowledges that it may be required to provide notice to the Canada Revenue Agency in respect of the sale of the Assets within ten (10) days of the date of such sale to avoid the imposition of a monetary penalty and, in addition, may be required to file a Canadian income tax return for the taxation year that includes the date of the sale of the Assets. Vendor shall fully comply on a timely basis with any such Canada Revenue Agency obligations, and shall be liable for and shall save, indemnify and hold Purchaser harmless from any loss, harm, prejudice or injury of any kind to Purchaser resulting from its failure to fully comply on a timely basis with such obligations.  




		
	(e)
	The obligations of the Parties pursuant to this Clause 2.6 shall survive Closing. 




		
	(f)
	Vendor’s Canada Revenue Agency assigned tax account number is 100401702RC0001.




ARTICLE 3     
CLOSING
		
	3.1
	Place of Closing


Unless the Parties otherwise agree, in writing, Closing shall take place at the Closing Time at Vendor's offices at Suite 2410, 500 – 4th Avenue SW in Calgary, Alberta.


		
	3.2
	Effective Date of Transfer


Provided that Closing occurs, the transfer and assignment of the Assets from Vendor to Purchaser shall be effective as of the Effective Date, provided that possession of the Assets shall not pass to Purchaser until Closing occurs.  In accordance with Clause 5, Vendor shall maintain the Assets on Purchaser's behalf between the Effective Date and the Closing.


		
	3.3
	Closing and Post-Closing Deliveries


		
	(a)
	At Closing, Barnwell shall execute, where applicable, and deliver to Purchaser:


		
	(i)
	a general conveyance, in the form attached as Schedule "J";


		
	(ii)
	all Conveyance Documents, including all RMF2s and AC2s, provided that such documents shall not require Vendor to assume or incur any obligation or to provide any representation or warranty beyond that contained in this Agreement;


		
	(iii)
	copies of all consents to disposition and applicable waivers of Rights of First Refusal obtained by Vendor with respect to this Transaction, other than customary post-closing consents;


		
	(iv)
	the certificate required by Subclauses 10.2(a) and (d) substantially in the form attached as Schedule “L”;





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	(v)
	"no interest" letters, and discharges of any Security Interests from the holder thereof; 


		
	(vi)
	receipt for payment of the amounts hereunder payable to Vendor by Purchaser at Closing; 


		
	(vii)
	the Section 116 Escrow Agreement; and


		
	(viii)
	such other documents as may be specifically required hereunder or as Purchaser may  reasonably request by reasonable notice to Vendor, including reasonable evidence of Vendor’s capacity and authority to convey and transfer all of the Assets to the Purchaser.


		
	(b)
	At Closing, Purchaser shall execute, where applicable, and deliver to Vendor:


		
	(i)
	the Purchase Price in accordance with Clause 2.2, subject to any adjustments provided for in this Agreement, the Section 116 Withholding Amount provided for in Clause 2.6, applicable GST, and the amount in interest in lieu in accordance with Clause 2.5;


		
	(ii)
	a general conveyance in the form attached as Schedule “J”;


		
	(iii)
	the certificate required by Subclause 10.3(d) substantially in the form attached as Schedule “K”; 


		
	(iv)
	 the Section 116 Escrow Agreement; and


		
	(v)
	such other documents as may be specifically required hereunder.


		
	(c)
	Five (5) Business Days before the Closing Date Vendor shall prepare and deliver drafts of the Conveyance Documents to Purchaser for Purchaser's review and approval.


		
	(d)
	Within fifteen (15) Business Days of the Closing Date, originals, or where originals are not available, copies of Vendor's records, files, reports and data pertaining to the Assets, insofar as such delivery is permitted and required hereunder, unless and to the extent to which Purchaser agrees to allow Vendor to deliver such records, files, reports and data at a later date.


		
	3.4
	Costs of Registration


Purchaser shall bear all costs incurred in registering all registrable Conveyance Documents and all costs of preparing and registering any further assurances documents required to convey the Assets to it.  Purchaser shall register all such conveyances promptly after Closing.





15




ARTICLE 4     
APPORTIONMENTS
		
	4.1
	Apportionments


		
	(a)
	Except as provided below in this Clause 4.1, the net amount of all benefits and obligations of every kind and nature relating to the operation of the Assets and accruing, payable or paid and received or receivable in respect of the Assets including mineral and surface lease rentals, property taxes, maintenance, development, capital and operating costs, gas cost allowances, proceeds from the sale of production, and revenues from processing and transportation fees charged to third parties (other than income taxes), shall be apportioned between the Parties as of the Effective Date, on an accrual basis regarding the interim statement of adjustments and on an actual basis regarding the final statement of adjustments.


		
	(b)
	An interim accounting and adjustment shall be conducted for Closing and Vendor shall prepare and forward a draft interim statement of adjustments to Purchaser not less than five (5) Business Days prior to the Closing Date, for Purchaser's review.


		
	(c)
	Within one hundred eighty (180) days of the Closing Date (the "Adjustment Period") Vendor shall prepare and forward to Purchaser a final accounting and adjustment (the "Final Statement of Adjustments" or the "FSOA").  Purchaser shall have thirty (30) days from receipt of the FSOA to review same.  Subject to Subclauses (d) and (e) of this Clause 4.1, settlement of accounts will be considered concluded when the Parties agree, evidenced by them signing the FSOA which expressly states that it is the final statement of all adjustments.  The Parties shall not be obligated to make any adjustments after the Adjustment Period unless such adjustment has been specifically requested, by notice, within the Audit Period as defined in Subclause (d) hereof.


		
	(d)
	During the one (1) year period following the date after which the Final Statement of Adjustments has been signed by both Parties (the "Audit Period"), Purchaser may audit Vendor's books, records and accounts respecting the Assets, for effecting adjustments pursuant to this Article 4.  Such audit shall be conducted upon reasonable notice to Vendor at Vendor's offices during Vendor's normal business hours, and shall be conducted at Purchaser's sole expense.  Any claims of discrepancies disclosed by such audit shall be made in writing to Vendor within thirty (30) days following the completion of such audit and Vendor shall respond in writing to any such claims of discrepancies within thirty (30) days of receipt of such claims.


		
	(e)
	Notwithstanding the preceding Subclauses of this Clause 4.1, any adjustments established by an audit conducted pursuant to the Regulations or the provisions of the Leases or governing agreements with respect to Crown Royalty audits, joint venture audits or thirteenth-month adjustments which are outstanding at the Closing Time, or which occur after the Closing Time, shall be made as they occur in accordance with the provisions of existing Regulations or governing agreements, and shall be received or paid by the Party thereto entitled or thereby obliged.





16




		
	(f)
	Vendor shall not be entitled to charge Purchaser for any of Vendor's administrative or overhead fees.


		
	(g)
	As required by law, GST shall be payable and applied to adjustments and shall be paid by the applicable Party.


		
	(h)
	Each Party agrees to make any payment required of it as a result of the adjustments provided for in this Clause 4.1 within thirty (30) days of being notified of the determination of the amount owing.


		
	(i)
	To the extent to which the Parties cannot agree to the accounting provided for in this Clause 4.1, either Party may refer the matter for determination in accordance with Article 9.


  
ARTICLE 5     
INTERIM PROVISIONS AND POST-CLOSING TRANSITION
		
	5.1
	Maintenance of Assets


From the time of the execution and delivery of this Agreement by the Parties until the earlier of the Closing Time or the termination of this Agreement, to the extent to which the nature of its interest permits and subject to the terms of this Agreement and to the Leases and any other agreements and documents to which the Assets are subject, Vendor shall use reasonable efforts to:


		
	(a)
	maintain the Assets in a proper and prudent manner in accordance with good oil and gas industry practices and in material compliance with all applicable Regulations;


		
	(b)
	maintain current insurance policies, if any;


		
	(c)
	pay or cause to be paid all costs and expenses relating to the Assets which become due from the date hereof to the Closing Date; and


		
	(d)
	perform and comply with all covenants and conditions in the Leases and any other agreements and documents to which the Assets are subject.




		
	5.2
	Material Commitments


		
	(a)
	From the date hereof to the Closing Time, Vendor shall not, without Purchaser's prior written consent:


		
	(i)
	voluntarily assume any obligation or commitment with respect to the Assets, where Vendor's share of the expenditure associated with such obligation or commitment is estimated to exceed $25,000.00;


		
	(ii)
	surrender or abandon any of the Assets;





17




		
	(iii)
	amend or terminate any Leases or any agreement to which the Assets are subject, or enter into any material new agreement respecting the Assets;


		
	(iv)
	subject to Subclause 5.2(b), propose or initiate the exercise of any right (including bidding rights at Crown sales, rights under area-of mutual-interest provisions and Rights of First Refusal) or option relative to the Assets, or arising as a result of the ownership of the Assets, or propose or initiate any operations on the Lands which Vendor has not commenced or committed to as of the date hereof or the Effective Date, if such exercise or option would result in Purchaser incurring an obligation hereunder after the Effective Date or a material adverse effect on the value of any of the Assets;


		
	(v)
	sell, transfer, surrender, abandon or otherwise dispose of the Assets, except to the extent required to comply with Rights of First Refusal;


		
	(vi)
	resign or take any action which would result in Vendor’s resignation or replacement as operator of any of the Assets for which Vendor is the current operator; or 


		
	(vii)
	grant a security or any encumbrance with respect to any of the Assets;




provided, however, that Vendor may assume such obligations or commitments and propose or initiate such operations or the exercise of any such right or option without Purchaser's prior consent if Vendor reasonably determines that such expenditures or actions are necessary for the protection of life or property or to otherwise deal with an emergency, in which case Vendor shall promptly notify Purchaser of such intention or actions and Vendor's estimate of the costs and expenses associated therewith.


		
	(b)
	If an operation or the exercise of any right or option available to Vendor with respect to the Assets is proposed in circumstances in which such operation or the exercise of such right or option would result in Purchaser incurring an obligation pursuant to Subclause 5.2(a), the following Paragraphs shall apply to such operation or the exercise of such right or option (hereinafter referred to as the "Proposal"):


		
	(i)
	Vendor shall promptly give Purchaser notice of the Proposal, describing the particulars in reasonable detail;


		
	(ii)
	Purchaser shall, not less than Twenty‐four (24) hours prior to the time Vendor is required to make its election with respect to the Proposal, advise Vendor, by notice, whether Purchaser wishes Vendor to exercise Vendor's rights with respect to the Proposal on Purchaser's behalf, provided that Purchaser's failure to make such election within such period shall be deemed to be Purchaser's election to participate in the Proposal;





18




		
	(iii)
	Vendor shall use all commercially reasonable efforts to make the election authorized by Purchaser with respect to the Proposal within the period during which Vendor may respond to the Proposal; and


		
	(iv)
	Purchaser's election to not participate in any Proposal required to preserve the existence of any of the Assets or to avoid a penalty or similar loss or cost shall not entitle Purchaser to any reduction of the Purchase Price by reason thereof, and such termination shall not constitute a failure of Vendor's representations and warranties pertaining to such Assets, notwithstanding Clause 6.3.


		
	5.3
	Post-Closing Transition 


Following Closing and to the extent to which Purchaser is required to be novated into operating agreements or other agreements or documents to which the Assets are subject, until the novation has been effected:


		
	(a)
	Vendor shall not initiate any operation with respect to the Assets, except upon receiving Purchaser's written instructions, or if Vendor reasonably determines that such operation is required for the protection of life or property or to otherwise deal with an emergency, in which case Vendor may take such actions as it reasonably determines are required without Purchaser's written instructions, but shall promptly notify Purchaser of such intention or actions and of Vendor's estimate of the costs and expenses associated therewith;


		
	(b)
	Vendor shall forthwith deliver to Purchaser all revenues, proceeds and other benefits received by Vendor with respect to the Assets during such post-closing period, provided that Vendor shall not be permitted to deduct from such revenues, proceeds and other benefits any other costs and expenses which it incurs as a result of such delivery to Purchaser; 


		
	(c)
	Vendor shall, in a timely manner, deliver to Purchaser:


		
	(i)
	all third party notices and communications received in respect of the Assets, including AFEs and mail ballots;




		
	(ii)
	all notices of any events or occurrences affecting the Assets, including:




		
	(A)
	any spill or other incident involving environmental damage, environmental contamination or other environmental problems relating to or caused by the Assets;




		
	(B)
	any order, directive or notification pursuant to the Regulations; and




		
	(C)
	any event or incident relating to a workplace safety hazard; and 




if received on a timely basis Vendor shall respond to such notices pursuant to Purchaser's written instructions, , provided that Vendor may refuse to follow any instructions which it reasonably believes to be unlawful, unethical or in conflict 



19




with any applicable agreement or contract, and provided that nothing shall preclude Vendor from taking such actions as Vendor reasonably determines are necessary for the protection of life or property, or as are required by the Regulations;


		
	(d)
	Vendor shall, in a timely manner, deliver to third parties all such notices and communications which Purchaser may reasonably request and all such monies and other items as Purchaser may reasonably provide in respect of the Assets, provided that Vendor may (but shall not be obligated to) refuse to follow instructions which it reasonably believes to be unlawful, unethical or in conflict with any applicable agreement or contract; 


		
	(e)
	until October 1, 2015, Vendor shall pay all rentals and similar payments required to preserve any of the Leases and any surface leases; 


		
	(f)
	where Vendor is the operator of the Assets, or any portion thereof, and in such capacity is responsible for the production accounting functions pertaining to the Assets, or any portion thereof, Vendor shall continue to perform such production accounting functions through September 30, 2015; and


		
	(g)
	the Parties acknowledge that Suncor Energy Marketing Inc. (“Suncor”) is currently holding, on Barnwell’s behalf, Nova Gas Transmission Limited firm service at a point known as the Dunvegan meter station #2044, pursuant to the Production Sales Contracts. To assist Purchaser to handle transition of these arrangements on a timely basis, within five (5) Business Days of the execution of this Agreement, Vendor shall authorize in writing Purchaser to communicate, negotiate and contract with Suncor directly to effect the appropriate transition arrangements Purchaser desires, and shall provide Purchaser with details of any upcoming renewals or terminations of such Production Sales Contracts. In addition, if any election is required to be made by Vendor with respect to such Production Sales Contracts prior to Closing, insofar as possible, Vendor shall make such election for Vendor in accordance with the instructions of Purchaser, and under no circumstance shall Barnwell allow service to expire under the Production Sales Contracts without the prior written approval of the Purchaser.


		
	5.4
	Licence Transfers


		
	(a)
	Within two (2) Business Days following Closing, Vendor shall prepare and, where applicable, electronically submit an application to the applicable governmental bodies for Licence Transfers and Purchaser or its nominee shall, where applicable, electronically ratify and sign such application.


		
	(b)
	If the AER or other governmental body denies a Licence Transfer because of misdescription or other minor deficiencies in the application, Vendor shall, within two (2) Business Days of such denial, correct the application and amend and re-submit the application for the Licence Transfer and Purchaser or its nominee shall, where applicable, electronically ratify and sign such application.


		
	(c)
	If, for any reason, the AER or other governmental body requires a Party or its nominee to make a deposit or furnish any other form of security in order to approve 





20




a Licence Transfer, such Party shall make such deposit or furnish such other form of security as is required and shall forthwith notify the other Party of such requirement.
		
	(d)
	If a Party fails to perform any obligations requested, ordered or directed by the AER or other governmental body respecting Environmental Liabilities, and the AER or other governmental body refuses to approve a Licence Transfer as a result thereof, the other Party shall be entitled to enter upon and access the Assets to perform such obligations for and on behalf of the first Party without liability by the other Party to the first Party for trespass or otherwise, and the first Party shall reimburse the other Party for all costs, charges and expenses incurred by the other Party in the performance of such obligations, by providing payment thereof to the other Party within thirty (30) days of the other Party's delivery to the first Party of an invoice for such costs, charges and expenses together with interest thereon at a rate equal to the sum of the Prime Rate plus a rate of two percent (2%) from the date at which such costs, charges and expenses are incurred or paid by the other Party until such reimbursement is made. Any costs incurred to address the foregoing obligations shall be adjusted between Vendor and Purchaser in accordance with Clause 4.1, provided, however, that penalties and like expenses and the interest payable under this Subclause 5.4(d) shall be to the account of the Party who failed to perform the obligations.


		
	5.5
	Vendor Deemed Purchaser's Agent


		
	(a)
	Insofar as Vendor maintains the Assets and takes actions thereto on Purchaser's behalf pursuant to this Article 5, Vendor shall be deemed to have been Purchaser's agent hereunder.  Purchaser ratifies all actions taken by Vendor or refrained from being taken by Vendor pursuant to this Article 5 in such capacity during such period, with the intention that all such actions shall be deemed to be Purchaser's.


		
	(b)
	Insofar as Vendor participates in either operations or the exercise of rights or options as Purchaser's agent pursuant to this Article 5, Vendor may require Purchaser to secure costs to be incurred by Vendor on Purchaser's behalf pursuant to such election in such manner as may be reasonably appropriate in the circumstances.


		
	(c)
	Purchaser shall indemnify Vendor and its Representatives against all Losses which Vendor or Representatives may suffer or incur as a result of Vendor maintaining the Assets as Purchaser's agent pursuant to this Article 5, insofar as such Losses are not a direct result of the gross negligence or wilful misconduct of Vendor or of its Representatives.  An action or omission of Vendor or of Representatives shall not be regarded as gross negligence or wilful misconduct to the extent to which it was done or omitted from being done in accordance with Purchaser's instructions or concurrence.


		
	5.6
	Transfer of Operatorship


Purchaser acknowledges that Vendor may not be able to transfer operatorship of some or all of the Assets to Purchaser at or after Closing.  Vendor covenants with Purchaser that Vendor shall 



21




reasonably cooperate with Purchaser to obtain appropriate consents and approvals for the assignment and transfer to Purchaser of operatorship of those of the Assets of which Vendor is currently the Operator.


		
	5.7
	Removal of Signs


At and after Closing, Vendor may remove any signs which indicate its ownership or operation of the Assets.  Purchaser will be responsible for erecting or installing signs required by governmental agencies to indicate that Purchaser is the operator of the Assets and to notify other working interest owners, gas purchasers, suppliers, contractors, governmental agencies and other Persons of Purchaser's interest in the Assets on and after Closing.


ARTICLE 6     
REPRESENTATIONS AND WARRANTIES
		
	6.1
	Representations and Warranties of Vendor


As of the date hereof, Barnwell of Canada, Limited represents and warrants to Purchaser (unless otherwise specified herein, in both its personal capacity and in its capacity as agent and attorney on behalf of other Persons) that with respect to the transfer and conveyance of the Assets:


		
	(a)
	Corporate Standing:  Vendor is a corporation duly incorporated and validly subsisting under the laws of its jurisdiction of incorporation and is authorized to carry on business in the jurisdiction(s) in which the Assets are located;


		
	(b)
	Requisite Authority:  Vendor has taken all necessary corporate action and has all requisite power and authority to enter into this Agreement and to perform its obligations under this Agreement, and where Vendor acts herein in the capacity as agent and attorney on behalf of other Persons for the transfer and conveyance of their interests in and to the Assets, Vendor represents that such right, power and authority has been duly and properly delegated to Vendor in accordance with a power of attorney duly executed by such Persons that at the date of this Agreement is, and at the date of Closing remains, a legally enforceable power of attorney authorizing and empowering Vendor with all right, power and authority to sell such Assets to Purchaser in accordance with the terms of this Agreement and to fulfill and perform all obligations provided herein;


		
	(c)
	Execution and Enforceability of Documents:  this Agreement and all other documents contemplated herein have been duly executed and delivered by Vendor and:


		
	(i)
	 constitute legal, valid, binding and enforceable obligations of Vendor in both its personal capacity or in its capacity as agent and attorney, as the case may be; and 


		
	(ii)
	constitute legal, valid, binding and enforceable obligations of against those Persons for whom Vendor acts hereunder as agent and attorney for the sale of their Assets hereunder;





22




		
	(d)
	No Conflicts:  Vendor's consummation of the Transaction herein contemplated will not, in any material respects, violate or conflict with any of Vendor’s constating documents, by‐laws or governing documents, or with any provision of any material agreement or instrument to which Vendor is party or by which Vendor or the Assets is bound, or with any judgment, decree, order, statute, rule or Regulation applicable to Vendor or the Assets;


		
	(e)
	Residency:  Vendor is a non‐resident of Canada within the meaning of section 116 of the Income Tax Act (Canada), and Vendor has, and shall have at Closing, complied with any requirements of the Income Tax Act (Canada) that may be applicable at that time, when and to the extent that this Transaction is subject to the requirements thereof;


		
	(f)
	Title:  although Vendor does not warrant title to the Assets and except for Permitted Encumbrances;


		
	(i)
	it has done no act or thing and is aware of no circumstance, matter, document or thing whereby any of the Assets may be cancelled or determined and the Assets are free and clear of any and all encumbrances and Security Interests;


		
	(ii)
	other than as described in Schedule "A", none of the Petroleum and Natural Gas Rights are subject to reduction or conversion by reference to payout of any well or otherwise; and


		
	(iii)
	subject to the rents, covenants, conditions and stipulations in the Leases and any other agreements pertaining to the Assets and on the lessee's or holder's part thereunder to be paid, performed and observed, Purchaser may enter into and upon, and hold and enjoy the Assets for the residue of the respective terms of the Leases, such other agreements relating to the Assets and all renewals or extensions thereof as to the interests hereunder assigned, for Purchaser's own use and benefit without any interruption of or by Vendor or any other Person whomsoever claiming by, through or under Vendor, including any Persons for whom Vendor acts as agent and attorney for the transfer and conveyance of the Assets;


		
	(g)
	No Knowledge of Defaults:  Vendor has no knowledge of, nor has it been informed of, any material default or notice of material default relating to the Assets, or any of them;


		
	(h)
	Finders' Fees:  Vendor has not incurred any obligation or liability, contingent or otherwise, for brokers' or finders' fees in respect of the Transaction for which Purchaser shall have any obligation or liability;


		
	(i)
	No Lawsuits or Claims:  there are no claims, proceedings, actions, lawsuits, administrative proceedings or governmental investigations in existence, contemplated or threatened against or with respect to Vendor in either its personal capacity or its capacity as agent and attorney for the transfer and conveyance of the Assets, or with respect to the Assets;





23




		
	(j)
	Payment of Taxes:  all ad valorem, property, production, severance and similar taxes and assessments based on or measured by the ownership of the Assets or the production of Petroleum Substances therefrom or the receipt of proceeds therefrom payable by Vendor prior to the Effective Date and for all prior years have been properly and timely paid and discharged;


		
	(k)
	Payment of Royalties:  all rentals, royalties and other amounts due under the Leases and payable by Barnwell prior to the Effective Date and for all prior years have been properly and timely paid and discharged;


		
	(l)
	Compliance:   Vendor has complied with, performed, observed and satisfied all material terms, conditions, obligations and liabilities which have heretofore arisen and were Barnwell's obligations under any of the provisions of any agreement affecting the Assets or any then-existing statute, order, writ, injunction or decree of any governmental agency or court relating to the Assets;


		
	(m)
	Documents:  Vendor has made all reasonable inquiries and searches for material documents and information, it has delivered or made available to Purchaser all documents, instruments, records and books relevant to Barnwell's title to the Lands and the Leases and in Barnwell's possession or to which it has reasonable access;


		
	(n)
	Worker's Compensation:  Vendor is not in default of any amounts required to be paid to any workers’ compensation board under any applicable laws or the Regulations, for which Purchaser shall have any obligation or liability;


		
	(o)
	AFEs:  other than the AFEs described in Schedule “H”, there are no outstanding AFEs applicable to the Assets;


		
	(p)
	Material Contracts:  except for the Production Sales Contracts described in Schedules “C”, “G” and “I”, there are no:


		
	(i) 
	gas balancing or similar agreements pertaining to the Petroleum Substances or any of them;


		
	(ii) 
	agreements for the sale, dedication, transportation, processing or disposal of the Petroleum Substances or any of them, or substances produced in connection with the Petroleum Substances or any of them; or


		
	(iii) 
	agreements for the contract operation by any Person of the Assets or any of them;


		
	(q)
	Operations:   


		
	(i)
	where Vendor is or has been the operator, all operations related to the Assets have been conducted in compliance with the Regulations and in accordance with good oil and gas industry practices; and 





24




		
	(ii)
	where Vendor is not the operator, to Barnwell’s knowledge, all operations related to the Assets have been conducted in compliance with the Regulations and in accordance with good oil and gas industry practices; 


		
	(r)
	Environmental:  Vendor is not aware of and has not received:


		
	(i)
	any claims, orders or directives which relate to environmental matters or Environmental Liabilities and which require any work, repairs, construction or capital expenditures with respect to the Assets, where such orders or directives have not been complied with; or


		
	(ii)
	any claims, demands or notices issued with respect to the breach of any environmental, health or safety law applicable to the Assets, including without limitation, respecting the use, storage, treatment, transportation or disposition of environmental contaminants, which demand or notice remains outstanding;


		
	(s)
	Area of Mutual Interest:  At Closing, the Assets will not be subject to any agreements which provide for areas of mutual interest or areas of exclusion;


		
	(t)
	Take or Pay Obligations:  the Assets are not subject to any outstanding Take or Pay Obligations;


		
	(u)
	Rights of First Refusal:  the Assets are not subject to any operative Rights of First Refusal of third Persons except for those set forth in Schedule “B”;


		
	(v)
	Penalties:  except as described in Schedule "A", Vendor has not elected or refused to participate in any exploration, development or other operation on the Lands, which has given or may give rise to penalties or forfeitures;


		
	(w)
	Production Penalties:  except as described in Schedule "A", the Wells are not subject to any production penalty or similar production restriction of any nature and Vendor has not received notice of any change or proposed change in the government-established production allowables for any of the Wells that are not generally applicable;


		
	(x)
	Offset Obligations:  to Vendor’s knowledge, there are no offset obligations arising under any of the Leases, including any unsatisfied obligation to drill a well or surrender rights or an obligation to pay compensatory royalties;


		
	(y)
	No Excluded Assets:  there are no Miscellaneous Interests or Tangibles excluded from the Assets except those set forth in Schedule “G”;


		
	(z)
	Condition of Tangibles:  Vendor’s interest in and to all property, assets, interests and rights comprising the Tangibles is equivalent to Vendor’s interest in and to the corresponding Petroleum and Natural Gas Rights and, to Vendor’s knowledge, the Tangibles have been constructed, maintained and operated in accordance with good oil and gas field practices and with the material requirements of the Regulations and none of the Tangibles is leased or rented;





25




		
	(aa)
	Material Loss or Damage: there has been no change in the Assets subsequent to the Effective Date other than in consequence of and in the ordinary course of operation and production which has or would have a material adverse effect on the value, use or operation thereof;




		
	(bb)
	Well Abandonment:  Barnwell has not received notice under the Regulations to abandon any Well which has not been properly abandoned in accordance with the Regulations; and 


		
	(cc)
	Licensee Liability Rating:  where Barnwell is the licensee of the Wells and a registrant with the AER, Barnwell’s Licensee Liability Rating:


		
	(i)
	at the date this Agreement is executed, is greater than or equal to 1.0;


		
	(ii)
	as a result of the consummation of this Transaction, shall continue to be greater than or equal to 1.0; and


		
	(iii)
	at the time the AER considers approval of any Conveyance Documents that require its approval, shall be greater than or equal to 1.0.




		
	6.2
	Purchaser's Representations and Warranties


As of the date hereof, Purchaser represents and warrants to Vendor that:


		
	(a)
	Corporate Standing:  Purchaser is a corporation, duly incorporated and validly subsisting under the laws of the jurisdiction of its formation incorporation, and is authorized to carry on business in all jurisdictions in which the Assets are located;


		
	(b)
	Requisite Authority:  Purchaser has taken all necessary corporate action and has all requisite power and authority to enter into this Agreement and to perform its obligations under this Agreement;


		
	(c)
	Execution and Enforceability of Documents:  this Agreement and all other documents contemplated herein have been duly executed and delivered by Purchaser and constitute legal, valid, binding and enforceable obligations of Purchaser;


		
	(d)
	No Conflicts:  Purchaser's consummation of the transaction herein contemplated will not, in any material respects, violate or conflict with any of Purchaser's constating documents, by‐laws or governing documents or with any provision of any material agreement or instrument to which Purchaser is a party or by which Purchaser is bound, or with any judgment, decree, order, statute, rule or regulation applicable to Purchaser;


		
	(e)
	Finders' Fees:  Purchaser has not incurred any obligation or liability, contingent or otherwise, for brokers' or finders' fees in respect of the transaction herein contemplated for which Vendor shall have any obligation or liability; 


		
	(f)
	Investment Canada:  Purchaser is not a "non‐Canadian" under the Investment Canada Act; and





26




		
	(g)
	Licensee Liability Rating:  Purchaser is a registrant with the AER, and Purchaser’s Licensee Liability Rating:


		
	(i)
	at the date this Agreement is executed, is greater than or equal to 1.0;


		
	(ii)
	as a result of the consummation of this Transaction, shall continue to be greater than or equal to 1.0; and


		
	(iii)
	at the time the AER considers approval of any Conveyance Documents that require its approval, shall be greater than or equal to 1.0.




		
	6.3
	Survival of Representations and Warranties


Each Party acknowledges that the other may rely on the representations and warranties made by it pursuant to Clauses 6.1 or 6.2,, as applicable. Subject to Paragraph 5.2(b)(iv), and except as otherwise specifically stated, the representations and warranties shall be true on the date of this Agreement and on the Closing Date, and shall continue in full force and effect and shall survive the Closing Date for a period of twelve (12) months thereafter for the benefit of the Party in favour of whom such representations and warranties were made.


		
	6.4
	No Additional Representations or Warranties


Vendor makes no representations or warranties to Purchaser other than those expressly enumerated in Clauses 6.1 and 6.2.  Specifically, Vendor does not warrant title to the Assets or make representations or warranties with respect to:  
		
	(a) 
	the quantity, quality or recoverability of Petroleum Substances respecting the Lands and comprised within the Assets;


		
	(b) 
	any estimates of the value of the Assets or the revenues applicable to future production of Petroleum Substances from the Lands; 


		
	(c) 
	any engineering, geological or other interpretations or economic evaluations respecting the Assets; 


		
	(d) 
	the rates of production of Petroleum Substances from the Lands; and


		
	(e) 
	the quality, condition, marketability or serviceability of the Assets or their suitability of use for any purpose.


Without restricting the generality of the foregoing, Purchaser acknowledges and confirms to Vendor that it has made its own independent investigation, analysis, evaluation and inspection of the Assets and the state and condition thereof, and that Purchaser has relied solely on such investigation, analysis, evaluation and inspection as to its assessment of the condition, quantum and value of the Assets except to the extent a representation and warranty has been made by Vendor that expressly applies with respect thereto.





27




ARTICLE 7     
THIRD PARTY RIGHTS AND CONSENTS
		
	7.1
	Preferential Rights of Purchase


		
	(a)
	If any of the Assets is subject to a Right of First Refusal, or if the disposition herein requires the consent of any third party which can be unreasonably withheld, Vendor shall comply with the terms of the provisions relating to any Right of First Refusal or consent and shall promptly serve all such notices as are required under such provisions, in accordance with the terms and conditions of any such Right of First Refusal and consent.  Unless Purchaser otherwise agrees, each such notice shall include a request for a waiver of any Right of First Refusal to purchase any of the Assets and for the granting of any consent that may be required.  From time to time, at Purchaser’s request, Vendor shall advise Purchaser of the status of any consent or Right of First Refusal.  At Closing, Vendor shall deliver to Purchaser evidence that all such Rights of First Refusal have been complied with and either have been exercised or waived or have expired by the effluxion of time.


		
	(b)
	Within two (2) days after the execution of this Agreement, Purchaser, acting reasonably, shall advise Vendor in writing of Purchaser's bona fide allocation of a portion of the Purchase Price to the Assets which are subject to the Right of First Refusal and except if modified by agreement or an Alberta court of competent jurisdiction by reason of a dispute, such bona fide allocation shall be used for the purposes of this Clause 7.1. Purchaser shall derive such allocation by using good-engineering practices and the value allocated shall have a commercially reasonable basis.


		
	(c)
	If a Right of First Refusal is exercised, Vendor shall comply with such Right of First Refusal, and shall transfer those of the Assets which are subject to the Right of First Refusal to all holders of the Right of First Refusal which exercised their right.


		
	(d)
	If a holder of any Right of First Refusal to purchase any of the Assets exercises such right, that fact shall not be considered a Title Defect and the Assets subject to such Right of First Refusal exercised in accordance with its terms shall cease to be subject to this Agreement and all definitions set forth herein shall be and shall be deemed to be amended accordingly, the Purchase Price and allocation set forth in Clause  2.3 shall be reduced in accordance with the value ascribed to same in Subclause 7.1(b), (or the value modified by agreement or an Alberta court of competent jurisdiction should that be the case), and the Parties shall proceed with Closing for the Assets which remain unaffected by such exercised Rights of First Refusal.


		
	(e)
	If a holder of any Right of First Refusal exercises a Right of First Refusal and is then unable or unwilling to enter in to a conveyance agreement with Vendor to acquire the relevant Assets, Purchaser shall accept a conveyance of such Assets for the amount that would have been payable by the purchaser of such Assets pursuant to Subclause 7.1(b) and under the same terms and conditions as provided in this Agreement, including provision for the appropriate Section 116 Withholding Amount for such Assets, provided that Purchaser shall not be required to accept such a conveyance more than one hundred and eighty (180) days following the 





28




Closing Date. Any conveyance to Purchaser pursuant to this Subclause 7.1(e) shall be subject to the rights of any other Right of First Refusal holders who have also exercised their Right of First Refusal with respect to the same Assets and who, accordingly, have a right to acquire their proportionate share of such Assets.
		
	(f)
	Purchaser shall be liable to Vendor for and shall in addition indemnify and hold Vendor harmless from and against all Losses which arise from any matter or thing occurring or arising, through or attributable to the allocations provided by Purchaser to Vendor for the purposes of this Article 7, whether or not such allocations are reasonable.




ARTICLE 8     
PURCHASER'S REVIEW
		
	8.1
	Title Review 


Vendor shall, subject to the Regulations and all contractual and fiduciary obligations and limits, at Vendor's office during normal business hours, provide Purchaser and its nominees with reasonable access to Vendor's records, files and documents including the Leases and applicable operating agreements, well licences, overriding royalty agreements and production sale contracts, which directly relate to the Assets, for Purchaser's review of the Assets and of Vendor's title thereto.


		
	8.2
	Title Defects


No less than five (5) Business Days prior to the Closing Date, Purchaser may give Vendor written notice of Title Defects, which written notice shall include a description of each Title Defect and the Assets affected thereby; the value allocated by Purchaser, acting reasonably, to each affected Asset; and the amount, in Purchaser's reasonable opinion, by which the value of each affected Asset has been reduced by the Title Defect.  Failure to include a Title Defect in a written notice shall be deemed to be a waiver of such Title Defect for the purposes of this Clause 8.2.


		
	8.3
	Vendor's Rectification


Prior to the Closing Date, Vendor shall use all commercially reasonable efforts to cure or rectify the Title Defects of which Purchaser has given notice pursuant to Clause 8.2.  Insofar as the Title Defects described in Purchaser’s written notice have not been cured, to Purchaser's reasonable satisfaction, not less than two (2) Business Days prior to the Closing Date:


		
	(a)
	where the cumulative value of the affected Assets is less than Five percent (5%) of the Purchase Price, Purchaser shall be obligated to complete the purchase of the Assets without adjustment of the Purchase Price on account of Title Defects; 


		
	(b)
	where the cumulative value of the affected Assets  is Five percent (5%) or more of the Purchase Price, the Purchase Price shall be reduced by such amount and Purchaser shall be obligated to proceed to purchase the Assets at the reduced Purchase Price; or





29




		
	(c)
	where the cumulative value of the affected Assets is Twenty percent (20%) or more of the Purchase Price, either Purchaser or Vendor may terminate this Agreement by providing written notice to the other Party one (1) Business Day prior to the Closing Date, in which case the Parties shall have no further obligation to each other, except for obligations arising pursuant to Article 11.  If neither Party provides such written notice to terminate, the Purchase Price shall be reduced by such amount and Purchaser shall be obligated to proceed to purchase the Assets at the reduced Purchase Price.


		
	8.4
	Value Disputes


If Vendor disagrees with Purchaser's value allocated to an affected Asset or the amount by which the value of each affected Asset has been reduced by each uncured Title Defect according to Purchaser’s allocations in Clause 8.2, the Parties shall forthwith meet in good faith to discuss the issue.  If after such a meeting the issue has not been resolved or if a Party refuses to meet to discuss the issue, the Parties shall refer the issue to a mutually-agreeable independent engineering consulting firm (the "Title Valuation Referee") for determination.  The Parties shall provide all materials relevant to the issue to the Title Valuation Referee within two (2) days of the issue being referred to the Title Valuation Referee.  The Parties shall direct the Title Valuation Referee to provide its decision regarding such issue within five (5) days after its receipt of all relevant materials.  The Title Valuation Referee shall act as an expert for the limited purpose of determining the specific issues submitted and may not award damages or penalties to either Party with respect to any matter.  Vendor and Purchaser shall equally share the Title Valuation Referee’s costs, fees and expenses (including reasonable legal fees).  The Title Valuation Referee’s decision shall be given in writing to the Parties, shall be binding upon and non-appealable by the Parties, and shall not be subject to further review, audit or arbitration.
		
	8.5
	Environmental Review


Vendor shall, subject to the Regulations and all contractual and fiduciary obligations and limits, provide Purchaser and its nominees with a reasonable opportunity to inspect the Assets at Purchaser's sole cost, risk and expense, insofar as Vendor can reasonably provide such access to the Assets.  Purchaser may conduct an environmental assessment of the Assets not operated by Purchaser or an Affiliate thereof.  Purchaser shall pay the costs of the environmental review.  The environmental review shall be completed no later than seven (7) Business Days prior to the Closing Date and shall be undertaken in a manner that does not unduly interfere with operations. Vendor shall provide assistance to Purchaser in gaining access to any Assets not operated by Vendor which Purchaser wishes to review, by making a request to the relevant operator in that regard.


		
	8.6
	Environmental Defects


Purchaser may give Vendor notice of Environmental Defects from time to time as soon as is reasonably practicable after Purchaser's determination thereof.  No later than five (5) Business Days prior to the Closing Date, Purchaser may give Vendor written notice of Environmental Defects, which written notice shall include a description of each Environmental Defect and the Assets affected thereby; the value allocated by Purchaser, acting reasonably, to each affected Asset; and the amount, in Purchaser's reasonable opinion, by which the value of each affected Asset has been reduced by the Environmental Defect.  Failure to include an Environmental Defect in a written notice shall be deemed to be a waiver of such Environmental Defect for the purposes of this Clause 8.6.





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	8.7
	Vendor's Rectification 


Prior to the Closing Date, Vendor shall use all commercially reasonable efforts to cure or rectify the Environmental Defects of which Purchaser gives notice pursuant to Clause 8.6.  Insofar as the Environmental Defects described in Purchaser’s written notice have not been cured to Purchaser's reasonable satisfaction two (2) Business Days prior to the Closing Date:


		
	(a)
	where the cumulative value of the affected Assets is less than Five percent (5%) of the Purchase Price, Purchaser shall be obligated to complete the purchase of the Assets without adjustment of the Purchase Price on account of Title Defects; 


		
	(b)
	where the cumulative value of the affected Assets  is Five percent (5%) or more of the Purchase Price, the Purchase Price shall be reduced by such amount and Purchaser shall be obligated to proceed to purchase the Assets at the reduced Purchase Price; or


		
	(c)
	where the cumulative value of the affected Assets is Twenty percent (20%) or more of the Purchase Price, either Purchaser or Vendor may terminate this Agreement by providing written notice to the other Party one (1) Business Day prior to the Closing Date, in which case the Parties shall have no further obligation to each other, except for obligations arising pursuant to Article 11.  If neither Party provides such written notice to terminate, the Purchase Price shall be reduced by such amount and Purchaser shall be obligated to proceed to purchase the Assets at the reduced Purchase Price.





31




		
	8.8
	Value Disputes


If Vendor disagrees with Purchaser's value allocated to an affected Asset or the amount by which the value of each affected Asset has been reduced by each uncured Environmental Defect according to Purchaser’s allocations in Clause 8.2, the Parties shall forthwith meet in good faith to discuss the issue.  If after such a meeting the issue has not been resolved or if a Party refuses to meet to discuss the issue, the Parties shall refer the issue to a mutually-agreeable independent environmental consulting firm (the "Environmental Valuation Referee") for determination.  The Parties shall provide all materials relevant to the issue to the Environmental Valuation Referee within three (3) Business Days of the issue being referred to the Environmental Valuation Referee.  The Parties shall direct the Environmental Referee to provide its decision regarding such issue within five (5) Business Days after its receipt of all relevant materials.  The Environmental Referee shall act as an expert for the limited purpose of determining the specific issues submitted and may not award damages or penalties to either Party with respect to any matter.  Vendor and Purchaser shall equally share the Environmental Referee’s costs, fees and expenses (including reasonable legal fees).  The determination of the Environmental Referee’s decision shall be given in writing to the Parties, shall be binding upon and non-appealable by the Parties, and shall not be subject to further review, audit or arbitration.  
ARTICLE 9     
ARBITRATION
		
	9.1
	Reference to Arbitration


		
	(a)
	Insofar as the Parties are unable to agree on any matter which expressly may be referred to arbitration hereunder, either Party may serve the other Party written notice that it wishes such matter referred to arbitration.


		
	(b)
	The Parties shall meet within seven (7) days of the receipt of a notice issued pursuant to Subclause 9.1(a), to attempt to agree on a single arbitrator qualified by experience, education and training, to determine such matter.  If the Parties are unable to agree on the selection of the arbitrator, the Party which issued such notice shall forthwith make application to a judge of the Court of Queen's Bench of the Province of Alberta pursuant to the Arbitration Act (Alberta) for the appointment of a single arbitrator, and failing such action on the part of the Party which issued such notice, the other Party may make such application.


		
	9.2
	Proceedings


		
	(a)
	The arbitrator selected pursuant to Clause 9.1 shall proceed as soon as is practicable to hear and determine the matter in dispute.  The Parties shall direct the arbitrator to provide the Parties with a written decision respecting such matter within forty‐five (45) days of the arbitrator’s appointment.  The Parties shall provide such assistance and information as may be reasonably necessary to enable the arbitrator to make its decision.


		
	(b)
	Except to the extent modified by this Article 9, the arbitrator shall conduct any arbitration hereunder pursuant to the provisions of the Arbitration Act (Alberta).





32




		
	9.3
	Compensation


The compensation and expenses of the arbitrator shall be borne equally by the Vendor and the Purchaser.


ARTICLE 10     
CONDITIONS TO CLOSING
		
	10.1
	Required Approvals


It is a condition precedent to Closing that any and all approvals and authorizations required under the Regulations prior to Closing (including any approval required under the Investment Canada Act) be obtained by Closing, other than any approval required for the transfer of a well licence from Vendor to Purchaser.  After Closing, each of the Parties shall use all reasonable efforts to obtain any approvals and authorizations required or advisable thereafter in respect of this Transaction, and in addition shall make, or cause to be made, all regulatory or statutory filings and notifications required of it or its Affiliates following Closing, whether specifically provided for herein or not.  The Parties hereby acknowledge that the consent of buyers under Production Sales Contracts may not be obtainable until after Closing and that such consents shall not be a condition precedent to Closing.


		
	10.2
	Conditions for Purchaser's Benefit


Purchaser’s obligation to complete the purchase hereunder is subject to the following conditions precedent:


		
	(a)
	No Substantial Damage:  there shall have been no damage to or alteration of any of the Assets between the date of this Agreement or the Effective Date, whichever is earlier, and the Closing Time which, in Purchaser's reasonable opinion, would materially and adversely affect the value of the Assets, except as and to the extent approved in writing by Purchaser, and Vendor shall have delivered to Purchaser Vendor’s certificate, substantially in the form of Schedule "K" dated as of the Closing Date, that there has been no such damage to or alteration of any of the Assets during such period, provided that a change in the prices at which Petroleum Substances may be sold shall in no event be regarded as material damage to or an alteration of the Assets;


		
	(b)
	Availability of Documents:  pursuant to Article 8, Vendor shall have provided Purchaser and its nominees with reasonable access to all of Vendor's records and documents pertaining to the Assets, in order for Purchaser and its agents to confirm Vendor's title to the Assets;


		
	(c)
	Vendor's Material Compliance:  Vendor shall have delivered to Purchaser a certificate in the form of Schedule "K", dated as of the Closing Date, stating that in all material respects, Vendor has performed or complied with each of the terms, covenants and conditions of this Agreement to be performed or complied with by Vendor at or prior to the Closing;





33




		
	(d)
	Representations Correct:  Vendor shall have delivered to Purchaser its certificate in the form of Schedule "K", dated as of the Closing Date, stating that each of the representations and warranties contained in Clause 6.1, as of the date of this Agreement was, and on the Closing Date is, true and correct in all material respects;


		
	(e)
	Delivery of Conveyance Documents:  Vendor shall have delivered to Purchaser those documents and materials described in Subclause 3.3(a); 


		
	(f)
	Rights of First Refusal:  At least two (2) Business Days prior to the Closing Date, all Rights of First Refusal shall have been determined by both Parties to be inapplicable, waived or exercised, or shall have expired by the effluxion of time; and


		
	(g)
	Delivery of Section 116 Escrow Agreement:  Vendor shall have delivered to Purchaser at least one (1) copy of the Section 116 Escrow Agreement referred to in Clause 2.6 hereof, in a form and substance agreed to by the Parties prior to Closing.


		
	10.3
	Conditions for Vendor's Benefit


Vendor’s obligation to complete the sale hereunder is subject to the following conditions precedent:


		
	(a)
	Payment of Purchase Price:  Purchaser shall have tendered to Vendor the Purchase Price and applicable GST in the manner provided for in Clause 2.3, subject to any adjustments provided for in Article 4, and interest in lieu provided for in Clause 2.5;


		
	(b)
	Purchaser's Material Compliance:  Purchaser shall have delivered to Vendor Purchaser’s certificate, in the form of Schedule "K" dated as of the Closing Date, to the effect that in all material respects, Purchaser shall have performed or complied with each of the terms, covenants and conditions of this Agreement to be performed or complied with by Purchaser at or prior to the Closing Time;


		
	(c)
	Representations Correct:  Purchaser shall have delivered to Vendor Purchaser’s certificate, in the form of Schedule "K", dated as of the Closing Date, stating that each of the representations and warranties contained in Clause 6.2 was, as of the date of this Agreement and is, as of the Closing Date, true and correct in all material respects; 


		
	(d)
	Delivery of Conveyance Documents:  Purchaser shall have delivered to Vendor at least one (1) copy of the documents described in Subclause 3.3(b); 


		
	(e)
	Delivery of Section 116 Escrow Agreement:  Purchaser shall have delivered to Vendor at least one (1) copy of the Section 116 Escrow Agreement referred to in Clause 2.6 hereof, in a form and substance agreed to by the Parties prior to Closing; and





34




		
	(f)
	Rights of First Refusal:  At least two (2) Business Days prior to the Closing Date, all Rights of First Refusal shall have been determined by both Parties to be inapplicable, waived or exercised, or shall have expired by the effluxion of time.


		
	10.4
	Waiver of Conditions


The conditions in Clauses 10.2 and 10.3 are for the sole benefit of Purchaser or Vendor respectively.  Except for the conditions set forth in Subclauses 10.2(f) and 10.3(e), the Party for the benefit of which such conditions have been included may waive any of them, in whole or in part, and such waiver shall be accomplished by written notice to the other Party, and shall be without prejudice to any of the rights of the Party waiving such condition including reliance on or enforcement of the representations, warranties or covenants which are preserved and pertain to conditions similar to the condition so waived.  Neither Purchaser nor Vendor shall be entitled to waive the existence and operation of any Right of First Refusal and the conditions set forth in Subclauses 10.2(f) and 10.3(e).


		
	10.5
	Failure to Satisfy Conditions


If any condition in Clause 10.2 or 10.3 has not been satisfied at or before the Closing Date and such condition has not been waived by the Party for the benefit of which such condition has been included, to the extent it is entitled to do so, such Party may terminate this Agreement by written notice to the other Party.  However, a Party may not terminate this Agreement in such manner after Closing, and after Closing the remedies otherwise available to it with respect to the failure to satisfy such condition, if any, shall be limited to damages.


		
	10.6
	Parties' Diligence


Each Party shall proceed diligently, honestly and in good faith and use all reasonable efforts with respect to all matters within its control to satisfy the conditions referred to in Clauses 10.1, 10.2 and 10.3.



35






ARTICLE 11     
CONFIDENTIALITY
		
	11.1
	Confidentiality


		
	(a)
	Information respecting the Assets shall be retained in confidence and used only for the purposes of the transaction herein contemplated, provided that, upon Closing, Purchaser's rights to use or disclose such information shall be subject only to any operating, unit or other agreements that apply to the transaction herein contemplated.  Any additional information obtained as a result of access to Vendor’s records which does not relate to the Assets shall continue to be treated as confidential and shall not be used by Purchaser without Vendor’s prior written consent.  However, the restrictions on disclosure and use of information in this Agreement shall not apply to information to the extent to which it:


		
	(i)
	is or becomes publicly available through no act or omission of Purchaser or its consultants or advisors;


		
	(ii)
	is lawfully obtained from a third party; or


		
	(iii)
	is already in Purchaser's possession at the time of disclosure, without restriction on disclosure;


provided, however, that specific items of information shall not be considered to be in the public domain merely because more general information respecting the Assets is in the public domain.


		
	(b)
	Neither Party will make any press release or other public announcement respecting this Transaction without the written consent of the other Party, such consent not to be unreasonably withheld. Anything in this paragraph to the contrary notwithstanding, a Party may make any required press release or other public announcement necessary to comply with any Regulations or the rules of any listing authority or stock exchange with which the disclosing Party is bound to comply.


		
	11.2
	Consultants and Advisors Bound


If Purchaser employs consultants, advisors or agents to assist in its review of the Assets pursuant to Article 8, Purchaser shall be responsible to Vendor for ensuring that such consultants, advisors and agents comply with the restrictions on the use and disclosure of information set forth in Clause 11.1.


ARTICLE 12     
LIABILITY AND INDEMNIFICATION
		
	12.1
	Indemnities


(a)    Subject to Clauses 12.2 and 12.4, Vendor shall:


		
	(i)
	be liable to Purchaser and its Representatives for; and





36




		
	(ii)
	indemnify, save and hold harmless Purchaser and its Representatives from and against;


all Losses caused by Vendor’s breach of this Agreement including any breach of a representation or warranty contained herein, except to the extent that any such Loss is reimbursed by Purchaser’s insurance, is caused by the gross negligence or wilful misconduct of Purchaser or Representatives, or to the extent to which Purchaser did not rely on such representation or warranty.


(b)    Subject to Clause 12.4, Purchaser shall:


		
	(i)
	be liable to Vendor and its Representatives for; and




		
	(ii)
	indemnify, save and hold harmless Vendor and its Representatives from and against;


all Losses caused by Purchaser’s breach of this Agreement including any breach of a representation or warranty contained herein, except to the extent that any such Loss is reimbursed by Vendor’s insurance, is caused by the gross negligence or wilful misconduct of Vendor or its Representatives, or to the extent to which Vendor did not rely on such representation or warranty.


		
	12.2
	Purchaser’s General Indemnity


Purchaser agrees that, notwithstanding Clause 12.1, it shall:


		
	(a)
	be liable to Vendor and its Representatives for; and




		
	(b)
	indemnify, save and hold harmless Vendor and its Representatives from and against;




all Losses pertaining to the Assets or operations on or in respect of the Assets that occur or accrue on or after the Effective Date except to the extent that any such Losses are reimbursed by Vendor’s insurance or are caused by the gross negligence or wilful misconduct of Vendor or its Representatives.


		
	12.3
	Environmental Indemnity


Notwithstanding Clause 12.1, Purchaser shall:


		
	(a)
	be liable to Vendor and its Representatives for; and




		
	(b)
	indemnify, save and hold harmless Vendor and its Representatives from and against;




all Losses directly or indirectly resulting from any matter or thing pertaining to any Environmental Liabilities however, whenever and by whomever caused, and Purchaser shall assume, perform, pay and discharge all Environmental Liabilities.  Subject to Clause 12.1(a) and Vendor’s representation and warranty set forth in Subclause 6.1(r), Purchaser hereby releases Vendor from any claims and waives any rights or remedies that Purchaser may now or in the future have against Vendor with respect to Environmental Liabilities, whether such claims, rights and remedies are pursuant to common law, statute or otherwise, including the right to name Vendor as a third party to any action commenced against Purchaser in respect thereof.



37






		
	12.4
	Limitation of Claims


		
	(a)
	In the absence of fraud, no claim in respect of Clause 6.1, Clause 6.2, or this Article 12 shall be made or be enforceable, whether by legal proceedings or otherwise, unless notice describing such claim in reasonable detail is given by the claimant to the applicable Party within twelve (12) months of the Closing Date.




		
	(b)
	Notwithstanding anything contained herein, the total liabilities in this Agreement of Vendor, including any claims relating to its representations and warranties in Clauses 6.1, or 6.2, shall not, under any circumstances exceed a sum equivalent to the Purchase Price.




		
	(c)
	Except as specifically and expressly provided in this Agreement, nothing contained in this Agreement shall impose any liability on a Party for indirect or consequential damages, including, but not limited to, business loss, loss of profits or economic losses which are or may be suffered by a Party or its successors and assigns, or any punitive damages.




		
	(d)
	Except as specifically and expressly provided in this Agreement, nothing contained in this Article 12 shall impose any liability on any Party for the income tax liabilities of another Party.




		
	(e)
	The adjustments to the Purchase Price pursuant to Clause 4.1 and any payments made in respect thereto shall not be considered Losses or liabilities of a Party and shall not be limited by this Clause 12.4.




		
	12.5
	Notice of Claims


If, after the Closing Time, a claim is asserted in circumstances which do or may give rise to an indemnity under this Article 12, the Party against whom the claim is asserted shall forthwith give notice thereof to the Party required to indemnify, and the Parties shall consult and cooperate in respect thereof and in determining whether the claim and any legal proceedings relating thereto should be resisted, compromised or settled.  Each Party shall make available to the other all information in its possession or to which it has access which is or may be relevant to the particular claim.  Purchaser shall provide Vendor with access to the Lands to which the claim relates to the extent reasonably necessary in connection with the claim.  No such claim shall be settled or compromised without the written consent of the Party required to indemnify hereunder, which consent shall not be unreasonably withheld.  If any such claim relates exclusively to a period prior to or after the Closing Time, as the case may be, Vendor or Purchaser respectively shall have exclusive conduct of the claim and all legal proceedings relating thereto.


ARTICLE 13     
TERMINATION
		
	13.1
	Termination


This Agreement may be terminated in the following instances:



38






		
	(a)
	as set forth in Subclause 8.3(c) or 8.7(c);


		
	(b)
	by Vendor if any of the conditions set forth in Clause 10.3 are not satisfied in all material respects or waived on or before the Closing Time by Vendor (where entitled to do so);


		
	(c)
	by Purchaser if any of the conditions set forth in Clause 10.2 are not satisfied in all material respects or waived on or before the Closing Time by Purchaser (where entitled to do so); or


		
	(d)
	at any time by the mutual written agreement of Purchaser and Vendor.


		
	13.2
	Liabilities upon Termination


If Vendor terminates this Agreement in accordance with Subclause 13.1(b), Vendor shall have no liability hereunder of any nature whatsoever to Purchaser.  If Purchaser terminates this Agreement in accordance with Subclause 13.1(c), Purchaser shall have no liability hereunder of any nature whatsoever to Vendor.  


ARTICLE 14    
NOTICE


		
	14.1
	Service of Notices


Notwithstanding anything to the contrary contained herein, all notices required or permitted hereunder shall be in writing and shall be delivered as follows:


		
	(a)
	personally, by delivering the notice to the Party at that Party's address for service during normal business hours on a Business Day in which case the notice shall be deemed to have been given to and received by that Party when delivered.  If a notice is not delivered on such a day or is delivered after the addressee's normal business hours, such notice shall be deemed to have been received by such Party at the commencement of that Party’s next ensuing Business Day following the time of the delivery;


		
	(b)
	by facsimile transmission to a Party to such Party's fax number for notices hereunder, in which case the notice shall be deemed to have been received by that Party when transmitted, provided that if the notice is not transmitted on a Business Day or is transmitted after normal business hours on a Business Day, it will be deemed to have been received on the next ensuing Business Day; or


		
	(c)
	except in the event of an actual or threatened postal strike or other labour disruption that may affect mail service, by registered mail to a Party at the address of such Party set out below, in which case the item so mailed shall be deemed to have been received by that Party on the fifth (5th) Business Day following the date of the mailing thereof.





39




		
	14.2
	Addresses for Notices


The address for service of notices hereunder of each of the Parties shall be as follows:
Vendor:        Barnwell of Canada, Limited
Suite 2410, 500 – 4th Avenue SW
Calgary, Alberta  T2P 2V6
Attention: Land
Fax: (403) 266-4124


Purchaser:    Canadian Natural Resources Limited    
2100, 855 – 2 Street SW
Calgary, Alberta  T2P 4J8
Attention:  Manager, Legal Counsel, Acquisitions and Divestments  
Fax: (403) 517-7369


		
	14.3
	Right to Change Address


A Party may change its address for service by notice to the other Party, and such changed address for service shall thereafter be effective for all purposes of this Agreement.


ARTICLE 15     
MISCELLANEOUS PROVISIONS
		
	15.1
	Further Assurances


At or before Closing, and thereafter as may be necessary and without further consideration, the Parties shall execute, acknowledge and deliver such instruments and take such other actions as may be reasonably necessary to fulfil their respective obligations under this Agreement.  Vendor shall cooperate with Purchaser as reasonably required to secure execution of the Conveyance Documents by third parties.


		
	15.2
	Subordination of Ancillary Documents


Except for the Section 116 Escrow Agreement and any power of attorney, agency or trust documents authorizing and empowering Barnwell of Canada, Limited  as agent and attorney to transfer and convey any Assets or portion thereof, all documents executed by the Parties and delivered pursuant to the provisions of this Agreement are subordinate to the provisions of this Agreement and in the event of conflict between this Agreement and those documents, the provisions hereof shall govern and prevail.


		
	15.3
	Governing Law


In all respects, this Agreement shall be subject to and be interpreted, construed and enforced in accordance with the laws in effect in the Province of Alberta.  Each Party accepts the exclusive jurisdiction of the courts of the Province of Alberta and all courts of appeal therefrom.


		
	15.4
	Time


Time shall be of the essence in this Agreement.





40




		
	15.5
	Public Disclosure


Except as may be required by applicable laws or Regulations of any governmental agency or stock exchange and providing at least two (2) Business Days’ advance written notice to the other Party, neither Purchaser nor Vendor shall, prior to or in connection with Closing, issue any press release or other public disclosure concerning this Agreement or the transaction herein contemplated without the other Party's prior written consent, which consent shall not be unreasonably withheld.


		
	15.6
	Assignments


Neither Party may assign this Agreement or any part hereof without the other Party's prior written consent, which consent may be unreasonably and arbitrarily withheld.


		
	15.7
	Waiver in Writing


No waiver of any breach (whether actual or anticipated) of any of the terms, conditions, representations or warranties contained herein shall take effect or be binding upon the waiving Party unless the waiver is expressed in writing under the authority of that waiving Party.  Any waiver so given shall extend only to the particular breach so waived and shall not limit or affect any rights with respect to any other or future breach.


		
	15.8
	No Merger


The covenants, representations, warranties and indemnities contained in this Agreement shall survive Closing as provided for herein and shall not merge in any assignments, conveyances, transfers or other documents executed and delivered at or after Closing, notwithstanding any rule of law, equity or statute to the contrary and all such rules are hereby waived.


		
	15.9
	Prior Agreements and Amendments


This Agreement supersedes and replaces any and all prior agreements between the Parties relating to the sale and purchase of the Assets and may be amended only by written instrument signed by the Parties.


		
	15.10
	Entire Agreement


This instrument states the entire Agreement between the Parties.


		
	15.11
	Enurement


This Agreement shall be binding upon and shall enure to the benefit of the Parties and their respective trustees, receivers, receiver‐managers, successors and permitted assigns.


		
	15.12
	Substitution and Subrogation


To the extent possible, Vendor shall convey the Assets to Purchaser with full right of substitution and subrogation of Purchaser in and to all covenants, representations and warranties by others heretofore given or made in respect of the Assets or any part thereof.





41




		
	15.13
	Remedies Cumulative


No reference to or exercise of any specific right or remedy hereunder by a Party shall prejudice or preclude such Party from exercising or invoking any other remedy in respect of the matter giving rise to such rights or remedies, whether allowed at law or in equity or expressly provided for herein.  No such remedy shall be exclusive of or dependent upon any other such remedy but each Party may exercise any one or more of such remedies independently or in combination.


		
	15.14
	Counterpart Execution


This Agreement may be executed in separate counterparts and delivered by facsimile and each counterpart when so executed and delivered will be deemed to be an original, all of which when taken together will constitute one and the same instrument.  Production of an originally-executed or facsimile copy of each counterpart execution page will be sufficient to prove the execution and delivery of this Agreement.  Any Party delivering this Agreement by facsimile undertakes to deliver, within a reasonable time, an executed original.




IN WITNESS WHEREOF the Parties have duly executed this Agreement.




CANADIAN NATURAL RESOURCES LIMITED  





Per: /s/ Betty Yee        
     Betty Yee,
Vice President, Land




BARNWELL OF CANADA, LIMITED,
in its personal capacity and in its capacity as agent and attorney








Per: /s/ Lloyd Arnason__________________________
Lloyd Arnason, P. Eng.
           President & Chief Operating Officer














This is the execution page to a Purchase and Sale Agreement made August 10, 2015 between 
Barnwell of Canada, Limited, as Vendor, and Canadian Natural Resources Limited, as Purchaser





42




This is Schedule "A" to an Purchase and Sale Agreement made August 10, 2015
between Barnwell of Canada, Limited, as Vendor, and Canadian Natural Resources Limited, as Purchaser


    
PETROLEUM AND NATURAL GAS RIGHTS


Dunvegan Area, Alberta


	
				
	LEASES
	LANDS
	VENDOR’S
INTEREST
	ENCUMBRANCES

	Ptn. Alberta Crown PNG Lease 
17569-A


(M00842)
	Twp. 80, Rge. 3 W6M:
Secs 1, 2, 11, 12 & 13
PNG Surface to Base Debolt Excluding PNG in Bluesky-Bullhead, NG in Upper, Middle and Lower Debolt 
	11.875% WI
	Alberta Crown Lessor Royalty


3% Non-Convertible GORR payable to CNRL on 100% production paid by  Vendor 11.875%

	Ptn. Alberta Crown PNG Lease 
17569-A


(M00842)
	Non-unitized gas produced from 
100/9-1-80-3 W6/00 well only


	11.875% WI
	Alberta Crown Lessor Royalty


3% Non-Convertible GORR payable to CNRL on 100% production paid by Vendor 11.875%
GORR payable to Dunvegan Gas Unit #1 Participants on 100% production paid by 
Vendor 11.875% 

	Ptn. Alberta Crown PNG Lease 
17569-A


(M00842)
	Twp. 80, Rge. 3 W6M:
Secs 2, 11, 12, 13
PNG in Bluesky-Bullhead


Twp. 80 Rge.3 W6M:
Sec 1
PNG in Bluesky-Bullhead
Excluding non-unitized gas produced from 
100/9-1-80-3 W6/00 well only
	11.875% WI
	Alberta Crown Lessor Royalty


3% Non-Convertible GORR payable to CNRL on 100% production paid by  Vendor 11.875% 

	Ptn. Alberta Crown PNG Lease 
17569-A


(M00842)
	Twp. 80, Rge. 3 W6M:
Secs 1, 2, 11, 12, 13 
(Unitized Zones)
NG in Debolt


	13.53471% WI
	Alberta Crown Lessor Royalty


3% Non-Convertible GORR payable to CNRL on 100% production paid by  Vendor 11.875%

	Ptn. Alberta Crown PNG Lease 
1395-A


(M00846)
	Twp. 80, Rge. 3 W6M:
S & NE 4
Twp. 80 Rge. 4 W6M
Secs 13, 14, 28, 32, 33
NG in Bluesky-Bullhead, Lower Debolt 


Twp. 80, Rge. 3 W6M:
Sec 3
NG in Bluesky-Bullhead 
	14.2500% WI
	Alberta Crown Lessor Royalty



























43




	
				
	LEASES
	LANDS
	VENDOR’S
INTEREST
	ENCUMBRANCES

	Ptn. Alberta Crown PNG Lease 
1395-A


(M00846)
	Twp. 80, Rge. 3 W6M:
S, NE & Ptn NW 4 
NG in Upper Debolt, Middle Debolt
(Unitized Zones)


Twp. 80 Rge. 4 W6M:
Secs 13, 14, 28, 32, 33 
NG in Upper Debolt, Middle Debolt
(Unitized Zones)


Twp. 80, Rge. 3 W6M:
Sec 3 
NG in Upper Debolt, Middle Debolt
(Unitized Zones)
	13.53471% WI
	Alberta Crown Lessor Royalty

	Ptn. Alberta Crown PNG Lease 
1395-A


(M00846)
	Twp. 80, Rge. 3 W6M:
Secs S, NE & Ptn NW 4 
Depth 690-742M only
NG in Bluesky-Bullhead 
	13.968% WI






	Alberta Crown Lessor Royalty


5% Non-Convertible GORR payable to CNRL on 100% production paid by  Vendor 13.968%

	Ptn. Alberta Crown PNG Lease 
1395-A




Ptn. Alberta Crown PNG Lease 
1395-A


(M00846)
	Twp. 80, Rge. 3 W6M:
S, NE & Ptn NW 4 
NG in Bluesky-Bullhead
Excluding Depth 690-742M


Twp. 80, Rge. 3 W6M:
S, NW & Ptn NE 5;
NG in Bluesky-Bullhead, Debolt


	14.2500% WI








	Alberta Crown Lessor Royalty





	Ptn. Freehold 
PNG Lease 
Lessor Eddy, E & K


(M00844)
	Twp. 80 Rge. 3 W6M:
Ptn 4, Ptn 8, Ptn 9
PNG Surface to Basement Excluding NG in Bluesky-Bullhead, Upper Debolt, Middle Debolt


Twp. 80 Rge. 3 W6M:
Ptn 5
PNG Surface to Basement
	11.875% WI




	Freehold Lessor Royalty 17.5%

	Ptn. Freehold 
PNG Lease 
Lessor Eddy, E & K


(M00844)
	Twp. 80 Rge. 3 W6M:
Ptn 4, Ptn SE 8, Ptn SW 9 (Unitized Zones)
NG in Upper Debolt, Middle Debolt 
	13.53471% WI




	Freehold Lessor Royalty 17.5%

	Ptn. Freehold 
PNG Lease 
Lessor Eddy, E & K


(M00844)
	Twp. 80 Rge. 3 W6M:
Ptn NW 4 
(Depth 690-742M)
NG in Bluesky-Bullhead
	13.968% WI




	Freehold Lessor Royalty 17.5%


5% Non-Convertible GORR payable to CNRL on 100% production paid by  Vendor 13.968%

	LEASES
	LANDS
	VENDOR’S
INTEREST
	ENCUMBRANCES







44




	
				
	Ptn. Alberta Crown PNG Lease 
17570


(M00827)
	Twp. 80 Rge. 3 W6M:
N & SE 7
PNG from Surface to Base Debolt
Excluding NG in Upper Debolt, Middle Debolt


Twp. 80 Rge. 3 W6M:
Sec 18
PNG Surface to Base Debolt Excluding NG in Paddy-Cadotte, Upper Debolt, Middle Debolt


Twp. 80 Rge. 3 W6M:
Sec 16
PNG Surface to Base Debolt Excluding NG in Bluesky-Bullhead, NG in Debolt


Twp. 80 Rge. 3 W6M:
Sec 17
PNG from Surface to Base Debolt 
Excluding in Debolt
	11.875% WI




	Alberta Crown Lessor Royalty


3% Non-Convertible GORR payable to CNRL on 100% production paid by  Vendor 11.875%

	Ptn. Alberta Crown PNG Lease 
17570


(M00827)
	Twp. 80 Rge. 3 W6M:
N & SE 7, Sec 18 
NG in Upper Debolt, Middle Debolt
 (Unitized Zones)


Twp. 80 Rge. 3 W6M:
Sec 16 
NG in Bluesky-Bullhead, NG in Debolt
(Unitized Zones)


Twp. 80 Rge. 3 W6M:
Sec 17 
NG in Debolt
(Unitized Zones)
	13.53471% WI




	Alberta Crown Lessor Royalty


3% Non-Convertible GORR payable to CNRL on 100% production paid by  Vendor 11.875%

	Ptn. Alberta Crown PNG Lease 
17570


(M00827)
	Non-unitized gas production between 449.5M to 466M and 466M to 500MKB only
from 100/08-18-80-3W6/02 well
	13.13904% WI BPPO




Barnwell 11.875% WI APPO


	Alberta Crown Lessor Royalty


5% Non-Convertible GORR payable to CNRL on 100% production paid by Vendor 13.13904%
3% Non-Convertible GORR payable to CNRL on 100% production paid by 
Vendor 13.13904%







45






	
				
	LEASES
	LANDS
	VENDOR’S
INTEREST
	ENCUMBRANCES

	Pt. Alberta Crown PNG Lease 
1395


(M00845)
	Twp. 80 Rge. 3 W6M:
SW, N & Ptn SE 8, Ptn SW 9
NG in Bluesky-Bullhead, Lower Debolt


Twp. 80 Rge. 3 W6M:
SE & N 9, Secs 15, 19 & 30
NG in Bluesky-Bullhead


Twp. 80 Rge. 4 W6M:
Sec 35
NG in Lower Debolt


Twp. 80 Rge. 4 W6M:
Sec 24 
NG in Bluesky-Bullhead, Debolt
Excluding non-unitized gas between 444.95M to 466M and 466M to 500MKB only from 100/10-24-80-3W6/02 well


Twp. 80 Rge. 4 W6M: 
Sec 10
NG in Bluesky-Bullhead 
	23.75% WI




	Alberta Crown Lessor Royalty



	Ptn. Alberta Crown PNG Lease 1395


(M00845)
	Twp. 80 Rge. 3 W6M:
SW, N & Ptn SE 8, Ptn SW 9 
(Unitized Zones)
NG in Upper Debolt, Middle Debolt
 
Twp. 80 Rge. 3 W6M:
SE & N 9, Secs 10, 15, 19, 30
(Unitized Zones)
NG in Debolt


Twp. 80 Rge. 4 W6M:
Sec  24
 NG in Debolt 
(Unitized Zones)


Twp. 80 Rge. 3 W6M:
Secs 20, 21, 22, 23 & 31 
 (Unitized Zones)
NG in Bluesky-Bullhead, Debolt


Twp. 80 Rge. 4 W6M:
S & NE 25, Sec 35 
 (Unitized Zones)
NG in Bluesky-Bullhead, Upper Debolt, Middle Debolt
	13.53471% WI




	Alberta Crown Lessor Royalty









46






	
				
	LEASES
	LANDS
	VENDOR’S
INTEREST
	ENCUMBRANCES

	Ptn. Alberta Crown PNG Lease 
17569


(M00826)
	Twp. 80 Rge. 3 W6M:
Sec 14
PNG Surface to Base Debolt Excluding NG in Debolt 
	17.8125% WI
	Alberta Crown Lessor Royalty


3.75% Non-Convertible GORR 
payable on 18.75% production to CNRL 18.374%, Prairie Birch 69.376% and Signalta 12.25% paid by Vendor 95%


3% Non-Convertible GORR payable to CNRL on 100% production paid by  Vendor 17.8125%

	Ptn. Alberta Crown PNG Lease 
17569


(M00826)
	Twp. 80 Rge. 3 W6M:
Sec 14 
(Unitized Zones)
NG in Debolt


	13.53471% WI
	Alberta Crown Lessor Royalty


3.75% Non-Convertible GORR payable on 18.75% production to CNRL 18.374%, Prairie Birch 69.376% and Signalta 12.25% paid by  Vendor 95%
3% Non-Convertible GORR payable to CNRL on 100% production paid by  Vendor 17.8125%

	Ptn. Alberta Crown PNG Lease 
17571-A


(M00843)
	Twp. 80 Rge. 3 W6M:
Sec 27
PNG from Surface to Base Debolt 
Excluding NG in Bluesky-Bullhead, Debolt
	11.875% WI
	Alberta Crown Lessor Royalty


3% Non-Convertible GORR payable to CNRL on 100% production paid by  Vendor 11.875%

	Pt. Alberta Crown PNG Lease 
17571-A


(M00843)
	Twp. 80 Rge. 3 W6M:
Sec 27 
(Unitized Zones)
NG in Bluesky-Bullhead, Debolt


	13.53471% WI
	Alberta Crown Lessor Royalty


3% Non-Convertible GORR payable to CNRL on 100% production paid by  Vendor 11.875%

	Pt. Alberta Crown PNG Lease 
17571


(M00828)


	Twp. 80 Rge. 3 W6M:
Sec  28 
PNG Surface to Base Debolt Excluding NG in Bluesky-Bullhead, PET in Debolt C, NG in Debolt
And Excluding prod. from 100/01-28-80-3 W6M well


Twp. 80 Rge. 3 W6M:
Sec 32
PNG Surface to Base Debolt  Excluding NG in Cadotte, Bluesky-Bullhead, PET in Debolt C, NG in Debolt


Twp. 80 Rge. 3 W6M:
Sec 33
PNG Surface to Base Debolt Excluding NG in Bluesky-Bullhead
	11.875% WI
	Alberta Crown Lessor Royalty


3% Non-Convertible GORR payable to CNRL on 100% production paid by  Vendor 11.875%



























47




	
				
	LEASES
	LANDS
	VENDOR’S
INTEREST
	ENCUMBRANCES

	Pt. Alberta Crown PNG Lease 
17571


(M00828)
	Twp. 80 Rge. 3 W6M
Sec 28 
(Unitized Zones) 
(Debolt 4444’ to 5294’)
NG in Bluesky Bullhead, Debolt


Twp. 80 Rge. 3 W6M
Sec 32 
(Unitized Zones) 
(Debolt 4444’ to 5294’)
NG in Cadotte, Bluesky-Bullhead, Debolt


Twp. 80 Rge. 3 W6M:
Sec 33 
(Unitized Zones) 
(2754’ to 3043’ Bluesky-Bullhead)
NG in Bluesky-Bullhead
	13.53471% WI
	Alberta Crown Lessor Royalty


3% Non-Convertible GORR payable to CNRL on 100% production paid by  Vendor 11.875%

	Pt. Alberta Crown PNG Lease 
17571


(M00828)
	Twp. 80 Rge. 3 W6M:
Secs 28 & 32
PET in Debolt C


	15.6514% WI
	Alberta Crown Lessor Royalty


3% Non-Convertible GORR payable to CNRL on 100% production paid by  Vendor 11.875%

	Pt. AlbertaCrown PNG Lease 
17571


(M00828)


	Twp. 80 Rge. 3 W6M:
Sec 29
PNG surface to Base Debolt Excluding NG in Paddy, Cadotte, Bluesky-Bullhead, Montney, PET  from Top Debolt to Base Debolt C, NG in Debolt


	17.8125% WI
	Alberta Crown Lessor Royalty


3% Non-Convertible GORR payable to CNRL on 100% production paid by  Vendor 17.8125%  
3.75% Non-Convertible GORR payable on 18.75% production to CNRL 25% and Prairie Birch 75% paid by  Vendor 95%

	Pt. Alberta Crown PNG Lease 
17571


(M00828)


	Twp. 80 Rge. 3 W6M:
Sec 29 
(Unitized Zones)
NG in Paddy, Cadotte, Bluesky-Bullhead, Debolt
	13.53471% WI
	Alberta Crown Lessor Royalty


3% Non-Convertible GORR payable to CNRL on 100% production paid by  Vendor 17.8125%


3.75% Non-Convertible GORR payable on 18.75% production to CNRL 12.75%, Prairie Birch 75%
and Signalta 12.25% paid by  Vendor 95%

	Pt. Alberta Crown PNG Lease 
17571


(M00828)
	NG production from Montney from 15-29-80-3 W6 well


	17.8125% WI
	Alberta Crown Lessor Royalty


3% Non-Convertible GORR payable to CNRL on 100% production paid by  Vendor 17.8125%


3.75% Non-Convertible GORR payable on 18.75% production to CNRL 25% and Prairie Birch 75% paid by  Vendor 95%


5% Non-Convertible GORR
Payable to CNRL on 100% production paid by  Vendor 17.8125%







48




	
				
	LEASES
	LANDS
	VENDOR’S
INTEREST
	ENCUMBRANCES

	Pt. Alberta Crown PNG Lease 
17571


(M00828)
	Twp. 80 Rge. 3 W6M:
Sec 29
PET in Debolt Excluding Pet in Debolt C
	15.6514% WI
	Alberta Crown Lessor Royalty


3% Non-Convertible GORR payable to CNRL on 100% production paid by Vendor 15.6514%
3.75% Non-Convertible GORR payable on 18.75% production to CNRL 25% and Prairie Birch 75% paid by  Vendor 95%

	Pt. Alberta Crown PNG Lease 
17571


(M00828)
	Twp. 80 Rge. 3 W6M:
Sec 34
PNG Surface to Base Bluesky-Bullhead Excluding NG in Bluesky-Bullhead
	23.75% WI
	Alberta Crown Lessor Royalty


3% Non-Convertible GORR payable to CNRL on 100% production paid by  Vendor 23.75%
Non-Convertible GORR 15% Gas 1/150 (5-15%) Oil payable on 100% production to CNRL 18.375%, Prairie Birch 69.375%, Signalta 12.25% paid by  Vendor 23.75%

	Pt. Alberta Crown PNG Lease 
17571


(M00828)
	Twp. 80 Rge. 3 W6M:
Sec 34 
(Unitized Zone)
NG in Bluesky-Bullhead


	13.53471% WI
	Alberta Crown Lessor Royalty


3% Non-Convertible GORR payable to CNRL on 100% production paid by  Vendor 23.75% 


Non-Convertible GORR 15% Gas 1/150 (5-15%) Oil payable on 100% production to CNRL 18.375%, Prairie Birch 69.375% and Signalta 12.25% paid by Vendor 23.75%

	Pt. Alberta Crown PNG Lease 
30646


(M00824)
	Twp. 80 Rge. 3 W6M:
N 30
PNG Surface to Base Peace River Excluding NG in Paddy


	23.75% WI
	Alberta Crown Lessor Royalty



	Pt. Alberta Crown PNG Lease 
30646


(M00824)
	Twp. 80 Rge. 3 W6M:
N 30 
NG in Paddy 
(Unitized Zone)


	13.53471% WI
	Alberta Crown Lessor Royalty



	Pt. Alberta Crown PNG Lease 0594100283


(M00858)
	Twp. 80 Rge. 3 W6M:
Sec 31
PNG Base Peace River to Base Triassic 
Excluding NG in Worsley, Bluesky-Bullhead
	13.53471% WI
	Alberta Crown Lessor Royalty



	Pt. Alberta Crown PNG Lease 0594100283


(M00858)
	Twp. 80 Rge. 3 W6M
Sec 31
(100/11-31-080-03W6/04 Wellbore)
NG in Worsley
	13.53471% WI
	Alberta Crown Lessor Royalty


5% Non-Convertible GORR payable to CNRL on 100% production paid by  Vendor 13.53471%































49




	
				
	LEASES
	LANDS
	VENDOR’S
INTEREST
	ENCUMBRANCES

	Pt. Alberta Crown PNG Lease 
7630


(M00825)
	Twp. 80 Rge. 4 W6M:
NW 25
PNG in Bluesky-Bullhead, Debolt 
Excluding NG in Bluesky-Bullhead, Middle Debolt, Lower Debolt
	17.8125% WI
	Alberta Crown Lessor Royalty



	Pt. Alberta Crown PNG Lease 
7630


(M00825)
	Twp. 80 Rge. 4 W6M
NW 25
NG in Bluesky-Bullhead, Middle Debolt, Lower Debolt 
(Unitized Zones)
	13.53471% WI
	Alberta Crown Lessor Royalty



	Pt. Alberta Crown PNG Lease
32628


(M00830)


	Twp. 81 Rge. 3 W6M:
Sec 6
PNG Surface to Base Peace River


Twp. 81 Rge. 4 W6M:
Secs 2, 11 & 12
PNG Surface to Base Peace River 
Excluding NG in Paddy
	20.78125% WI
	Alberta Crown Lessor Royalty


10% Non-Convertible GORR payable to Wyalta Resources Ltd. on 50% production paid by  Vendor 20.78125%

	Pt. Alberta Crown PNG Lease 
32628


(M00830)
	Twp. 81 Rge. 4 W6M:
Secs 2 & 12
(Unitized Zone)
NG in Paddy
	13.53471% WI
	Alberta Crown Lessor Royalty


10% Non-Convertible GORR payable to Wyalta Resources Ltd. on 50% production paid by Vendor  20.78125%

	Pt. Alberta Crown PNG Lease 
32628


(M00830)
	Twp. 81 Rge. 4 W6M:
Sec 11 
(Unitized Zone)
NG in Paddy
	13.53471% WI
	Alberta Crown Lessor Royalty


10% Non-Convertible GORR payable to Wyalta Resources Ltd. on 50% production paid by  Vendor 23.75%

	Pt. Alberta Crown PNG Lease 
1403-A


(M00852)
	Twp. 81 Rge. 3 W6M:
Sec 6
Twp. 81 Rge. 4 W6M: 
Secs 11 & 12 
NG in Bluesky-Bullhead, Upper Debolt, Middle Debolt (Unitized Zones)
	13.53471% WI
	Alberta Crown Lessor Royalty


10% Non-Convertible GORR payable to Wyalta Resources Ltd. on 50% production paid by   Vendor 20.78125%

	Pt. Alberta Crown PNG Lease 
1403-A


(M00852)
	Twp. 81 Rge. 3 W6M:
Sec 6
PET in Debolt


	13.53471% WI
	Alberta Crown Lessor Royalty



	Pt. Alberta Crown PNG Lease 
1403-A


(M00852)
	Twp. 81 Rge. 3 W6M:
Sec 6
Twp. 81 Rge. 4 W6M: 
Sec 12
NG in Lower Debolt
	20.78125% WI
	Alberta Crown Lessor Royalty


10% Non-Convertible GORR payable to Wyalta Resources Ltd. on 50% production paid by  Vendor 20.78125%

	Pt. Alberta Crown PNG Lease 
1403-A


(M00852)
	Twp. 81 Rge. 4 W6M:
Sec 11
NG in Lower Debolt


	20.78125% WI
	Alberta Crown Lessor Royalty
-10% Non-Convertible GORR payable to Wyalta Resources Ltd. on 50% production paid by  Vendor 23.75%







50




	
				
	LEASES
	LANDS
	VENDOR’S
INTEREST
	ENCUMBRANCES

	Alberta Crown 
PNG Lease 0512050128


(M01406)
	Twp. 81 Rge. 3 W6M:
Sec 18
All PNG Surface to Basement


	100% WI
	Alberta Crown Lessor Royalty



	Alberta Crown 
PNG Lease
 32630


(M00831)
	Twp. 81 Rge. 4 W6M:
Sec 1
PNG Surface to Base Triassic Excluding NG in Peace River, Bluesky-Bullhead
	20.78125% WI
	Alberta Crown Lessor Royalty


10% Non-Convertible GORR payable to Wyalta Resources Ltd. on 50% production paid by  Vendor 20.78125% 

	Ptn. Alberta Crown PNG Lease 
1404-A


(M00854)
	Twp. 81 Rge. 4 W6M:
Sec 1
(Unitized Zones)
NG in Bluesky-Bullhead, Debolt, Paddy
	13.53471% WI
	Alberta Crown Lessor Royalty


10% Non-Convertible GORR payable to Wyalta Resources Ltd. on 50% production paid by  Vendor 23.75%

	Ptn. Alberta Crown PNG Lease 
1404-A


(M00854)
	Twp. 81 Rge. 4 W6M:
Sec 1
NG in Peace River Excluding NG in Paddy


	20.78125% WI
	Alberta Crown Lessor Royalty


10% Non-Convertible GORR payable to Wyalta Resources Ltd. on 50% production paid by  Vendor 23.75%

	Ptn. Alberta Crown PNG Lease 
1404-A


(M00854)
	Twp. 81 Rge. 4 W6M:
Sec 1
PET in Debolt




	13.53471% WI
	Alberta Crown Lessor Royalty

	Ptn. Alberta Crown PNG Lease 
1404-A


(M00854)
	Twp. 81 Rge. 4 W6M:
Sec 23
NG in Peace River 
Excluding NG in Paddy


Twp. 81 Rge. 4 W6M:
Sec 13
NG in Peace River


Twp. 81 Rge. 4 W6M:
Sec 14
NG in Peace River, Debolt Excluding NG in Paddy, Upper Debolt, Middle Debolt
	20.78125% WI
	Alberta Crown Lessor Royalty


10% Non-Convertible GORR payable to Wyalta Resources Ltd. on 50% production paid by  Vendor 20.78125%

	Ptn. Alberta Crown PNG Lease 
1404-A


(M00854)
	Twp. 81 Rge. 4 W6M:
Sec 13
(Unitized Zone)
NG in Bluesky-Bullhead


Twp. 81 Rge. 4 W6M:
Sec 14 
(Unitized Zone)
NG in Paddy, Bluesky-Bullhead, Upper Debolt, Middle Debolt


Twp. 81 Rge. 4 W6M:
Sec 23 
(Unitized Zone)    NG in Paddy
	13.53471% WI
	Alberta Crown Lessor Royalty


10% Non-Convertible GORR payable to Wyalta Resources Ltd. on 50% production paid by  Vendor 20.78125%







51




	
				
	LEASES
	LANDS
	VENDOR’S
INTEREST
	ENCUMBRANCES

	Ptn. Alberta Crown PNG Lease 
1403-C


(M00853)
	Twp. 81 Rge. 4 W6M:
Sec 2 
(Unitized Zones)
NG in Bluesky-Bullhead, Upper Debolt, Middle Debolt
	13.53471% WI
	Alberta Crown Lessor Royalty


10% Non-Convertible GORR payable to Wyalta Resources Ltd. on 50% production paid by  Vendor 20.78125%

	Ptn. Alberta Crown PNG Lease 
1403-C


(M00853)
	Twp. 81 Rge. 4 W6M:
Sec 2
NG in Lower Debolt
	20.78125% WI
	Alberta Crown Lessor Royalty


10% Non-Convertible GORR payable to Wyalta Resources Ltd. on 50% production paid by  Vendor 20.78125%

	Ptn. Alberta Crown PNG Lease 
1356


(M00847)
	Twp. 81 Rge. 4 W6M:
S 7, Secs 21 & 28
 
NG in Debolt 
Excluding NG in Middle Debolt


Twp. 81 Rge. 5 W6M: 
W 13, Secs 14, 23 & 25
NG in Debolt 
Excluding NG in Middle Debolt
	19.000% WI
	Alberta Crown Lessor Royalty



	Ptn. Alberta Crown PNG Lease 
1356


(M00847)
	Twp. 81 Rge. 4 W6M:
S 7, Sec 21 &28 
(Unitized Zones)
NG in Middle Debolt


Twp. 81 Rge. 5 W6M:
S & NE 8, W 13, Secs 14 & 23, W 24, Sec 25 
(Unitized Zones)
NG in Bluesky-Bullhead, Middle Debolt
	13.53471% WI
	Alberta Crown Lessor Royalty



	Ptn. Alberta Crown PNG Lease 
1356


(M00847)
	Twp. 81 Rge. 5 W6M:
S & NE 8 
(Unitized Zones)
NG in Bluesky-Bullhead, Middle Debolt
	13.53471% WI
	Alberta Crown Lessor Royalty



	Ptn. Alberta Crown PNG Lease 
1356


(M00847)
	Twp. 81 Rge. 4 W6M:
S & NE 8
NG in Debolt Excluding NG in Middle Debolt
	14.2500% WI
	Alberta Crown Lessor Royalty

	Ptn. Alberta Crown PNG Lease 
1356


(M00847)
	Twp. 81 Rge. 5 W6M:
W 24
NG in Debolt 
Excluding NG in Middle Debolt


	9.5000% WI
	Alberta Crown Lessor Royalty

	Ptn. Alberta Crown PNG Lease 
29152
	Twp. 81 Rge. 4 W6M:
NW 8 
(Unitized Zones)
 NG in Bluesky-Bullhead, Middle Debolt


	13.53471% WI
	Alberta Crown Lessor Royalty









52




	
				
	LEASES
	LANDS
	VENDOR’S
INTEREST
	ENCUMBRANCES

	Ptn. Alberta Crown PNG Lease
 29152


(M00829)
	Twp. 81 Rge. 5 W6M:
E 24 
(Unitized Zones) 
NG in Bluesky-Bullhead, Middle Debolt


Twp. 81 Rge. 5 W6M:
W 17, W 20 
(Unitized Zone)
NG in Middle Debolt
	13.53471% WI
	Alberta Crown Lessor Royalty



	Ptn. Alberta Crown PNG Lease 
29152


(M00829)
	Twp. 81 Rge. 4 W6M:
NW 8
NG in Debolt 
Excluding NG in Middle Debolt


	14.2500% WI
	Alberta Crown Lessor Royalty



	Ptn. Alberta Crown PNG Lease 
29152


(M00829)
	Twp. 81 Rge. 4 W6M:
W 17
NG in Debolt 
Excluding NG in Middle Debolt


	9.5000% WI
	Alberta Crown Lessor Royalty



	Ptn. Alberta Crown PNG Lease 
29152


(M00829)
	Twp. 81 Rge. 4 W6M:
W 20
Twp. 81 Rge. 5 W6M:
E 24
NG in Debolt 
Excluding NG in Middle Debolt
	9.5000% WI
	Alberta Crown Lessor Royalty

	Alberta Crown 
PNG Lease 0512010211


(M01393)
	Twp. 81 Rge. 4 W6M:
Sec 9
PNG Base Triassic to Basement 
Excluding NG in Debolt


	100% WI
	Alberta Crown Lessor Royalty



	Alberta Crown 
PNG Lease 5494030099


(M00856)
	Twp. 81 Rge. 4 W6M:
Sec 12
PNG Base Peace River to Base of Triassic 
Excluding NG in Bluesky-Bullhead
	13.53471% WI
	Alberta Crown Lessor Royalty



	Alberta Crown 
PNG Lease 0512050129


(M01407)
	Twp. 81 Rge. 4 W6M:
Sec 13
PNG Surface to Basement Excluding NG in Peace River, Bluesky-Bullhead
	100% WI
	Alberta Crown Lessor Royalty



	Alberta Crown 
PNG Lease 0512010212


(M01394)
	Twp. 81 Rge. 4 W6M:
Sec 14
PNG Surface to Basement Excluding NG in Peace River, Bluesky-Bullhead, Debolt
	100% WI
	Alberta Crown Lessor Royalty











53




	
				
	LEASES
	LANDS
	VENDOR’S
INTEREST
	ENCUMBRANCES

	Ptn. Alberta Crown NG Lease 
1357


(M00848)
	Twp. 81 Rge. 4 W6M:
W 16
NG in Peace River, Bluesky-Bullhead, Debolt 
Excluding NG in Middle Debolt


Twp. 81 Rge. 5 W6M
NW 12
NG in Peace River, Debolt, Excluding NG in Middle Debolt
	19.000% WI
	Alberta Crown Lessor Royalty



	Ptn. Alberta Crown NG Lease 
1357


(M00848)
	Twp. 81 Rge. 4 W6M:
W 16 
(Unitized Zone)
NG in Middle Debolt


Twp. 81 Rge. 5 W6M:
NW 12
(Unitized Zones)
NG in Bluesky-Bullhead, Middle Debolt
	13.53471% WI
	Alberta Crown Lessor Royalty



	Ptn. Alberta Crown PNG Lease 0512010213


(M01395)


	Twp. 81 Rge. 4 W6M:
W 16
PNG Surface to Basement 
Excluding NG in Peace River, Bluesky-Bullhead, Debolt


Twp. 81 Rge. 4 W6M:
E 16 
PNG from Base Debolt to Basement
	100% WI
	Alberta Crown Lessor Royalty

	Ptn. Alberta Crown NG Lease 
1358


(M00849)
	Twp. 81 Rge. 4 W6M:
E 17 
NG in Paddy, Middle Debolt
(Unitized Zones)
	13.53471%
	Alberta Crown Lessor Royalty



	Ptn. Alberta Crown NG Lease 
1358


(M00849)
	Twp. 81 Rge. 4 W6M:
E 17
NG in Peace River, Debolt Excluding NG in Paddy, Middle Debolt 
	9.5000% WI
	Alberta Crown Lessor Royalty



	Ptn. Alberta Crown NG Lease 
1362


(M00851)
	Twp. 81 Rge. 4 W6M:
W 17
NG in Peace River, Excluding NG in Paddy


	9.5000% WI
	Alberta Crown Lessor Royalty



	Ptn. Alberta Crown NG Lease 
1362


(M00851)
	Twp. 81 Rge. 4 W6M:
W 17 
(Unitized Zone)
NG in Paddy


	13.53471% WI
	Alberta Crown Lessor Royalty











54




	
				
	LEASES
	LANDS
	VENDOR’S
INTEREST
	ENCUMBRANCES

	Ptn. Alberta Crown NG Lease 1359
(M00850)


	Twp. 81 Rge. 4 W6M:
E 20
NG in Debolt 
Excluding Middle Debolt
	9.5000% WI
	Alberta Crown Lessor Royalty



	Ptn. Alberta Crown NG Lease 
1359


(M00850)
	Twp. 81 Rge. 4 W6M:
E 20 
NG in Middle Debolt
(Unitized Zone)


	13.53471% WI
	Alberta Crown Lessor Royalty



	Ptn. Alberta Crown NG Lease 
1359


(M00850)
	Twp. 81 Rge. 4 W6M: 
Secs 29, 30, 31, 32
NG in Debolt
Excluding NG in Middle Debolt
	19.000% WI
	Alberta Crown Lessor Royalty



	Ptn. Alberta Crown NG Lease 1359


(M00850)
	Twp. 81 Rge. 4 W6M:
Secs  29, 30, 31, 32 
(Unitized Zone)
NG in Middle Debolt
	13.53471% WI
	Alberta Crown Lessor Royalty



	Alberta Crown 
PNG Lease 0511060763


(M01379)
	Twp. 81 Rge. 4 W6M:
E 20
PNG Base Triassic to Basement 
Excluding NG in Debolt


Twp. 81 Rge. 4 W6M:
W 20
PNG Base Debolt to Basement
	100% WI
	Alberta Crown Lessor Royalty

	Alberta Crown 
PNG Lease 0512010214


(M01396)
	Twp. 81 Rge. 4 W6M:
S & NW 21
PNG Base Stoddart to Basement 
Excluding NG in Debolt


Twp. 81 Rge. 4 W6M:
NE 21
PNG Base Debolt to Basement
	100% WI
	Alberta Crown Lessor Royalty

	Alberta Crown 
PNG Lease 0504090611


(M00258)
	Twp. 81 Rge. 4 W6M:
Sec 23
PNG Surface to Base Debolt Excluding NG in Peace River


	13.53471% WI
	Alberta Crown Lessor Royalty



	Alberta Crown 
PNG Lease 0511060764


(M01381)
	Twp. 81 Rge. 4 W6M:
Sec 28
PNG Surface to Base Basement 
Excluding NG in Peace River, Bluesky-Bullhead, Debolt
	100% WI
	Alberta Crown Lessor Royalty

	Alberta Crown 
PNG Lease 
36114


(M0835)
	Twp. 81 Rge. 4 W6M:
Sec 29
PNG Surface to Base Stoddart 
Excluding NG in Peace River


	18.445457% WI
	Alberta Crown Lessor Royalty



















55




	
				
	LEASES
	LANDS
	VENDOR’S
INTEREST
	ENCUMBRANCES

	Alberta Crown 
PNG Lease 0511060765


(M01380)
	Twp. 81 Rge. 4 W6M:
Sec 29
PNG Base Stoddart to Basement  
Excluding NG in Debolt


	100% WI
	Alberta Crown Lessor Royalty






Belloy Area, AB
	
					
	LEASES
	LANDS
	VENDOR’S
INTEREST
	ENCUMBRANCES
	 

	Alberta Crown PNG Lease 
29621


(M00838)
	Twp. 78, Rge. 2 W6M:
S1⁄2  25
PNG Surface to Base Spirit River


	8.60938% WI
	Alberta Crown Lessor Royalty


Non-Convertible GORR 2.8125% gas and 1.875% oil on 48.359357% production paid to Hanna Oil & Gas Company Canada ULC by Vendor 23.75%
	 

	Alberta Crown PNG Lease 
16140


(M00837)
	Twp. 78, Rge. 2 W6M:
N1⁄2  25
PNG Surface to Base Spirit River


	8.60938% WI
	Alberta Crown Lessor Royalty


Non-Convertible GORR 2.8125% gas and 1.875% oil on 48.359375% production paid to Hanna Oil & Gas Company Canada ULC by Vendor 23.75%
	 

	Ptn. Alberta Crown PNG Lease 
40643


(M00841)
	Production from 
102/06-35-78-2 W6M well


	8.75% WI
BPPO


8.60938 % WI APPO
	Alberta Crown Lessor Royalty


Non-Convertible GORR 2.8125% gas and 1.875% oil on 48.359375% production paid to Hanna Oil & Gas Company Canada ULC by Vendor 23.75%
	 

	Ptn. Alberta Crown PNG Lease 
40643


(M00841)
	Twp. 78, Rge 2 W6M:
Sec 35
PNG Surface to Base Bluesky-Bullhead
Excluding production from 102/06-35-78-2 W6M well
	8.60938% WI


	Alberta Crown Lessor Royalty


Non-Convertible GORR 2.8125% gas and 1.875% oil on 48.359375% production paid to Hanna Oil & Gas Company Canada ULC by Vendor 23.75%
	 

	Alberta Crown PNG Lease 
0577020086


(M00836)
	Twp. 78, Rge. 2 W6M:
Sec 36
PNG Surface to Base Spirit River


	8.60938% WI
	Alberta Crown Lessor Royalty




	 

	Ptn. Alberta Crown PNG Lease 
17423


(M00822)
	Twp. 79, Rge. 2 W6M:
Sec 2
PNG Surface to Base Bluesky-Bullhead 
Excluding PNG in Spirit River Formation,  PNG in Bluesky
	300% penalty
BPPO


8.60938 % WI APPO
	Alberta Crown Lessor Royalty


Non-Convertible GORR 2.8125% gas and 1.875% oil on 48.359375% production paid to Hanna Oil & Gas Company Canada ULC by Vendor 23.75% APPO
	 

	Ptn. Alberta Crown PNG Lease 
17423


(M00822)
	Twp. 79, Rge. 2 W6M:
Sec 2
PNG 
in Spirit River Formation,  PNG in Bluesky


	8.60938% WI


	Alberta Crown Lessor Royalty


Non-Convertible GORR 2.8125% gas and 1.875% oil on 48.359375% production paid to Hanna Oil & Gas Company Canada ULC by Vendor 23.75%
	 







56




	
					
	LEASES
	LANDS
	VENDOR’S
INTEREST
	ENCUMBRANCES

	Ptn. Alberta Crown PNG Lease 
17836


(M00823)
	Twp. 79, Rge. 2 W6M:
Sec 3
PNG Surface to Base Spirit River
	8.60938% WI


	Alberta Crown Lessor Royalty


Non-Convertible GORR 2.8125% gas and 1.875% oil on 48.359375% production paid to Hanna Oil & Gas Company Canada ULC by Vendor23.75%
	 

	Ptn. Alberta Crown PNG Lease 
17836


(M00823)
	Twp. 79, Rge. 2 W6M:
Sec 4
PNG Surface to Base Spirit River
	19.59375% WI


	Alberta Crown Lessor Royalty


Non-Convertible GORR 15% gas and 10% oil on 50% production paid to Hanna Oil & Gas Company Canada ULC by Vendor 23.75%
	 

	Ptn. Alberta Crown PNG Lease 
17836


(M00823)
	Twp. 79, Rge. 2 W6M:
Sec 9
PNG Surface to Base Spirit River
	21.375 WI


	Alberta Crown Lessor Royalty


Non-Convertible GORR 15% gas and 10% oil on 50% production paid to Hanna Oil & Gas Company Canada ULC by Vendor 23.75%


Non-convertible GORR15% gas and 1/150 (5-15%) oil on 15% of production paid to Canadian Natural Resources Limited paid by Vendor 23.75%
	 

	Ptn. Alberta Crown PNG Lease 
17836


(M00823)
	Twp. 79, Rge. 2 W6M:
Sec 10
PNG Surface to Base Spirit River
	19.59375% WI


	Alberta Crown Lessor Royalty


Non-Convertible GORR 15% gas and 10% oil on 50% production paid to Hanna Oil & Gas Company Canada ULC by Vendor 23.75%
	 







57






This is Schedule "B" to an Purchase and Sale Agreement made August 10, 2015
between Barnwell of Canada, Limited, as Vendor, and Canadian Natural Resources Limited, as Purchaser




RIGHTS OF FIRST REFUSAL


	
				
	RIGHT OF FIRST REFUSAL ASSETS   
(File)
	ASSOCIATED 
AGREEMENT
	RESPONSE PERIOD
	VENDOR 
INTEREST

	80-04W6M: 
NW 25  
PNG IN BLUESKY-BULLHEAD AND PNG IN DEBOLT 
EXCLUDING NG IN BLUESKY-BULLHEAD, NG IN UPPER DEBOLT, NG IN MIDDLE DEBOLT, NG IN LOWER DEBOLT 
(C00644)
	POOLING AGREEMENT DATED MAY 26, 1972
1971 CAPL clause 2601 B
Ptn. Alberta Crown Lease #7630


	

15 Days
	17.8125% Pooled WI
Subject to: 
-Alberta Crown Lessor Royalty

	80-04W6M: 
NW 25  
NG IN BLUESKY-BULLHEAD, NG IN MIDDLE DEBOLT, NG IN LOWER DEBOLT, NG IN UPPER DEBOLT 
(C00644)
	POOLING AGREEMENT DATED MAY 26, 1972
1971 CAPL clause 2601 B
Ptn. Alberta Crown Lease #7630


	

15 Days
	17.8125% Pooled WI* 
*Includes unitized interests described in 1. below
Subject to:
-Alberta Crown Lessor Royalty

	80-04W6M:  
S&NE 25  
NG IN DEBOLT 
EXCLUDING NG IN  UPPER DEBOLT, MIDDLE DEBOLT, LOWER DEBOLT 
(C00644)
	POOLING AGREEMENT DATED MAY 26, 1972 
1971 CAPL clause 2601 B 
Ptn. Alberta Crown NG Lease #1395
	

15 Days
	17.8125% Pooled WI
Subject to:
-Alberta Crown Lessor Royalty

	80-04W6M: 
S&NE 25  
NG IN BLUESKY-BULLHEAD, NG IN UPPER DEBOLT, NG IN MIDDLE DEBOLT, NG IN LOWER DEBOLT
 (C00644)
	POOLING AGREEMENT DATED MAY 26, 1972 
 1971 CAPL clause 2601 B
Ptn. Alberta Crown NG Lease #1395
	

15 Days
	17.8125% Pooled WI* 
*Includes unitized interests
described in 1. below
Subject to:
-Alberta Crown Lessor Royalty




		
	1.
	NG in Bluesky-Bullhead, NG in Upper Debolt, NG in Middle Debolt, NG in Lower Debolt unitized under Dunvegan Gas Unit No. 1


Tract 4(a) – Tract Factor = 1.64152 



58






	
				
	RIGHT OF FIRST REFUSAL ASSETS   
(File)
	ASSOCIATED 
AGREEMENT
	RESPONSE PERIOD
	VENDOR 
INTEREST

	81-03 W6M: 
Sec 6  
NG IN DEBOLT 
EXCLUDING NG IN UPPER DEBOLT, NG IN MIDDLE DEBOLT  
 (C00658)
	MEMORANDUM OF AGREEMENT DATED DECEMBER 2, 1970
Non CAPL  clause 24
Ptn. Alberta Crown PNG Lease 1403A
	

30 Days
	20.78125% WI
Subject to:
-Alberta Crown Lessor Royalty
-10% non-convertible GORR to Wyalta Resources Ltd. on 50% of production paid by Barnwell 23.75%

	81-03 W6M:  
Sec 6 
NG IN BLUESKY-BULLHEAD 
NG IN UPPER DEBOLT, NG IN MIDDLE DEBOLT  
(C00658)
	MEMORANDUM OF AGREEMENT DATED DECEMBER 2, 1970
Non CAPL clause 24
Ptn. PNG Alberta Crown Lease 1403A
	

30 Days
	20.78125% WI* 
*Includes unitized interests 
described in 2. below
Subject to:
-Alberta Crown Lessor Royalty
-10% non-convertible GORR to Wyalta Resources Ltd. on 50% of production paid by Barnwell 23.75%

	81-03 W6M: 
Sec 6
PNG SURFACE TO BASE PEACE RIVER
(C0658)  
	MEMORANDUM OF AGREEMENT DATED DECEMBER 2, 1970
Non CAPL clause 24
Ptn. Alberta Crown PNG Lease 32628
	

30 Days
	20.78125% WI
Subject to:
-Alberta Crown Lessor Royalty
-10% non-convertible GORR to Wyalta Resources Ltd. on 50% of production paid by Barnwell 23.75%

	81-04 W6M: 
Sec 2
NG IN DEBOLT EXCL NG IN UPPER DEBOLT, NG IN MIDDLE DEBOLT  
(C0658)
	MEMORANDUM OF AGREEMENT DATED DECEMBER 2, 1970
Non CAPL clause 24
Ptn. Alberta Crown PNG Lease 1403C


	

30 Days
	20.78125% WI
Subject to:
-Alberta Crown Lessor Royalty
-10% non-convertible GORR to Wyalta Resources Ltd. on 50% of production paid by Barnwell 23.75%

	81-04 W6M: 
Sec 2 
NG IN BLUESKY-BULLHEAD 
NG IN UPPER DEBOLT, NG IN MIDDLE DEBOLT 
(C00658)
	MEMORANDUM OF AGREEMENT DATED DECEMBER 2, 1970
Non CAPL clause 24
Ptn. Alberta Crown PNG Lease 1403C


	

30 Days
	20.78125% WI* 
*Includes unitized interests 
described in 2. below
Subject to:
-Alberta Crown Lessor Royalty
-10% non-convertible GORR to Wyalta Resources Ltd. on 50% of production paid by Barnwell 23.75%

	81-04 W6M: 
Sec 2 
NG IN PADDY
(C00658)
	MEMORANDUM OF AGREEMENT DATED DECEMBER 2, 1970
Non CAPL clause 24
Ptn. Alberta Crown PNG Lease 32628


	

30 Days
	20.78125% WI* 
*Includes unitized interesst 
described in 2. below
Subject to: 
-Alberta Crown Lessor Royalty
-10% non-convertible GORR to Wyalta Resources Ltd. on 50% of production paid by Barnwell 20.78125%

	81-04 W6M:
Secs 2 & 12
PNG SURFACE TO BASE PEACE RIVER 
EXCLUDING NG IN PADDY
(C00658)
	MEMORANDUM OF AGREEMENT DATED DECEMBER 2, 1970
Non CAPL clause 24
Ptn. Alberta Crown PNG Lease 32628
	

30 Days
	20.78125% WI 
Subject to: 
-Alberta Crown Lessor Royalty
-10% non-convertible GORR to Wyalta Resources Ltd. on 50% of production paid by Barnwell 23.75%







59






	
				
	RIGHT OF FIRST REFUSAL ASSETS   
(File)
	ASSOCIATED 
AGREEMENT
	RESPONSE PERIOD
	VENDOR 
INTEREST

	81-04 W6M: 
Sec 12
NG IN DEBOLT 
EXCLUDING NG IN UPPER DEBOLT, NG IN MIDDLE DEBOLT  
	MEMORANDUM OF AGREEMENT DATED DECEMBER 2, 1970
Non CAPL clause 24
Ptn. Alberta Crown PNG Lease 1403A
	

30 Days
	20.78125 WI%
Subject to:
-Alberta Crown Lessor Royalty
-10% non-convertible GORR to Wyalta Resources Ltd. on 50% of production paid by Barnwell 23.75%

	81-04 W6M: 
Sec 12 
NG IN BLUESKY-BULLHEAD 
NG IN UPPER DEBOLT, NG IN MIDDLE DEBOLT  (C00658)
	MEMORANDUM OF AGREEMENT DATED DECEMBER 2, 1970
Non CAPL clause 24
Ptn. Alberta Crown PNG Lease 1403A
	

30 Days
	20.78125% WI* 
*Includes unitized interests 
described in 2. below
Subject to: 
-Alberta Crown Lessor Royalty
-10% non-convertible GORR to Wyalta Resources Ltd. on 50% of production paid by Barnwell 23.75%

	81-04 W6M: 
Sec 12 
NG IN PADDY
(C00658)
	MEMORANDUM OF AGREEMENT DATED DECEMBER 2, 1970
Non CAPL clause 24
Ptn. Alberta Crown PNG Lease 32628
	

30 Days
	20.78125% WI* 
*Includes unitized interests 
described in 2. below
Subject to: 
-Alberta Crown Lessor Royalty
-10% non-convertible GORR to Wyalta Resources Ltd. on 50% of production paid by Barnwell 23.75%

	81-04 W6M: 
Sec 13 
NG IN PEACE RIVER
(C00658)
	MEMORANDUM OF AGREEMENT DATED DECEMBER 2, 1970
Non CAPL clause 24
Ptn. Alberta Crown PNG Lease 1404A
	

30 Days
	20.78125% WI
Subject to:
 Alberta Crown Lessor Royalty
-10% non-convertible GORR to Wyalta Resources Ltd. on 50% of production paid by Barnwell 23.75%

	81-04 W6M: 
Sec 13 
NG IN BLUESKY-BULLHEAD  (C00658)
	MEMORANDUM OF AGREEMENT DATED DECEMBER 2, 1970
Non CAPL clause 24
Ptn. Alberta Crown PNG Lease 1404A
	

30 Days
	20.78125% WI* 
*Includes unitized interests 
described in 2. below
Subject to:
-Alberta Crown Lessor Royalty
-10% non-convertible GORR to Wyalta Resources Ltd. on 50% of production paid by Barnwell 23.75%

	81-04 W6M: 
Sec 14
NG IN PEACE RIVER AND NG IN DEBOLT 
EXCLUDING NG IN UPPER DEBOLT, NG IN MIDDLE DEBOLT, NG IN PADDY
	MEMORANDUM OF AGREEMENT DATED DECEMBER 2, 1970
Non CAPL clause 24
Ptn. Alberta Crown PNG Lease 1404A


	

30 Days
	20.78125% WI
Subject to: 
-Alberta Crown Lessor Royalty
-10% non-convertible GORR to Wyalta Resources Ltd. on 50% of production paid by Barnwell 23.75%

	81-04 W6M: 
Sec 14 
NG IN PADDY BLUESKY-BULLHEAD, NG IN UPPER DEBOLT, NG IN MIDDLE DEBOLT  
(C00658)
	MEMORANDUM OF AGREEMENT DATED DECEMBER 2, 1970
Non CAPL clause 24
Ptn. Alberta Crown PNG Lease 1404A


	

30 Days
	20.78125% WI* 
*Includes unitized interests 
described in 2. below
Subject to: 
-Alberta Crown Lessor Royalty
-10% non-convertible GORR to Wyalta Resources Ltd. on 50% of production paid by Barnwell 23.75%







60






	
				
	RIGHT OF FIRST REFUSAL ASSETS   
(File)
	ASSOCIATED 
AGREEMENT
	RESPONSE PERIOD
	VENDOR 
INTEREST

	81-04 W6M: 
Sec 23 
NG IN PEACE RIVER
EXCLUDING NG IN PADDY
(C00658)
	MEMORANDUM OF AGREEMENT DATED DECEMBER 2, 1970
Non CAPL clause 24
Ptn. Alberta Crown PNG Lease 1404A
	

30 Days
	20.78125% WI
Subject to: 
-Alberta Crown Lessor Royalty
-10% non-convertible GORR to Wyalta Resources Ltd. on 50% of production paid by Barnwell 23.75%

	81-04 W6M: 
Sec 23 
NG IN PADDY
(C00658)
	MEMORANDUM OF AGREEMENT DATED DECEMBER 2, 1970
Non CAPL clause 24
Ptn. Alberta Crown PNG Lease 1404A


	

30 Days
	20.78125% WI* 
*Includes unitized interests 
described in 2. below
Subject to:
-Alberta Crown Lessor Royalty
-10% non-convertible GORR to Wyalta Resources Ltd. on 50% of production paid by Barnwell 23.75%

	81-04 W6M: 
Sec 1 
PNG SURFACE TO BASE TRIASSIC 
EXCLUDING NG IN PEACE RIVER AND BLUESKY-BULLHEAD  
(C00658)
	MEMORANDUM OF AGREEMENT DATED DECEMBER 2, 1970
Non CAPL clause 24
Alberta Crown PNG lease 32630
	

30 Days
	20.78125% WI
Subject to:
-Alberta Crown Lessor Royalty
-10% non-convertible GORR to Wyalta Resources Ltd. on 50% of production paid by Barnwell 23.75%

	81-04 W6M: 
Sec 1 
NG IN PEACE RIVER EXCLUDING NG IN PADDY
(C00658)
	MEMORANDUM OF AGREEMENT DATED DECEMBER 2, 1970
Non CAPL clause 24
Ptn. Alberta Crown PNG lease 1404A
	

30 Days
	20.78125 % WI
Subject to:
-Alberta Crown Lessor Royalty
-10% non-convertible GORR to Wyalta Resources Ltd. on 50% of production paid by Barnwell 23.75%

	81-04 W6M: 
Sec 1 
NG IN BLUESKY-BULLHEAD 
NG IN UPPER DEBOLT, MIDDLE DEBOLT, LOWER DEBOLT
(C00658)
	MEMORANDUM OF AGREEMENT DATED DECEMBER 2, 1970
Non CAPL clause 24
Ptn. Alberta Crown PNG lease 1403A
	

30 Days
	20.78125% WI* 
*Includes unitized interests 
described in 3. below
Subject to:
-Alberta Crown Lessor Royalty
-10% non-convertible GORR to Wyalta Resources Ltd. on 50% of production paid by Barnwell 23.75%

	81-04 W6M: 
Sec 1 
NG IN PADDY
(C00658)
	MEMORANDUM OF AGREEMENT DATED DECEMBER 2, 1970
Non CAPL clause 24
Ptn. Alberta Crown PNG lease 1404A
	

30 Days
	20.78125% WI* 
*Includes unitized interests 
described in 3. below
Subject to:
-Alberta Crown Lessor Royalty
-10% non-convertible GORR to Wyalta Resources Ltd. on 50% of production paid by Barnwell 23.75%

	81-04 W6M: 
Sec 11
PNG IN FROM SURFACE TO BASE PEACE RIVER 
EXCL NG IN PADDY  


	MEMORANDUM OF AGREEMENT DATED DECEMBER 2, 1970
Non CAPL clause 24
Ptn. Alberta Crown PNG Lease  32628
	

30 Days
	20.78125% WI
Subject to: 
-Alberta Crown Lessor Royalty
-10% non-convertible GORR to Wyalta Resources Ltd. on 50% of production paid by Barnwell 23.75%







61






	
				
	RIGHT OF FIRST REFUSAL ASSETS   
(File)
	ASSOCIATED 
AGREEMENT
	RESPONSE PERIOD
	VENDOR 
INTEREST

	81-04 W6M: 
Sec 11
NG IN DEBOLT 
EXCLUDING NG IN UPPER DEBOLT, NG IN MIDDLE DEBOLT  
	MEMORANDUM OF AGREEMENT DATED DECEMBER 2, 1970
Non CAPL clause 24
Ptn. Alberta Crown PNG lease 1403A
	

30 Days
	20.78125% WI
Subject to: 
-Alberta Crown Lessor Royalty
-10% non-convertible GORR to Wyalta Resources Ltd. on 50% of production paid by Barnwell 23.75%

	81-04 W6M: 
Sec 11 
NG IN BLUESKY-BULLHEAD 
NG IN UPPER DEBOLT, NG IN MIDDLE DEBOLT  
(C00658)


	MEMORANDUM OF AGREEMENT DATED DECEMBER 2, 1970
Non CAPL clause 24
Ptn. Alberta Crown PNG lease 1403A
	

30 Days
	20.78125% WI*
(*Includes unitized interests described in 3. below)
Subject to: 
-Alberta Crown Lessor Royalty
-10% non-convertible GORR to Wyalta Resources Ltd. on 50% of production paid by Barnwell 23.75%

	81-04 W6M: 
Sec 11 
NG IN PADDY
(C00658)
	MEMORANDUM OF AGREEMENT DATED DECEMBER 2, 1970
Non CAPL clause 24
Ptn. Alberta Crown PNG Lease  32628


	

30 Days
	20.78125% WI* 
*Includes unitized interests described in 3. below
Subject to:
-Alberta Crown Lessor Royalty
-10% non-convertible GORR to Wyalta Resources Ltd. on 50% of production paid by Barnwell 23.75%






		
	2.
	NG in Bluesky-Bullhead, NG in Upper Debolt, NG in Middle Debolt, NG in Lower Debolt unitized under Dunvegan Gas Unit No. 1


Tract 4(a) – Tract Factor = 1.64152 
		
	3.
	NG in Bluesky-Bullhead, NG in Paddy, NG in Upper Debolt, NG in Middle Debolt unitized under Dunvegan Gas Unit No. 1


Tract 5 – Tract Factor  = 1.18612 
Tract 6 – Tract Factor = 3.34550 
Tract 17 – Tract Factor = 0.29890
Tract 5(A) – Tract Factor 5.17839



62






This is Schedule "C" to a Purchase and Sale Agreement made August 10, 2015
between Barnwell of Canada, Limited, as Vendor, and Canadian Natural Resources Limited, as Purchaser




UNIT




	
		
	UNIT DESCRIPTION
	VENDOR’S INTEREST

	That unit known as the Dunvegan Gas Unit No. 1 formed and operated pursuant to the Dunvegan Gas Unit No. 1 Unit Agreement and the Dunvegan Gas Unit No. 1 Unit Operating Agreement, 
both effective August 1, 1973
	Vendor’s entire right, title and interest being not less than a 13.534710% overall Unit Participation interest











63






This is Schedule "D" to a Purchase and Sale Agreement made August 10, 2015
between Barnwell of Canada, Limited, as Vendor, and Canadian Natural Resources Limited, as Purchaser


WELLS


All Unit wells, being those wells owned by and operated under the Unit; and the following specific wells:
	
			
	UWI
	WELL NAME
	LICENSE NUMBER

	100042708003W600
	DEVON ET AL 4D DUNVEG 4-27-80-3
	AB0295672

	102120207902W600
	HANNA BELLOY 12-2-79-2
	AB0216395

	102063507802W600
	HANNA BELLOY 6-35-78-2
	AB0211622

	100162908003W602
	CNRL HZ DUNVEG 16-29-80-3
	AB0190763

	100023108104W603
	CNRL DGU DUNVEG 2-31-81-4
	AB0048668

	100113108003W604
	CNRL ET AL DUNVEG 11-31-80-3
	AB0039965

	100102507802W600
	CNRL ET AL BELLOY 10-25-78-2
	AB0071196

	102032408105W603
	ANDERSON DUNVEGAN 3-24-81-5
	AB0105343

	100103607802W600
	TALISMAN ET AL BELLOY 10-36-78-2
	AB0205210

	100060907902W600
	CNRL ET AL BELLOY 6-9-79-2
	AB0055953

	100063507802W600
	HANNA BELLOY 6-35-78-2
	AB0205211

	100120207902W600
	HANNA BELLOY 12-2-79-2
	AB0207744

	100130408003W602
	CNRL DUNVEG 13-4-80-3
	AB0131795

	100150407902W600
	CNRL BELLOY 15-4-79-2
	AB0217809

	100070307902W600
	CNRL ET AL BELLOY 7-3-79-2
	AB0071162

	100162308104W600
	ANDERSON ET AL DUNVEGAN 16-23-81-4
	AB0192033

	102152908003W600
	CNRL 102 DUNVEG 15-29-80-3
	AB0209900

	100152908003W603
	CNRL DUNVEG 15-29-80-3
	AB0181864

	102132808003W600
	CNRL 102HZ DUNVEG 13-28-80-3
	AB0210638

	100102908003W600
	CNRL 102HZ DUNVEG 10-29-80-3
	AB0210503

	103152908003W602
	CNRL DUNVEG 15-29-80-3
	AB0273387

	103061208104W600
	CNRL TRIPLE DUNVEG 6-12-81-4
	AB0167940

	100102408004W603
	CNRL DGU DUNVEG 10-24-80-4
	AB0047948

	102062908104W600
	ANDERSON ET AL DUNVEGAN 6-29M-81-4
	AB0108162

	100160307902W600
	CNRL BELLOY 16-3-79-2
	AB0217618

	102080108104W602
	CNRL ET AL DUNVEG 8-1-81-4
	AB0153115

	100103507802W600
	CNRL ET AL BELLOY 10-35-78-2
	AB0061742

	100051308003W600
	CNRL DUNVEG 5-13-80-3
	AB0299192

	100012808003W600
	CNRL ET AL 1C DUNVEG 1-28-80-3
	AB0311459

	100161408003W600
	DEVON ET AL 16B DUNVEG 16-14-80-3
	AB0312671

	100030207902W600
	HANNA BELLOY 3-2-79-2
	AB0211927

	100162908003W600
	CNRL HZ DUNVEG 16-29-80-3
	AB0190763

	100113208003W600
	ANDERSON ET AL DUNVEGAN 11-32-80-3
	AB0040166

	1F1142908003W600
	CNRL DUNVEG 14-29-80-3
	AB0216110

	100053507802W600
	HANNA BELLOY 5-35-78-2
	AB0217780

	100111807801W600
	CNRL ET AL BELLOY 11-18-78-1
	AB0036907

	100053607802W600
	HANNA BELLOY 5-36-78-2
	AB0210531

	100152908003w600
	CNRL DUNVEG 15-29-80-3
	AB0181864









64






This is Schedule "E" to a Purchase and Sale Agreement made August 10, 2015
between Barnwell of Canada, Limited, as Vendor, and Canadian Natural Resources Limited, as Purchaser


FACILITIES


Vendor’s entire right, title and interest in and to the facilities associated with the Wells and Pipelines, 
including Vendor’s entire right, title and interest in and to those facilities set forth below, 
but excluding any facilities comprising part of the Excluded Assets:


	
				
	

FILES
	

FACILITY AGREEMENT 
	VENDOR’S INTEREST 
(UI*,PI**,FUPI***)
	

FACILITY
LICENCE

	DUN.U1.5A
	Facilities owned and operated pursuant to the Dunvegan Gas Unit No.1 Unit Agreement & Dunvegan Gas Unit No. 1 Unit Operating Agreement, both effective August 1, 1973
	13.534710%UI
	 

	BLO.F1.5A
	Facilities owned and operated under the Agreement for the Construction Ownership And Operation of the Central Belloy Gas Facilities, effective January 1, 1993
Functional Units: 
•    Gas Plant located at 13-16-78-1W6
•    Refrigeration Plant located at 13-16-78-1W6
•    Field Compressor located at 4-20-78-1W6
•    Water Disposal Well located at 11-18-78-1W6
•    Dehydration Facility located at 4-20-78-1W6
•    Gathering Lines from 3-20-78-1W6 to 13-16-78-1W6 plant
	6.5356% PI




6.5356% FUPI
6.5356% FUPI
6.5356% FUPI
6.5356% FUPI
6.5356% FUPI
6.5356% FUPI
	







2147000003


2147000025
214700004


2147000023

	BLO.F2.5A
	Facilities owned and operated under the Agreement for the Construction Ownership and Operation of the Northwest Belloy 16-36-79-3W6M Gas Processing Facility, effective January 1, 2001 (unexecuted draft)
Functional Units: 
•    Satellite located at 16-36-79-3W6
•    Sweetener located at 16-36-79-3W6
•    Compression and Dehydration located at 16-36-79-3W6
	3.84228% PI




3.38368% FUPI
4.51152% FUPI
3.86700% FUPI
	









#2147000025
#2147000020#2147000021

	DUN.F2.5A
	Agreement for the Construction, Ownership and Operation of the Dunvegan Debolt "BB" Oil Pool 14-29-80-3W6 Production Facility (unexecuted draft dated January 1, 2013)
	15.6514% PI
	 

	DUN.F4.5A
	Agreement for the Construction, Ownership and Operation of the Dunvegan Gas Facilities (unexecuted draft dated January 1, 2013)
•    15 functional units, including plant located at 15-3-81-4W6 and Group Pipelines in Twp 79,80 & 81 Rge 3,4 & 5 W6M
	13.53471% PI
	 

	BLO.G4.5A
	Working Interest Confirmation Letter Agreement – 
Belloy 10-35-78-2W6 to 10-19-078-01W6 Pipeline Facility, dated January 1, 2012 (unexecuted)
	8.60938% PI
	13919

	BLO.G1.5A
	Working Interest Confirmation Letter Agreement – 
Belloy Pipeline 07-03-079-02W6M to 06-09-079-02W6M, dated July 1, 2012 (unexecuted)
	4.5% PI
	15361

	BLO.F3.5A
	Belloy 11-18-78-1W6 Emulsion Battery
(No formal agreement – AFE only)
	6.5356% PI
	 

	BLO.G12.5A
	7-3-79-2W6M to 10-35-78-2W6M Gathering System
(No formal agreement – AFE only)
	8.60938% PI
	 




      *UI = Unit Interest
     **PI = Facility Participation Interest
***FUPI = Functional Unit Participation Interest





65










This is Schedule "F" to a Purchase and Sale Agreement made August 10, 2015
between Barnwell of Canada, Limited, as Vendor, and Canadian Natural Resources Limited, as Purchaser








PIPELINES




Vendor’s entire right, title and interest in and to all pipelines associated with 
the Unit, Wells and Facilities (including flowlines and gathering lines) but excluding any and all pipelines (including flowlines and gathering lines) forming part of the Excluded Assets. 



66






This is Schedule "G" to a Purchase and Sale Agreement made August 10, 2015
between Barnwell of Canada, Limited, as Vendor, and Canadian Natural Resources Limited, as Purchaser






EXCLUDED ASSETS




		
	1.
	Any and all abandoned facilities other than abandoned Unit Facilities;


		
	2.
	Any and all abandoned pipelines (including flowlines and gathering lines) other than abandoned pipelines (including flowlines and gathering lines) owned and operated pursuant to the Unit or comprising part of the Unit Facilities;





67






This is Schedule "H" to a Purchase and Sale Agreement made August 10, 2015
between Barnwell of Canada, Limited, as Vendor, and Canadian Natural Resources Limited, as Purchaser


AFEs


	
		
	AFE NUMBER
	AFE DESCRIPTION

	FF151242
	CNRL ET AL BELLOY 11-18-78-1W6

	AB142696
	100/101008104W6/00

	AB143808
	100/051908104W6/00

	AB144956
	100/140208104W6/00

	AB151034
	100/081408104W6/00

	AB151230
	100/103508004W6/00

	AB151382
	100/153508004W6/00

	AB151389
	100/060208104W6/00

	AB151391
	100/062208003W6/00

	AB151393
	100/083008104W6/00

	AB151400
	100/100208104W6/00

	AB151402
	100/091808104W6/00

	AB151403
	100/081008003W6/00

	AB151404
	100/062008104W6/00

	AB151409
	100/162608004W6/00

	AB151410
	100/100208104W6/00

	AB151414
	100/081008003W6/00

	AB151416
	100/061908104W6/00

	AB152448
	100/062008104W6/00

	AB152550
	100/150408104W6/00

	AB152943
	100/100208104W6/00

	AB153435
	100/061108003W6/00

	FP141462
	100/112108003W6/00

	FP141572
	100/060208104W6/00

	FP141573
	100/153508004W6/00

	FP141574
	100/162608004W6/00

	FP141996
	100/013508004W6/00

	FP151032
	100/150408104W6/00

	FW141914
	100/060208104W6/00

	FW142541
	100/162608004W6/00

	FW151152
	100/103508004W6/00

	TA141291
	100/061908104W6/00

	WO143021
	100/011808003W6/00

	WO143324
	100/091808003W6/00

	WO143342
	100/130908003W6/00

	WO143357
	1W0/050808104W6/00

	WO143358
	100/051608003W6/00

	WO143797
	100/071508003W6/00

	WO143854
	100/162008104W6/00

	WO143961
	100/161908104W6/02







68




	
		
	WO152229
	100/132008003W6/00

	WO152231
	100/023108003W6/00

	WO152409
	100/130808104W6/00

	AFE NUMBER
	AFE DESCRIPTION

	GE141179
	REPROCESSING 2D LINES & 3D MER

	FF141847
	531 SS - PLANT/COMP/BATTERY

	FF142003
	DUNVEGAN GAS UNIT #1 SAT 5 AND

	FF141995
	DUNVEGAN UNIT #1 PLANT

	AB143967
	BELLOY/CINDY 100/13-16-078-01W

	FF141848
	14-29-80-3W6 OIL BATTERY

	FF142147
	DGU #1 SAT #3 100/08-36-080-04

	FF151066
	DUNVEGAN UNIT #1 PLANT

	AB151386
	CNRL FAIRVIEW 4-23-080-03-6 PL

	AB151397
	CNRL FAIRVIEW 7-16-081-04W6 PL

	AB151328
	CNRL DUNVEG 5-25-80-4

	TA141245
	DGU Sat #5B Compressor

	TA141132
	DUNVEGAN PLANT

	TA141247
	DUNVEGAN PLANT

	FF141494
	DUNVEGAN PLANT

	AB142844
	100/10-10-081-04 W6 DGU

	TA141246
	DUNVEGAN PLANT

	TA141311
	8-36-80-4W6 SAT #3A&B

	FP141549
	DUNVEGAN 11-1-81-4W6 UNIT PL'S

	FP141508
	DUNVEGAN 9-21-80-3W6 UNIT PL'S

	AB143006
	ANDERSON ET AL BELLOY 11-9-78-1W6

	FC141256
	DUNVEGAN GAS UNIT #1 SAT 5

	AB143016
	BELLLOY 13-16-078-01W6 GAS PLA

	FC141321
	DUNVEGAN 14-29 BATTERY

	TA141397
	BELLOY 04-20-078-01W6 BOOSTER

	AB143515
	BELLOY 100/11-18-078-01 W6M

	TA141438
	BELLOY16-36-079-03W6

	AB151387
	CNRL FAIRVIEW 5-02-081-04W6 PL

	TA151086
	DUNVEGAN GAS PLANT 15-03-081-0

	FP151032
	FAIRVIEW 100/15-04-081-04W6 PI

	FW151152
	CNRL ET AL DUNVEG 100/10-35-08

	FF151230
	DUNVEGAN UNIT #1 PLANT

	AB151666
	FAIRVIEW 15-35-080-04W6 PIPELI

	WO151581
	CNRL DUNVEG 13-14-80-3W6

	FF151249
	FAIRVIEW 8-36-80-4W6

	AB151401
	CNRL DGU DUNVEG 9-36-81-5

	157018
	BELLOY 102/6-35-78-2 W6

	157019
	BELLOY 5-36-78-2 W6

	157020
	BELLOY 10-36-78-2W6

	156010
	BELLOY 102/12-2-79-2 W6/03









69






This is Schedule "I" to a Purchase and Sale Agreement made August 10, 2015
between Barnwell of Canada, Limited, as Vendor, and Canadian Natural Resources Limited, as Purchaser






PRODUCTION SALES CONTRACTS




Contract #1248155 - Physical Gas Confirmation Agreement dated August 29, 2014 between Barnwell of Canada, Limited and Suncor Energy Marketing Inc., being a one (1) year arrangement for gas volumes of 30 E3m3/d for the remainder of the volumes at Dunvegan #2044 which flow under an assigned FTR agreement, having an expiry date of October 31, 2017, with such volumes are assignable back to Barnwell at the end of its contract term October 31, 2015. 


Contract # 1423960 Physical Gas Transaction Confirmation Agreement dated October 28, 2014 between Barnwell of Canada, Limited and Suncor Energy Marketing Inc., being a two (2) year arrangement for gas volumes of 65 E3m3/d (increased to 70 E3m3/d in June 2015),  having an expiry date of October 31, 2016, but extendible by election no later than October 31, 2015. The original 65 e3m3/d of Barnwell’s FTP service was assigned to Suncor Energy Marketing Inc. at the commencement of the arrangement, and is assignable back to Barnwell of Canada, Limited at the end of the contract term on October 31, 2016. 


Agreement pursuant to Condensate Purchase/Sale Confirmation Notice under “July 1, 2009 General Terms and Conditions” commencing April 1, 2015 between Canadian Natural Resources and Barnwell of Canada, Limited, being a one (1) year arrangement to March 31, 2016 for the sale and delivery of segregated condensate (C5+), delivery point at the Outlet of the Dunvegan 15-03-081-04W6 Gas Plant.


Agreement pursuant to NGL Purchase/Sale Confirmation Notice under “July 1, 2009 General Terms and Conditions” commencing April 1, 2015 between Canadian Natural Resources and Barnwell of Canada, Limited, being a one (1) year arrangement to March 31, 2016 for the sale and delivery of natural gas liquids (C2+) mix, delivery point inside the NGL storage tank at Dunvegan Gas Plant located at LSD 15-03-081-04W6.















70








This is Schedule "J" to a Purchase and Sale Agreement made August 10, 2015 between 
Barnwell of Canada, Limited, as Vendor, and Canadian Natural Resources Limited, as Purchaser




GENERAL CONVEYANCE
    


This Conveyance is made September l, 2015


BETWEEN:


BARNWELL OF CANADA, LIMITED, 
a corporation, in its personal capacity and its capacity as agent and attorney 
("Vendor")


‐ and ‐


CANADIAN NATURAL RESOURCES LIMITED, 
a corporation
("Purchaser")


WHEREAS Vendor has agreed to sell and convey the Assets to Purchaser and Purchaser has agreed to purchase and accept the Assets from Vendor;


THE PARTIES AGREE AS FOLLOWS:


1.        Definitions


In this Conveyance, including the recitals, "Sale Agreement" means the Purchase and Sale Agreement made August 10, 2015 between Vendor and Purchaser.  In addition, the definitions provided for in the Sale Agreement are adopted in this Conveyance.


2.        Conveyance


Vendor, for the consideration provided for in the Sale Agreement, the receipt and sufficiency of which Vendor acknowledges, hereby sells, assigns, transfers and conveys the Assets to Purchaser, and Purchaser purchases and accepts the Assets from Vendor, TO HAVE AND TO HOLD the same absolutely, subject to the terms of the Sale Agreement, the Permitted Encumbrances and compliance with the terms of the Leases.


3.        Effective Date


This Conveyance is effective as of the Effective Date.


4.        Subordinate Document


This Conveyance is executed and delivered by the Parties pursuant to the Sale Agreement for the purposes of the provisions of the Sale Agreement, and the terms hereof shall be read in conjunction with the terms of the Sale Agreement.  The Sale Agreement shall prevail if there is a conflict between the provisions of the Sale Agreement and this Conveyance.



71






5.        Enurement


This Conveyance shall enure to the benefit of and is binding upon the Parties and their respective successors and permitted assigns.


6.        Further Assurances


Each Party shall, after the date of this Conveyance, at the other Party's request and without further consideration, do all further acts and execute and deliver all further documents which are reasonably required to perform and carry out the terms of this Conveyance.


7.        Counterpart Execution


This Conveyance may be executed in as many counterparts as are necessary and all executed counterparts together shall constitute one agreement.


IN WITNESS WHEREOF the Parties have duly executed this Conveyance.




BARNWELL OF CANADA, LIMITED 
in its personal capacity, and its capacity as agent and attorney 








Per:    
Lloyd Arnason, P. Eng.
       President & Chief Operating Officer
                        


CANADIAN NATURAL RESOURCES LIMITED 





Per:    
           Betty Yee,
            Vice President, Land    






This is the execution page to the General Conveyance made September l, 2015 between
Barnwell of Canada, Limited, as Vendor, and Canadian Natural Resources Limited, as Purchaser







72




This is Schedule "K" to a Purchase and Sale Agreement made August 10, 2015 between
Barnwell of Canada, Limited, as Vendor, and Canadian Natural Resources Limited, as Purchaser




CERTIFICATE




		
	RE:
	Purchase and Sale Agreement made August 10, 2015 between Barnwell of Canada, Limited, as Vendor, and Canadian Natural Resources Limited, as Purchaser (the "Agreement")






Unless otherwise stated, the definitions provided for in the Agreement are adopted in this Certificate.


l ("Vendor") [("Purchaser")] hereby certifies that as of the date of this Certificate:


1.        In all material respects, Vendor [Purchaser] has performed or complied with each of the terms, covenants and conditions of the Agreement to be performed or complied with by Vendor [Purchaser] on or prior to the Closing Date.


2.        Each of Vendor's [Purchaser's] representations and warranties contained in Article 6 of the Agreement was true and correct in all material respects as of the date of the Agreement and each is true and correct in all material respects as of the Closing Date.


3.        There has been no alteration of, or damage to, the Assets in the period from the Effective Date to the Closing Date.


4.        This Certificate is made with full knowledge that Purchaser [Vendor] is relying on the same for Closing.


5.         This Certificate is being provided by the undersigned in their capacity as the officer of Vendor (Purchaser) and not in any personal capacity.




IN WITNESS WHEREOF the undersigned has executed this Certificate on September l, 2015.




l




Per:    
Name:
Title: