Exhibit 10.2


 


CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN REDACTED BECAUSE CONFIDENTIAL
TREATMENT FOR SUCH INFORMATION HAS BEEN REQUESTED. THE REDACTED MATERIAL HAS BEEN SEPARATELY FILED WITH THE SECURITIES AND EXCHANGE COMMISSION,
AND THE INFORMATION HAS BEEN MARKED AT THE APPROPRIATE PLACE WITH BRACKETS AND THREE ASTERISKS [***].


 


PRODUCTION SHARING
AGREEMENT FOR OIL

EXPLORATION AND EXPLOITATION


 


Between


 


 


THE GOVERNMENT OF THE REPUBLIC OF BENIN


 


 


And


 


 


THE COMPANY: ELEPHANT OIL LTD


 


 


CONCERNING 


 


 


BLOC B


 


 






     


     


    

 


TABLE OF CONTENTS 


 




	PREAMBLE	3
	ARTICLE 1:	DEFINITIONS	4
	ARTICLE 2:	 SUBJECT-MATTER OF THE CONTRACT	9
	ARTICLE 3:	CONTRACT VALIDITY PERIOD	10
	ARTICLE 5:	SURFACE AREA RETROCESSIONS	13
	ARTICLE 7:	TECHNICAL AND BUDGETARY MANAGEMENT COMMITTEE	14
	ARTICLE 8:	ANNUAL WORK PROGRAMME, BUDGETS AND REPORTS	15
	ARTICLE 9:	DECLARATION OF COMMERCIAL DISCOVERY AND DESIGNATION OF THE DEVELOPMENT ZONE	18
	ARTICLE 10:	 EXCLUSIVE RISKY OPERATIONS	20
	ARTICLE 11:	GOVERNMENT PARTICIPATION	21
	ARTICLE 12:	 ROYALTIES, COST RECOVERY & PRODUCTION SHARING	21
	ARTICLE 13:	MEETING THE NATIONAL CONSUMPTION NEEDS	22
	ARTICLE 14:	APPLICABLE TAX SYSTEM	23
	ARTICLE 15:	MEASUREMENT, PROVISION, EVALUATION AND SALE OF HYDROCARBONS	25
	ARTICLE 16:	NATURAL GAS	27
	ARTICLE 17:	DAMAGES, ABANDONMENT, ENVIRONMENTAL PROTECTION AND SECURITY	29
	ARTICLE 18:	 FOREIGN EXCHANGE ARRANGEMENTS	32
	ARTICLE 19:	LOCAL CONTENT, SOCIAL PROGRAMMES AND SIGNING BONUS	33
	ARTICLE 21:	CONFIDENTIAL NATURE OF THE DATA	35
	ARTICLE 22:	ASSIGNMENT OF RIGHTS	36
	ARTICLE 23:	FORCE MAJEURE	37
	ARTICLE 24:	ARBITRATION AND EXPERTISE	38
	ARTICLE 25:	CANCELLATION	39
	ARTICLE 27:	 NOTIFICATION	41
	ARTICLE 28:	APPLICABLE LEGISLATION, STABILISATION AND COMPENSATION	42
	ARTICLE 30:	GUARANTEES FROM PARENT COMPANIES	44
	ARTICLE 31:	FINAL PROVISIONS	45


 






    Page 2 of 52


     


    

 


PREAMBLE


 


WHEREAS: 


 


In accordance with Law No. 2006-18 of 17 October
2006 constituting the Oil Code of the Republic of Benin, the exploration, research, exploitation, holding, transport, transit and trade
of Hydrocarbons on the territory and in the territorial waters of the Republic of Benin and the continental shelf adjacent thereto shall
be subject to the provisions of the aforesaid law, which furthermore stipulates that deposits of liquid and gaseous Hydrocarbons belong
to the State and constitute transferable minerals.


 


In accordance with Article 15, the Government
may undertake any oil operation alone or in association with private capitals. It may undertake any prospecting operation without the
authorization set out in article 5 of this Oil Code.


 


It may issue to any public service or enterprise
enjoying legal entity status, an oil title or a provisional authorization to exploit or prospect as set out in articles 5, 6, 7 and 8
of the Oil Code.


 


In accordance with Article 20, no person may acquire
the hydrocarbons research permit or permit H if they do not show the necessary technical capacities and financial base to undertake the
research activities and if they do not subscribe to the commitment to allocate a minimum appropriate financial effort to research during
the validity period of the permit.


 


A minimum works programme, a training programme
for national employees, the income tax system and the financial effort agreed upon should be defined in the oil contract.


 


In accordance with Article 11, Elephant Oil Ltd
must establish a subsidiary domiciled at its headquarters in the Republic of Benin, which, from its date of registration, shall replace
Elephant Oil Ltd in its rights and obligations for the conduct of Oil Operations without any other authorisation being necessary.


 


In accordance with the Oil Code in effect in the
Republic of Benin, the parties wish to enter into this Contract, under the form of a production-sharing agreement for oil exploration
and exploitation.


 


The Government of the Republic of Benin has decided
to enter into this contract with the company:


 


ELEPHANT OIL LTD


 


The undersigned parties, represented by:


 


on the one hand, Mr. Barthélémy
Dahoga KASSA,


 


The Minister of Energy, Oil and Mining Research,
Water and Development of Sustainable Energy.


 


And


 


on the other hand by Mr. Matthew LOFGRAN,


 


President of ELEPHANT OIL LTD


 


Hereby agree to the following:


 


The following terms appearing in the Contract
shall be defined as follows unless otherwise expressly indicated or unless otherwise agreed upon by both parties. The definitions shall
be the same whether the terms are used in the singular or plural form.


 






    Page 3 of 52


     


    

 


ARTICLE 1: DEFINITIONS


 


		1.1	“Affiliate” or “Affiliated Company” shall mean a company or any
other enterprise that controls one or several enterprises that comprise the Contractor, or that is controlled by one or several enterprises
that comprise the Contractor, or that is controlled by an enterprise that controls the Contractor. Controlling shall mean to directly
or indirectly hold more than fifty percent (50%) of the shares comprising the capital of the controlled company, thus conferring to the
enterprise holding the control, the majority of the voting rights in the controlled company.



 


		1.2	“Calendar Year” shall mean a period of twelve (12) consecutive months starting on the
first of January and ending the thirty-first of the following December.



 


		1.3	“Contract Year” shall mean a period of twelve (12) consecutive months from the Effective
Date of the Contract or the anniversary date of its signature.



 


		1.4	“Appendix” shall mean an appendix attached to the Contract and forming an integral
part of the Contract. In case of non-conformity or a conflict between the Contract and one of its appendixes, the provisions of the Contract
shall prevail.



 


		1.5	“Accounting Appendix” shall mean the accounting procedures and formalities set out
in Appendix “D”.



 


		1.6	“Article” shall mean any numbered provision of the Contract, including all its sub-clauses,
unless it is expressly indicated that it is an article of the Code.



 


		1.7	“Barrel” shall mean a US Barrel, a quantity or unit of Oil measurement equivalent to
158.5556 litres.



 


		1.8	“BLOC” is
defined as the area defined by the geographic coordinates and map found in Appendix B. 



 


		1.9	“Available Crude” shall mean the remaining quantity of the Total Production of the
Crude extracted in the Contract Region after deducting losses related to Oil Operations and the Tax on Oil Production in accordance with
Article 12.1 of this Contract.



 


		1.10	“Crude Profit” or “Oil Profit” shall mean the remaining Crude Oil every
year after deducting the Oil Cost.



 


		1.11	“Budget” shall mean the financial estimate of all oil activities in an Annual Works
Programme.



 






    Page 4 of 52


     


    

 


		1.12	“Code” shall mean the law No. 2006-18 of 17 October 2006 relating to the Oil Code in
the Republic of Benin.



 


		1.13	“Contractor” shall mean Elephant Oil Ltd and its subsidiary, which will be created
pursuant to Article 11 of the Oil Code, as well as its successors and/or any transferee enjoying any of its rights in accordance with
the Contract, the transfer of which shall be in conformity with Article 22.



 


		1.14	“Contract” shall mean this document in its original version, duly signed including
its Appendixes and any amendment that the Parties may sign subsequently.



 


		1.15	“Production Costs” shall mean the costs and fees caused by the Production Operations
not including the new investments made during this phase. These costs also include the exportation costs of Hydrocarbons as well as the
maintenance and abandonment costs of the oil installations.



 


		1.16	“Oil Costs” shall mean all costs and fees related to Oil Operations in accordance with
the Contract and set out in the Accounting Appendix.



 


		1.17	“Exploration Costs” shall mean the costs and fees related to Exploration operations.



 


		1.18	“Development Costs” shall mean the costs and fees related to the Development Operations.



 


		1.19	“Cost-Stop” shall mean the Crude intended for the recovery of the Oil Costs.



 


		1.20	“Starting Date of the Commercial Production” shall mean the date of first delivery
of Hydrocarbons in commercial quantities to the delivery point in Benin.



 


		1.21	“Effective Date” shall mean the date on which this Contract is signed by the duly authorized
representatives of both Parties.



 


		1.22	“Discovery” shall mean the detection of Hydrocarbons from a reservoir or geological
structure where such Hydrocarbons were not previously identified, leading to Oil Operations in accordance with the Contract, and when
these Hydrocarbons are made recoverable on the surface through conventional methods used in the international oil industry.



 


		1.23	“Commercial Discovery” shall mean a Hydrocarbon Discovery reserves following Exploration
Operations that is deemed commercial in accordance with the provisions of Article 9.



 


		1.24	“Foreign currency” shall mean any foreign currency that may be exchanged freely and
generally accepted by the international banking system.



 


		1.25	“Dollars” shall mean the official currency of the United States of America.



 


		1.26	“F CFA” is the official currency in the Republic of Benin.



 


		1.27	“Data” shall mean any document, report and information of a technical, economic or
scientific nature concerning the Contract Region.



 


		1.28	“Expatriate Employee” shall mean an employee of the Contractor or of a sub-contractor
who has been recruited as such and assigned to the Oil Operations in Benin.



 


		1.29	“State” shall mean the Republic of Benin, its Government, its administrative structures
and all political subdivisions and institutions.



 






    Page 5 of 52


     


    

 


		1.30	“Exploration” shall mean the planning, implementation and evaluation of any type of
geological, geophysical, geochemical studies and others as well as drilling Exploration Wells for the purpose of a Hydrocarbon Discovery.



 


		1.31	“Exploitation’’ shall mean the operation consisting of extracting Hydrocarbon
substances for disposal for utilitarian purposes.



 


		1.32	“Associated Gas” shall mean the Gas extracted from a well along with Crude Oil.



 


		1.33	“Natural Gas” shall mean Hydrocarbons in their gaseous state in normal conditions of
atmospheric pressure and temperature, including, without any limitation, wet gas, dry gas, casing head gas and any gaseous hydrocarbon,
including residual gas after liquid condensation or extraction, but does not include the said extracted condensates or liquids.



 


		1.34	“Non-Associated Gas” shall mean the Natural Gas that is exploited in parallel with
the Crude Oil or that exists in parallel with Crude Oil that cannot be produced commercially whereas the said Natural Gas is produced
commercially.



 


		1.35	“Gas Deposit” shall mean one or several Natural Gas accumulations superposed vertically
in the Contract Region and having an established commercial value in accordance with Best Practices.



 


		1.36	“Oil Deposit” shall mean an accumulation of Crude Oil, or multiple vertically superposed
accumulations of Crude Oil in the Contract Region and having an established commercial value in accordance with Best Practices.



 


		1.37	“Government” shall mean the organ grouping together all the Ministers of the State.
In this Contract, it shall mean the Government of the Republic of Benin, its representatives or proxies.



 


		1.38	“Hydrocarbons” shall mean Crude Oil and/or Natural Gas.



 


		1.39	“Working Day” shall mean all working days from Monday to Friday except for days declared
totally or partially non-working days in Cotonou, Benin by the appropriate governmental authorities.



 


		1.40	“Minister” shall mean the Minister in charge of Hydrocarbons in the Republic of Benin.



 


		1.41	“Exploration Operations” shall mean operations undertaken in accordance with the Contract
to discover Hydrocarbon accumulations and to evaluate the extent and volume of these accumulations, the characteristics of the Reservoirs
and their probable behaviour during production. The Exploration Operations shall include geological, geophysical and geochemical research,
studies, drilling, deepening, abandonment or conditioning of wells and their evaluation as well as any related operations.



 


		1.42	“Development Operations”
                                            shall mean all operations undertaken in accordance with the General Development Programme
                                            in order to exploit Hydrocarbon
                                            accumulations in the sub-soil of the Development Zones. These operations shall include:



 


		●	Drilling,
                                            conditioning and sampling of development wells, drilling and conditioning of wells to inject
                                            gas or water; 



 


		●	The
                                            installation of gathering pipelines, separators, reservoirs, pumps, artificial loaders and
                                            other production and injection facilities required to produce, treat and transport the Hydrocarbons
                                            up to the earth-based or offshore Hydrocarbon storage facilities or gas treatment facilities;
                                            and



 






    Page 6 of 52


     


    

 


		●	The
                                            installation of pipes inside or outside the Contract Region to the storage or delivery points,
                                            the construction of these facilities to stock Crude Oil or treat the Gas and all related
                                            operations that are not explicitly mentioned in this document but that are needed for the
                                            development and production of these Hydrocarbon accumulations and for the delivery of Crude
                                            Oil and/or gas to the Delivery Point, in accordance with Best Practices.



 


		1.43	“Oil Operations” shall mean all operations authorized by the Contract and that are
related to exploration, development, production, separation and treatment, storage, transportation and selling or transferring of Hydrocarbons
up to the exportation point or to the Delivery Point agreed upon in Benin or to the delivery point in a refinery in Benin in accordance
with the Contract; they shall cover the treatment operations of the Natural Gas but shall not include refining operations of the Crude
Oil.



 


		1.44	“Production Operations” shall mean operations undertaken to produce Hydrocarbons in
the Contract Region such as extraction, injection, stimulation, treatment, storage, transportation to the delivery point(s), loading,
including exportation of those Hydrocarbons, as well as the maintenance and abandonment of the required facilities.



 


		1.45	“Parties” shall mean the Government and the Contractor.



 



		1.46	“Crude Oil” shall mean the crude mineral oil, asphalt, ozokerite and all other types
of Hydrocarbons and bitumen, solid or liquid, in the natural state or obtained from the Natural Gas by condensation, separation or extraction.



 


		1.47	“Delivery Point” shall mean the Terminal Point of the Pipelines downstream from the
storage facilities from which the Oil or the Gas is delivered to be exported. The location of the Delivery Point shall be agreed upon
by both Parties.



 


		1.48	“Commercial Production” shall mean the quantity of Crude Oil or Natural Gas or both,
likely to be delivered to the Delivery Point in accordance with a regular production and sales programme.



 


		1.49	“Total Crude Oil Production” shall mean the quantity of Crude extracted from the Contract
Region after extracting the water, foreign substances and after deducting the quantities used for Oil Operations.



 


		1.50	“Work Programme” shall mean all plans developed every year to carry out the Oil Operations.



 


		1.51	“General Development Programme” shall mean a plan established for the development of
an Oil Deposit or a Gas Deposit agreed upon by the Parties.



 



		1.52	“Appraisal Well” shall mean a well, different from an exploration well, drilled to
assess the commercial viability of a geological trap where Hydrocarbons have been discovered.



 


		1.53	“Exploration Wells” shall mean any well drilled as part of the Exploration Operations
including dried wells and discovery wells.



 


		1.54	“Development Wells” shall mean a well drilled in order to produce Hydrocarbons from
a known Reservoir assessed and tested, to maintain and increase production, or to speed up the extraction, including production and injection
wells.



 


		1.55	“Contract Region” shall mean the entire geographical area defined by the perimeter,
the coordinates of which appear in Appendix “A” and that are represented on the map in Appendix “B”, except any
part for which the Contractor has, from time to time, abandoned or renounced its rights in accordance with the Contract. In case of non-compliance
or conflict between Appendix “A” and Appendix “B”, Appendix “A” shall prevail.



 






    Page 7 of 52


     


    

 


		1.56	“Best Practices” shall mean all good, healthy, economic and efficient practices generally
accepted in the international oil industry.



 


		1.57	“Reservoir” shall mean the subsoil rock containing Hydrocarbon in its voidages and
having a common pressure system in its dimensions.



 


		1.58	“SOBEH” is a national
                                            company with the mission of holding, managing and investing in any way whatsoever on behalf
                                            of the Government or on its own behalf directly or indirectly in all activities associated
                                            with the research, exploitation, commercialisation of crude oil, refining operations and
                                            all activities directly related to the activities indicated above;



 


		1.59	“Basement” shall mean eruptive, metamorphic or other rocks that, based on their nature
and according to widely accepted knowledge in the international oil industry, cannot contain Hydrocarbon deposits on the one hand, and
on the other hand, impenetrable rock substances such as salt and clay domes as well as any other rock rendering the continuation of drilling
activities impracticable or economically unjustifiable using modern drilling technology normally used in the international oil industry.



 


		1.60	“Sub-Contractor” shall mean any individual or legal entity the Contractor uses to provide
services pursuant to the Contract.



 


		1.61	“London Inter-Bank Offered Rate (LIBOR)” shall mean the closing interest rate for deposits
in dollars at six (6) months on the London Interbank market and published by the London branch of “The Bank of America” or
by any other bank agreed upon by the Parties, the day in question or the immediate preceding bank day if the day in question is not a
working bank day in London.



 


		1.62	“Interest rate of the Contract” shall mean the “LIBOR rate” plus one percent.



 


		1.63	“Oil Production Tax” shall mean the Royalty (proportional mining royalty) as defined
in the Code and shall not be less than [***]% of the Total Crude Oil Production.



 


		1.64	“Test” refers to any operation intended to evaluate the capacity of a zone to produce
Hydrocarbons using MDT and/or DST tools.



 


		1.65	“Quarter” shall mean a period of three (3) consecutive months to be counted respectively
from 1 January , 1 April , 1 July and 1 October of each Calendar Year.



 


		1.66	“Sales to Third Parties” shall mean sales of Hydrocarbon products in the Contract Region
and meeting the following requirements:



 


		(a)	The price agreed upon shall be the only consideration for the sale;



 


		(b)	The sales conditions shall not be subject to any commercial relationship other than the one created by
the Sales Agreement itself between the seller and the buyer or any of their Affiliates;



 


		(c)	Neither the seller nor any of its Affiliates shall have a direct or indirect interest in the sale or future
transfer of the Hydrocarbons or in any derivative product;



 


		(d)	These sales shall not entail any processing agreement or barter or exchange agreement.



 






    Page 8 of 52


     


    

 


		1.67	“Development Zone” shall mean the portion of the Contract Region that, according to
the available seismic information and data on the wells, is reasonably qualified to cover the horizontal span of Hydrocarbon accumulation
constituting a Commercial Discovery and designated as such in an approved Global Development Programme. The Development Zone shall comprise
the depth corresponding to the assessed and tested reservoirs between the surface and the basement.



 


ARTICLE 2: SUBJECT-MATTER OF THE CONTRACT


 


		2.1	By this Contract, the Government shall give to the Contractor the exclusive right to undertake Oil Operations
in the Contract Region in order to exploit, develop and produce Hydrocarbons in that region, in accordance with the provisions of the
Oil Code and the Contract, in compliance with the laws and regulations in force in the Republic of Benin. The Government shall implement
all necessary administrative procedures so as to allow the Contractor to enjoy its rights and to perform its duties.



 


		2.2	In accordance with article 20 of the Oil Code, the Contractor declares that it possesses the necessary
technical and financial capacities and agrees to undertake all of the Oil Operations in accordance with this Contract and Best Practices.



 


		2.3	With regard to the Bloc, once a General Development Programme concerning a Hydrocarbons Discovery is approved
in the shortest deadlines, in accordance with the terms of the Contract, the Contractor shall enjoy the full rights to conduct the Development
and Production Operations and shall hold the benefit of these economic activities in usufruct provided that the obligations of the Contract
and the Code are respected.



 


		2.4	The Contractor shall be bound to supply all necessary technical, financial, human and economic resources
for the Oil Operations. Subject to the proportional interest of the Government, which the Contractor accepts under a portage arrangement,
all costs and outlays incurred through the Oil Operations shall be the responsibility of the Contractor who shall support them exclusively.
Moreover, the Contractor shall act as the technical, financial and economic manager of the Oil Operations during the exploratory period.



 


		2.5	The Minister in charge of Hydrocarbons in his capacity as the Representative of the Government, shall
be in charge of supervising the Oil Operations to ensure that the Contractor is performing his duties in accordance with the Contract.
The Minister shall carry out this duty at any moment through its technical services, which include the General Directorate of Hydrocarbons
and other Fossil Fuels. The Contractor is required to facilitate the access of the representatives of the Minister to its data and facilities
to allow them to accomplish their missions through the operational fund set up by the Companies.



 






    Page 9 of 52


     


    

 


ARTICLE 3: CONTRACT VALIDITY PERIOD


 


		3.1	Effective Date



 


The Contract shall be effective from
its date of signing by the Minister in charge of Hydrocarbons and shall end at the expiry date indicated below, subject to the provisions
of Article 25 relating to termination.


 


		3.2	Validity Period 



 


		3.2.1	The duration of the Contract shall be divided into two periods: an exploration period and an exploitation
period.



 


		3.2.2	The exploration period shall comprise an initial phase of [***], with [***] possible extension
phases of [***] each. These extensions shall be granted provided that the Contractor has fully respected its working, retrocession
and expense obligations and other significant obligations related to the preceding phase.



 


		3.2.3	Subject to fulfilling all of the obligations related to the ongoing phase, the Contractor may request
in writing to the Minister to move on to the next phase (first or second extension phase) at least [***] calendar days before the
end of the said phase. If this request is not made on time and if a Commercial Discovery has not been made, the Contract shall end at
the end of the phase in question of the exploration period.



 


		3.2.4	Subject to the provisions relating to termination and in case no Hydrocarbon Discovery has been made during
the exploration period, the Contract shall expire at the end of that period.



 


If at least one (1) Commercial Discovery
has been made before the end of the exploration period, the Contract shall remain in force with regard to the corresponding Development
Zones.


 


		3.2.5	In case of Commercial Hydrocarbon Discovery, the Government shall automatically grant to the Contractor
at its request an exploitation permit covering the Development Zone, the perimeter of which has been approved in the context of a General
Development Programme in accordance with the provisions of Article 9. The duration of the exploitation permit during which the Contractor
shall be authorized to ensure the production of each discovered Oil Deposit or Gas Deposit shall be fixed at [***] from the date
the discovery is declared to be a Commercial Discovery in accordance with the provisions of Article 9 of the Contract.



 


Over the duration
of the Contract, the Contractor may retrocede one or several Development Zones, object of an exploitation permit subject to the approval
of the Minister.


 


		3.2.6	If after the expiration of the exploitation period defined above, commercial exploitation is still possible,
the Contractor may be authorized at its request, to continue the exploitation for an additional period of [***], if it has fulfilled
all the contractual obligations during the preceding exploitation period.



 






    Page 10 of 52


     


    

 


		3.2.7	When the last exploitation permit given to the Contractor expires, the rights and obligations defined
in this Contract shall be null and void.



 


		3.2.8	To be granted an exploitation authorization, the Contractor shall submit to the Government a precise delimitation
of the required perimeter in such a way that it covers the entire presumed surface area of the discovered Deposit.



 


		3.2.9	If, during the works subsequent
                                            to the discovery it appears that the deposit has a greater surface area than initially planned
                                            in accordance with the previous paragraph, the Government shall grant to the Contractor in
                                            the context of the exploitation authorization already given, the additional surface area
                                            in such a way that all the deposits are covered, on condition
                                            that the above-mentioned extension be an integral part of the Contract Region as it is defined
                                            during the said modification. If the said additional surface area is outside the Contract
                                            Region, the Government shall give to the Contractor this additional surface area if it is
                                            not the object of mining rights already given to a third party or a request for such rights.









 


ARTICLE 4: OWNERSHIP
OF ASSETS, DATA AND HYDROCARBONS


 


		4.1	Ownership of
                                            assets



 



		4.1.1	The
                                            land shall become Government property as soon as they are acquired by the Contractor. The
                                            Minister must cooperate in taking all the steps in favour of the Contractor and at the written
                                            request of the latter, to obtain licenses, permits, surface rights, utilities, rights to
                                            have access and leave the Contract Region freely, utilisation of waters and any other type
                                            of utilities on any land or water body of public or private utility, to allow the Contractor
                                            to achieve the Oil Operations on the Benin territory, in accordance with the laws in force
                                            in the country.



 


		4.1.2	Without
                                            prejudice to the above-mentioned provisions, the ownership of the moveable and non-moveable
                                            assets acquired by the Contractor and belonging to it/her for the Oil Operations, shall be
                                            automatically transferred from the Contractor to the Government as soon as their cost has
                                            been totally depreciated by the Contractor, who continues to use it for production needs
                                            or, otherwise, at the end of the Contract. When the Contract expires, the Contractor shall
                                            be required to give back to the Benin Government, through the Minister and exempt of any
                                            tax, the ownership of lands, buildings, installations, accessories and permanent equipments
                                            that it has acquired to undertake the Oil Operations. After that, the Contractor shall be
                                            free of any obligation, including obligations stemming from abandonment procedures and rehabilitation
                                            of the environment with regard to the said assets if the activities of the field were to
                                            continue. During the validity period of the Contract, the Contractor shall be bound to conserve
                                            and preserve in good state the moveable and non-moveable assets acquired to conduct the Operations.



 






    Page 11 of 52


     


    

 


		4.1.3	The
                                            ownership of rented assets or leased moveable assets and the intellectual property belonging
                                            to sub-contractors or Affiliates and the intellectual property of belonging to other third
                                            parties shall be kept by the said sub-contractors, affiliates or third parties.



 


		4.1.4	Over
                                            the duration of the Contract, the Contractor shall be authorized to use and enjoy all moveable
                                            and non-moveable assets acquired for the Oil Operations in accordance with the Contract.
                                            The Contractor shall be authorized to hand over or sell the said assets if they are no longer
                                            necessary for Oil Operations. Profits made from selling these assets shall be allocated as
                                            follows:



 


		●	If
                                            the ownership of the said assets has been transferred to the Government, the product must
                                            be paid to the latter;



 


		●	The
                                            Contractor shall keep these revenues if the assets have not been depreciated; 



 


		●	In
                                            case of partial depreciation, the revenue corresponding to the proportion of the depreciation
                                            shall be paid to the Government. 



 


The disposal or transfer of moveable or non-moveable
assets during the period of validity of the Contract must be authorised in advanced by the Minister.


 


		4.2	Ownership of the Data 



 


The Government shall be the owner of all geological,
geophysical and geochemical information and data related to drilling, engineering, registrations and production and of all other data,
samples, logs, cores, bands, maps, interpretations, reports and any other support or information obtained during the Oil Operations. However,
the Contractor shall be authorized to keep this information, free of charge and use it for Oil Operations subject to obligations related
to its confidential nature.


 


The Government shall give the Contractor access
to all existing technical, operational, accounting and financial information, among others, from the Effective Date of the Contract. It
is understood that the Contractor shall treat this data and information confidentially in accordance with Article 21 of this Contract.


 


		4.3	Ownership of the Hydrocarbons 



 


All Hydrocarbons contained in the Reservoirs of
the sub-soil of the Contract Region or produced in the Contract Region shall be the property of the Government, in accordance with the
Code and the Constitution of the Republic of Benin. The Contract shall not give to the Contractor any ownership rights over the Crude
Oil and/or Gas extracted from the Contract Region, which will continue to be the property of the Government until they are measured at
the Delivery Point. The rights of ownership of the Contractor over the Crude Oil and/or Gas in accordance with the provisions of the Contract
shall be given to it at the appropriate Delivery Point.


 




    Page 12 of 52


     


    

 


ARTICLE 5: SURFACE AREA
RETROCESSIONS


 


		5.1	At the end of each phase of the exploration period and provided that the Contractor has met all the obligations
related to that phase, if the latter decides to continue the Oil Operations in the Contract Region, it shall be bound to retrocede [***]%
of the Region covered by the phase upon each renewal.



 


		5.2	The Regions retroceded by the Contractor
                                            shall be one block and of simple geometric form in order to allow the execution of Oil Operations
                                            by other entities. The Contractor must notify the Minister of the Region(s) that it wishes
                                            to give up in writing within no more than [***] days before the end of the considered
                                            period by including a map showing the geographical location and giving the coordinates of
                                            the connection point of the boundary lines. In the [***] days following the date of
                                            notification, the Minister must let the Contractor know his decision who must abide by it.



 


		5.3	From the expiry date of the Contract, the Contractor is considered to have given up all the Contract Region
to the Government, which retrocedes it to SOBEH.



 


		5.4	[***] after each retrocession, the Contractor must submit a report to the Minister on the surface
areas given back and give him all documents and files concerning them and the installations that are there, with the possibility of making
copies of the said documents and files subject to respecting the clauses of confidentiality.



 


ARTICLE 6: OBLIGATIONS RELATED TO EXPLORATION
WORKS


 


		6.1	Minimum work obligations



 



		6.1.1	The Contractor shall start the Oil Operations from the Effective Date of this Contract. To this effect,
it shall notify to the Minister the nominal composition of the team in charge of conducting and implementing the Contract in Benin as
well as the major terms of its agreement with its partner(s).



 


		6.1.2	During the initial phase of the exploration period of [***] maximum, the Contractor agrees to implement
the following minimum work programme:



 


[***]


 


		6.1.3	During the first extension phase of [***], the Contractor must at least complete the following
works:



 


[***]


 


		6.2	Minimum well depth



 


		6.2.1.	Each of the aforesaid Exploration Wells must be drilled to the minimum depth or a
lesser depth if the Minister so authorises in accordance with this Article or if drilling is justifiably interrupted for one of the following
reasons:



 


		(a)	the economic base is reached at a lesser depth than the stipulated minimum contractual depth;



 


		(b)	it would be clearly dangerous to continue drilling due to abnormal pressure in the formation;



 


		(c)	hard rocky formations are reached which render it impossible to continue drilling with the appropriate
equipment; or



 


		(d)	formations containing Hydrocarbons are discovered, which require the installation of protective casings,
excluding the possibility of reaching the minimum contractual depth.



 






    Page 13 of 52


     


    

 


		6.2.2.	For the purposes of Article 6.2.1, the term economic base refers to any layer in which and
below which the geological structure or the physical characteristics of the rock sequences does not have the properties necessary for
the accumulation of Hydrocarbons in commercial quantities, which also corresponds to the maximum depth at which any accumulation of this
type may be reasonably expected to be found.



 


		6.2	Cessation of Drilling 



 


Except in situations in which a prudent
operator would immediately cease all drilling operations, the Contractor must obtain approval from the Minister in charge of Hydrocarbons
before beginning, interrupting or ceasing all drilling. The Minister shall respond within seventy-two hours of this request. This authorisation
may not be refused or delayed without justification, provided that the Minister has been provided the necessary information to allow him
to make a decision with full knowledge of the case.


 


		6.3	Replacement Wells



 


If a mandatory Exploration well is
abandoned due to insurmountable technical problems such as those described in Articles 6.2.1(b), (c) and (d) and if at the time of this
abandonment, the Exploration Costs associated with this Well are greater than or equal to the amount of the mandatory exploration well,
the Contractor shall be considered to have fulfilled its minimum work obligations in this case with regard to this Well for the period
concerned.


 


If a mandatory Exploration Well is
abandoned due to insurmountable technical problems and if at the time of this abandonment, the Exploration Costs corresponding to this
Well are less than the amount of the mandatory exploration well, the Contractor shall then have the option to either:


 


		(a)	drill a replacement Exploration Well in the same location or another location to be established by mutual
agreement with the Minister in charge of Hydrocarbons;



 


		(b)	or to pay the Minister an amount equal to the difference between the amount allocated for the drilling
of the exploration well and the amount of Exploration Costs actually incurred with regard to this Exploration Well.



 


ARTICLE 7: TECHNICAL AND BUDGETARY MANAGEMENT
COMMITTEE


 


		7.1	Within [***] days of the date of signing of the Contract, the Parties shall establish a joint committee
for technical and budgetary management comprised of representatives of the Minister in charge of Hydrocarbons and the contracting Parties.
The number of representatives of each party is established by mutual agreement. A representative of the Minister will chair the Management
Committee. A representative of the oil company will act as its secretary. It will include a sub-committee:



 


The technical management sub-committee
shall meet twice per year: [***].


 


The duties of this sub-committee shall
include the assessment of the technical works to be performed by the contracting Parties. The tasks of this sub-committee shall be in
preparation for those of the budget committee. The various topics addressed by the technical management sub-committee shall include the
important events recorded since the last session, the production and behaviour of the fields, activities performed and the programme of
works.


 


		7.2	Once per year, the contracting Parties shall meet to make a technical presentation of the Operations,
examine the budget and validate the previous budget.



 






    Page 14 of 52


     


    

 


ARTICLE 8: ANNUAL
WORK PROGRAMME, BUDGETS AND REPORTS


 


		8.1	Presentation of the Annual Work Programme and Budgets



 


Within [***]
days following the Effective Date of the Contract, the Contractor must prepare the first Work Programme and its budget. If the Effective
Date of the Contract falls on the [***] day of the month of [***] or before, the first Programme and its budget shall be
prepared for the rest of the corresponding calendar year. If the Effective Date of the Contract falls after the first of [***],
this first Programme and its budget shall be prepared for the ongoing calendar year and for the next calendar year. The Contractor must
submit the Work Programme and its budget for the Minister’s approval.


 


Subject to the provisions
above, at the latest on the [***] of [***] of each calendar year, the Contractor must prepare a Work Programme and a budget
for the next calendar year and must submit them for the Minister’s approval.


 


The Work Programme
submitted for the Calendar Year during which a Commercial Discovery is made must be modified by the Contractor within [***] days
following the date of approval of the General Development Programme in order to comply with the latter.


 


		8.2	Form and approval of the Annual Work Programme and Budgets



 


This Annual Work
Programme and corresponding Budget shall present the various Exploration, Development and Production Operations separately, as applicable.


 


Each Annual Work
Programme shall at least include the work to be performed during the period in question to execute the minimum work programme, the Development
Programme or the Production Programme.


 


The Annual Work Programme
and the corresponding Budgets are submitted for the approval of the Minister in charge of Hydrocarbons. This approval must be provided
within [***].


 


The sections of the
Annual Work Programme and Budgets regarding which the Minister in charge of Hydrocarbons does not request any amendment or modification
shall be considered approved and must be executed by the Contractor within the indicated period, provided that they can be performed separately.


 


As for the sections
of the Annual Work Programme and Budgets regarding which the Minister in charge of Hydrocarbons proposes an amendment or modification,
the approval date of the Annual Work Programme or corresponding Annual Budget shall be the date on which the Minister in charge of Hydrocarbons
and the Contractor reach the aforesaid reciprocal agreement.


 






    Page 15 of 52


     


    

 


If the Minister and
the Contractor do not reach an agreement regarding the amendments and modifications proposed by the Minister before the end of the Calendar
Year during which the Annual Work Plan and corresponding Annual Budget were submitted, the Contractor shall continue its operations in
accordance with the last Annual Work Plan and corresponding Budget approved by the Minister in charge of Hydrocarbons until a reciprocal
agreement is reached or a decision is made by an expert, if either Party decides to submit the dispute for an expert opinion in accordance
with the provisions of Article 24.2.


 


The exploration and
exploitation periods or as applicable the additional production period shall not include any time spent requesting an expert opinion,
including the time-frame associated with this procedure.


 


		8.3.	Execution of the Oil Operations



 


		8.3.1	For the duration of the Contract, the Contractor shall directly perform the exploration and exploitation
activities in the Contract Region. To better carry out these activities, it shall be authorized to use specialized Sub-contractors. However,
the Contractor shall keep the monitoring and the general accountability of the operations or activities undertaken.



 


		8.3.2	The Contractor must speedily carry out the Oil Operations in accordance with Best Practices, while taking
into account the local conditions as well as other special conditions in the Contract Region.



 


		8.3.1	The Contractor must inform the Minister in advance of all significant and planned Oil Operations such
as geological or geophysical research and the start up of well drilling activities. The Contractor must also inform the Minister in writing
about any drilling suspension or abandonment of wells within twenty four (24) hours.



 


		8.4	Budget Overruns



 


		8.4.1	The Minister in charge of Hydrocarbons and the Contractor acknowledge that the technical results obtained
as work progresses or certain unforeseen situational changes which may occur may justify modifications to an approved Annual Work Programme
and corresponding Budget. As necessary, the Contractor shall inform the Minister in charge of Hydrocarbons of the planned modifications
as soon as possible. These modifications shall be submitted for the review and approval of the Minister within [***] days following
receipt of such notification. If the Minister in charge of Hydrocarbons neither approves or rejects these planned modifications within
this [***]-day period, this failure to act shall be understood as approval of the aforesaid modifications.



 


		8.4.3	If the Contractor reasonably believes that the Annual Budget has been exceeded, the Contractor must notify
the Minister in charge of Hydrocarbons in a timely manner and provide the latter with a detailed and justified description of such overages.



 


		8.4.4	The limits established in Article 8.4 shall not prejudice the right of the Contractor to incur expenses
in case of emergency requiring immediate intervention pursuant to Article 8.5.



 


		8.4.5	Except as indicated otherwise in Article 8.5, if the Contractor incurs an expense for which the programme
and budget have not been approved in the context of an Annual Work Programme and a corresponding Annual Budget or any amendment thereto
approved by the Minister in charge of Hydrocarbons, this expense shall not be recoverable by the Contractor as Oil Costs.



 


		8.5.	Emergency or Accident



 


		8.5.1	In case of emergency or accident requiring immediate intervention, the Contractor shall take all prudent
and necessary measures in accordance with best practices in the oil industry to protect its interests and those of the Government as well
as the property, life and health of other Persons, the environment and the safety of the Oil Operations. The Contractor shall inform the
Minister in charge of Hydrocarbons of this emergency or this accident as quickly as possible.



 


		8.5.2.1	All costs incurred by the Contractor as a result of emergencies shall be recoverable as Oil Costs in accordance
with this Contract. Notwithstanding the foregoing, none of the costs incurred by the Contractor which result from the gross negligence
or wilful misconduct of the Contractor, its subcontractors or any Person acting on their behalf shall not be recovery as Oil Costs.



 






    Page 16 of 52


     


    

 


		8.6	Reports 



 


		8.6.1	In the context of this Contract, the Contractor shall prepare and update all the registers related to
the Oil Operations in the Contract Region.



 


		8.6.2	Subject to its general rights and obligations, the Contractor shall:



 


		a.	Record in original version or reproducible of good quality, or if any, on magnetic recording medium and/or
electronic medium, any geological, geophysical, geochemical or well information and any data related to the Contract Region and acquired
by the Contractor.



 


		b.	Keep all files containing the details related to the following aspects:



 


		i.	Drilling: the work per se, deepening, production tests, closing up or abandonment of wells;



 


		ii.	The geological formations the wells went through;



 


		iii.	Well casings and any modification of the said casings;



 


		iv.	All Hydrocarbons, water and other minerals of economic interest or dangerous substances encountered;



 


		v.	The zones in which geological or geophysical activities were undertaken.



 


		8.6.3	The well logs, maps, magnetic or electronic bands, cores and samples and other geological, geophysical
and geochemical information obtained by the Contractor during the Oil Operations shall be the property of the Government and shall be
turned over to the Government as soon as they are obtained or prepared, although the Contractor shall be entitled to retain copies of
the aforesaid documents and files, subject to compliance with the confidentiality clauses.



 


		8.6.4	In performing its contractual obligations, unless otherwise agreed upon by the Parties, the Contractor
may:



 


		1.	Keep copies of the material that comprise the Data over the duration of the Contract;



 


		2.	Keep for the necessary duration of the Oil Operations, with the approval of the Government, the original
Data, provided that the said Data is reproducible and that copies have been submitted to the Minister in charge of Hydrocarbons;



 


		3.	Export for laboratory treatment, examinations or analyses and for [***], samples and any materials
comprising the oil data, on condition that samples of equivalent size and quality or, when such Data may be reproduced, copies of equivalent
quality are submitted to the Minister.



 


		8.6.5	The Contractor should regularly inform the Minister about the major developments in the context of the
Oil Operations and give him the available information (data, reports, evaluations and interpretations) related to the Oil Operations.



 


Moreover, the Contractor
must:


 


		a)	Establish daily drilling and exploitation reports as part of its activities;



 






    Page 17 of 52


     


    

 


		b)	Prepare and submit to the Minister a monthly production report within a deadline of [***] days
following the end of the month concerned and that shall include a description of the activities covered during the said month;



 


		c)	Prepare and submit to the Minister a quarterly report during the exploration and exploitation period within
a deadline of [***] days following the end of each Calendar Quarter, and that shall include a description of the activities covered
during the said quarter along with the plans and maps showing the sites where the described works have been undertaken.
	 	 	 



		d)	Prepare and submit to the Minister an annual report within [***] months of the end of each Calendar
Year, which integrates and develops the revised quarterly reports if necessary for the Calendar Year in question.
	 	 	 



		e)	All monthly, quarterly and annual exploration and exploitation reports produced by the Contractor shall
be written in French and addressed to the Minister in charge of Hydrocarbons.
	 	 	 



		f)	Failure to product two quarterly activity reports shall be considered a breach of the Contract.



 


		g)	Failure to produce quarterly activity reports for [***] shall be considered as serious misconduct
stemming from deliberate negligence.



 


		h)	At the end of each year, the Contractor shall have [***] days to submit its annual activities and
budget report. If at the end of this period, no report has been received by the Government, notification shall be sent to the Contractor,
who shall have [***] days to make the necessary corrections. After this period, if no positive reaction on the part of the Contractor
is noted, the Contract shall be considered terminated and notice shall be given to the Contractor.









 


ARTICLE 9: DECLARATION OF COMMERCIAL DISCOVERY
AND DESIGNATION OF

THE DEVELOPMENT ZONE


 


		9.1	As soon as a Hydrocarbon Discovery is made in the Contract Region, the Contractor must immediately inform
the Minister and the provisions of this Article shall be applied. After the Hydrocarbon Discovery and within the [***] days following
the said Discovery, the Contractor shall submit to the Minister an initial Discovery report.



 


At the latest in the [***] months
following the Discovery, the Contractor shall submit to the Minister a detailed report on the Discovery, indicating, if necessary, whether
or not this discovery has been evaluated. If the Contractor deems that the Discovery is worth evaluating, the report must include an evaluation
programme and a schedule of activities in order to implement an adequate and effective evaluation. The Contractor must properly complete
the evaluation programme submitted to the Minister during the exploration period in accordance with the evaluation programme and the approved
schedule of activities. Notwithstanding all of the provisions of Article 9, provided that the Contractor has fulfilled its obligation
to drill exploration wells as indicated in Article 6, it shall be entitled to receive a Development Zone which includes the predefined
Development Zone.


 


		9.2	At the latest [***] days following the end of the evaluation programme, the Contractor must submit
for the assessment of the Minister a detailed evaluation report justifying the commercial viability of the proposed Development Zone.
This report must include:



 


		-	The description of the Development Zone, namely the structural configuration, the physical properties
and the span of the reservoir rocks, the surface areas, the layer and the depth of the productive zones;
	 	 	 



		-	An estimation of the initial oil reserves and gas that can be recovered, the characteristics of the recuperation,
the expected yield of production per reservoir;



 


		-	An estimate of the number of necessary wells for an efficient drainage of the reserves, the characteristics
of the fluids present, in the case of the Crude Oil its density, the sulphur, sediment and water content, as well as the yield characteristics
of the product;
	 	 	 



		-	The expected economic projections and cash flow.



 






    Page 18 of 52


     


    

 


		9.3	The Contractor should declare in the report if it deems that the Discovery is commercially viable, and
in this case it shall have the right to develop it and produce the Hydrocarbons in accordance with the provisions of this Contract. However,
the Minister shall support as much as possible the establishment of non-existent facilities for the production and testing of all early
production wells. This Government support shall include, if possible, assistance to obtain and access existing installations or obtain
the necessary onshore land in the immediate vicinity of the pipeline.



 


		9.4	In the [***] days following the presentation of the report in which the Contractor shall communicate
to the Minister its opinion that its Discovery is commercially viable, the latter shall notify in writing the Contractor of his approval
and the date of approval of the Minister shall be the “Commercial Discovery Date”. If at the end of this deadline of [***]
days, the Minister does not notify in writing the approval mentioned, the Commercial Discovery Date shall be the date following the deadline
of the [***] days mentioned above. The Minister shall then grant the Contractor the exploitation permit if it applies for it.



 


		9.5	If the Contractor deems that the Discovery is not commercially viable, it should communicate to the Minister
the reasons for its decision. If the Minister questions the basis of the technical or economic analysis of the Contractor on the non commercial
character of the Discovery, or if for any other reason he deems that the Discovery could be developed economically by the Contractor in
accordance with the clauses and conditions of the Contract, then the Minister should, in the [***] days if he wishes, submit the
question of the commercial viability to an expert in compliance with the Contract. If the Expert confirms that the Discovery is a commercial
one, the Contractor may, in the [***] days following the date of receipt of the decision of the Expert, declare that the Discovery
is a Commercial Discovery in accordance with the provisions of the Contract and the date of declaration shall become the Commercial Discovery
Date. In this case, the Minister shall have the right to develop the Discovery Zone and produce Hydrocarbons in accordance with the provisions
related to exclusive-risk operations. The Contract shall remain valid for the remaining part of the Contract Region.



 


		9.6	In the [***] days following the Commercial Discovery Date, the Contractor should submit to the
Minister a General Development Programme indicating:



 


[***]


 


		9.7	The General Development Programme proposed by the Contractor shall be prepared in compliance with engineering
principles, economy principles and Best Practices. It must also be designed with a view to ensuring the optimal recuperation of Hydrocarbons
in the Development Zone and to prevent wasting them.



 


		9.8	The General Development Programme of the Contractor may be revised by the Minister who shall give his
approval if he deems that it has been prepared in compliance with the provisions above. If the Minister deems that the General Development
Programme presented by the Contractor was not prepared in accordance with those provisions, he shall propose amendments and the Contractor
may, in response, modify it. If within the [***] days following the date of presentation of the Programme, the Minister and the
Contractor do not reach an agreement with regard to the said Programme, the matters on which they disagree must be submitted to an expert
who shall take a decision. In case of disagreement and resorting to an expert, the exploitation period of [***] shall not include
the time used to call for an expert (including the time for the appeal procedure).



 


		9.9	During the Development and Production Operations, the Contractor may propose additions or revisions to
the General Development Programme. It must then submit them to the Minister for consideration and approval, in accordance with the procedures
contained in clause 9.8 if within [***] days of the date of submission of the additions or revisions to the General Development
Programme, the Minister and the Contractor do not reach an agreement with regard to the aforesaid additions and revisions, the matter
or matters on which they disagree must be submitted to an expert, pursuant to the procedure specified in clause 9.8, and the [***]
exploitation period shall not take into account the period of this procedure.



 


		9.10	If the Contractor wishes to finance the Development Operations with funds coming from banks or other funding
sources, the Minister shall support the Contractor by supplying all information that the banks or funding sources may reasonably require,
provided that the Minister does not assume any additional obligations of any kind to that effect, financial or otherwise.



 




    Page 19 of 52


     


    

 


ARTICLE 10: EXCLUSIVE RISKY OPERATIONS


 


		10.1	In case the Minister, during the exploitation period, wishes to test additional reservoirs of a well at
the agreed level, or deepen the well and test the reservoirs that are deeper than that final level, the Government shall have the right,
subject to the stipulations provided in Clause 10.4, to ask by notification to the Contractor to test some additional reservoirs or to
continue drilling and to test some new reservoirs, at the exclusive risks of the Government. The Government shall notify the Contractor
as soon as possible before or during drilling, but in no case after the Contractor has started the completion or abandonment activities
of the well.



 


		10.2	If during the exploration period, the Parties do not agree on the Government recommendation to drill additional
exploitation wells, the Minister shall have the right, after the initial period, to ask the Contractor to drill in the Contract Region
at the exclusive risks and cost of the Government one (1) exploitation well provided that this Operation does not delay, hamper or disturb
the exploitation and evaluation activities of the Contractor. In that case, the Minister shall have a maximum deadline of [***]
months to submit to the Contractor a report on establishing the said well specifying the drilling details as well as the financial plan
of the operation he is pre-financing.



 


		10.3	If the operations described in clauses 9.3, 10.1 or 10.2 lead to a Discovery or a Commercial Discovery,
the Government shall have the right, at its exclusive expenses, risks and benefits, to appreciate the said Discovery and/or to develop
and produce oil from the reservoir corresponding to that Discovery. The Contractor shall notify in writing to the Minister, before starting
the commercial production of the oil reservoir discovered in the context of the said exclusive-risk operations, if it wishes to support
future operations for the development and/or production of the said oil reservoir, in compliance with the terms of this Contract. In that
case, the Contractor shall pay in cash or in kind to the Government in addition to [***] of the exploitation costs and, if any,
capital exploitation costs incurred by the Government in the context of the exclusive-risk operations and corresponding to the discovered
oil reservoir, an additional amount equalling [***] of the said exploitation and capital costs.



 


		10.4	The conditions to undertake exclusive-risk operations shall be the following:



 


		(a)	The production tests of additional layers or the penetration and the production tests of deeper layers
or drilling additional exploration wells, must be technically feasible;



 


		(b)	Deepening a well as part of exclusive-risk operations may not take place when the well has already gone
through producing reservoirs;



 


		(c)	No exclusive-risk exploration well shall be drilled in an exploitation zone, nor on the site of a Commercial
Discovery;



 


		(d)	The Minister may hire a third party to undertake the exclusive-risk operations referred to above. However,
the Minister shall not recruit a third party to these ends without having previously offered to the Contractor the right of pre-emption
for the execution in its name the said exclusive-risk operations in conditions similar to those which should be acceptable to that third
party. In case the Contractor does not accept to undertake those operations notified by the Minister, the latter shall have the liberty
to hire the third party provided that this third party respects the conditionality clauses related to the reports, data and information
kept or prepared by the Contractor and received by that third party as part of this article or Article 9 and in accordance with Article
21.



 





    Page 20 of 52


     


    

 


ARTICLE 11: GOVERNMENT PARTICIPATION


 


		11.1	The Government has the option to acquire a maximum interest of [***] in the rights and obligations
of the Contractor regarding a commercial discovery.



 


		11.2	The Government must exercise its participation option by written notification to the Contractor within
the [***] days following the date of commercial declaration by the Contractor. For lack of submitting a written notification during
this deadline of [***] days, the option shall be considered as denied.



 


		11.3	If the Government exercises its option of participation in accordance with Article 11.1, the Contractor
shall give up to the Government the share claimed. To this effect, the Contractor shall propose a draft convention to the Minister in
charge of Hydrocarbons for consideration. This convention shall specify the terms of the Government’s participation.



 


		11.4	The Government participation shall be effective from the date of receipt by the Contractor of the written
notification set out in article 11.2.



 


		11.5	If the Government exercises its participation option, the Minister shall enter into an operational agreement
with the Contractor in accordance with the standards of International Oil Operations, which shall govern the rights and obligations of
the Parties.











 


ARTICLE 12: ROYALTIES, COST RECOVERY &
PRODUCTION SHARING


 


ROYALTIES


 


		12.1	The Contractor shall pay royalties to the Government at a rate of [***] of the total
                                                                    available production excluding losses regarding the Oil Operations for oil starting with the first barrels produced. The remaining
                                                                    quantity of the crude oil shall be referred to as ’‘Available Crude’’. This rate is negotiable for the
                                                                    condensate In case of discovery of gas, both Parties shall
come together to define the royalties as well as the sharing proportion for the gas.



 


RECOVERY OF OIL COSTS


 


		12.2	After deducting the Royalties, the exploiting Contractor shall be entitled to a maximum of [***]
of the remaining Total Available Production of Crude Oil for the oil every Calendar Year as the recovery of Oil Costs (Oil Costs Recovery
Share).



 


		12.3	Subject to the provisions related to participation, the Contractor shall assume and pay all Oil Costs
incurred in executing the Oil Operations and shall recover the said costs according to the modalities defined in the Accounting Appendix
D.



 


		12.4	The costs directly attributable to the development and production of non-associated Gas shall be the subject
matter of a specific agreement in accordance with the provisions of this Contract.



 


The costs shall be recovered
as follows:


 


[***]


 


		12.5	When the recoverable Oil Costs of a given Year exceed the value of the Crude Cost Recovery (“Cost–Oil”)
available that year, the recovery of the surplus shall be carried forward to the following Years.



 






    Page 21 of 52


     


    

 


SHARING OF OIL PROFITS


 


		12.6	Every Year, the remaining Available Crude after deducting the recoverable Oil Costs called hereinafter
“Oil Profit’’ or “Crude-Profit’’ shall be shared between the Government and the Contractor
according to the percentages below:



 


		a)	For oil 



 


[***]


 


After recovery of the oil costs, the Parties shall
come together to define a new sharing formula


 


		b)	For the condensate (to be negotiated in case of discovery)



 


		12.7	The Parties shall agree that if the Profitable Limit of a deposit is going to be reached, (that is if
the Oil Costs incurred by the Contractor exceed the oil monetary flow received from selling the production in such a way that it leads
to stopping prematurely the production of this deposit), they shall consult each other and examine the amendments to be made to the provisions
of this Contract, namely cost recovery and production-sharing in order to extend the life of the deposit.









 


ARTICLE 13: MEETING THE NATIONAL CONSUMPTION
NEEDS


 


		13.1	Following the start-up of the Production Operations, the Government shall have the right to purchase and
the Contractor the obligation to sell, in a determined Delivery Point, an equivalent volume of Hydrocarbons in the form of Crude or refined
products or equivalent gas as agreed upon between the Parties, equivalent to a maximum of [***] of the share of the Oil Profit
accruing to the Contractor in order to meet Benin’s internal demand. The transfer of the Oil shall be done in this context in accordance
with the provisions of clause 15.5.



 


		13.2	If in a deadline that shall not exceed [***] days from the Hydrocarbons delivery date, the Government
does not pay the bill, the Contractor may request to be paid by deduction from the Oil Profit of the Government.



 


		13.3	With regard to the Crude Oil, the obligation for the Contractor to sell shall be based on the principle
according to which all Crude Oil producers or exporters in Benin, including the Government, shall bring at any moment and proportionally
a portion of their production to meet the national consumption needs. To take advantage of his acquisition rights, the Minister should
give a written notice of [***] months to the Contractor, indicating the volume of the Crude Oil of the Oil Profit of the Contractor
that shall be acquired during the [***] calendar months following the above-mentioned notice. The monthly variation of that volume
shall not exceed a margin of more or less than [***].



 




		13.4	If in case of Force Majeure, other contractors or the Government are not able to contribute proportionally
to meeting the national needs, and if as a consequence the volume of participation of the Contractor and other contractors to the national
market demand must be increased, the Contractor shall sell the required additional quantities in accordance with the above-mentioned clauses
and conditions until the case of force majeure is resolved and until the contribution meant to cover proportionally the national market
demand is re-established. This additional obligation shall not include the volumes of production that are already the subject-matter of
an exportation contract, the loading period of which is fixed within the [***] working days following the date on which the Contractor
receives the notification of the Minister related to the case of force majeure.



 


		13.5	With regard to the Natural Gas, the obligation of the Contractor to sell must be established by taking
into account the criteria used to meet the national market demand stipulated above and by taking into account a Natural Gas price determined
in accordance with this Contract.



 


		13.6	All payments made as part of the Contractor’s Hydrocarbons sales to the Government in accordance with
the provisions of this Article must be in dollars and through bank transfer in favour of the bank account designated by the Contractor
outside Benin in a deadline of [***] days from the date of delivery to the Delivery Point of the Hydrocarbons purchased by the
Government.



 






    Page 22 of 52


     


    

 


ARTICLE 14: APPLICABLE
TAX SYSTEM


 


		14.1	Over the life of the Contract and in accordance with the legislation in force in the Republic of Benin,
the Contractor shall be subject to the tax system commonly applied to enterprises in general and to oil activities in particular.



 


		14.2	The Contractor shall be bound to pay in accordance with the Benin Tax Code all of the taxes and dues to
which he shall be subject namely the Income Tax, which shall not exceed [***] of the taxable profit.



 


		14.3	It shall be understood that pursuant to Article 14.2, the Minister shall ask to deduct from the Oil Profit
of the Government under article 12.6, an amount corresponding to the Income Tax and to the Export Tax provided for in the Oil Code. He
shall request that to this effect the said tax be paid on behalf of the Contractor and issue to him the related receipts. The same shall
apply to the Export Tax. In that case, the portion of the Oil Profit belonging to the Contractor as set out in article 12.6 shall be considered
net of tax and shall not be subject to any tax whatsoever. In other words, the Contractor shall be free of all tax obligations that are,
by definition, included in the Oil Profit received by the Government and in the Tax on Oil Production also received by the Government.



 


The Minister shall send the receipts
by official correspondence justifying the payment of the taxes, duties and dues to which the Contractor is subject.


 


		14.4	The Contractor, its sub-contractors and service providers shall be exempt from the charges and customs
duties, including Road Tax, on the capital equipment, products, exploitation and exploration materials and drilling machines and equipment
(including the Rig or the drillship and all similar equipment), the platforms and production installations and spare parts imported in
the context of the Oil Operations.



 


However, the goods, products, equipment,
exploration and exploitation materials and all drilling machines and equipments (including the Rig or the drillship and all similar equipment),
the platforms and production installations and spare parts likely to be re-exported at the end of their use shall be subject to the exceptional
temporary admission system in accordance with current the provisions governing this matter.


 



    Page 23 of 52


     


    

 


		14.5	The Contractor, its subcontractors and its service providers are also exempt from taxes, duties and indirect
dues, including the Value-Added Tax (VAT) with regard to the oil exploration and exploitation activities and all other related activities.



 


The Contractor, its subcontractors
and its non-resident service providers are also exempt, with regard to the oil exploration and exploitation activities and all other related
activities, from:


 


[***]


 


		14.6	Expatriate personnel employed by the Contractor, its subcontractors and service providers benefit from:



 


[***]


 


One vehicle per household may also
be imported in temporary admission.


 


		14.7	The Government shall be ready to consider any amendment to the tax clauses that the Contractor may ask
at any time, provided that:



 


(a) Such modifications do not
have a negative incidence on the overall economic gains and other benefits that the Government shall draw from the Operations; and


 


(b) The only reason for proposing
such modifications shall be to allow any person making the Contractor or to any other Affiliated Company to obtain in another country
a tax credit related to the paid taxes in the Republic of Benin.


 


		14.8	The Contractor shall be bound to pay to the Government the revenues as part of duties and taxes provided
in this Contract through a national structure. The designation of the national structure in question shall take place within the [***]
days following the Effective Date.



 


		14.9	The Government shall issue within the [***] days following the payment date a receipt in the name
of the Contractor relating to the said payment.



 



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ARTICLE 15: MEASUREMENT, PROVISION, EVALUATION
AND SALE OF HYDROCARBONS


 


		15.1	The Contractor must measure all Crude Oil and Natural Gas produced in the Contract Region in accordance
with Best Practices. The Contractor must keep complete and precise registers of all measurements of the Hydrocarbons produced in the Contract
Region after extracting the water and its foreign bodies, then all tradable Hydrocarbons; that shall allow calculating the difference
to determine the quantities used for the Operations and the unavoidable losses. The representatives of the Minister must have access to
these registers and measures.



 


		15.2	The Minister shall have the right to test all measures, measuring equipment, the graphs and any other
measuring or testing and information material.



 


		15.3	If, following an examination or a test, it appears that the measuring equipment is not functioning, that
they are damaged or incorrectly set, the Contractor must fix them or do the necessary adjustments immediately and meet the costs.



 


		15.4	If within a reasonable deadline that shall not exceed [***] days the Contractor does not assume
that obligation, the Minister may take the appropriate measures to make the said equipment operational or adjusted and may bill the Contractor
for the cost of that operation at the interest rate of the Contract plus [***]. If, according to the Minister, the error caused
by the bad adjustment or any other fault of measuring equipment seems to be the reason of big difference in measuring the production,
the Parties shall consult each other to take the appropriate measures. In case of disagreement, the question may be submitted to an expert
who shall determine if it is appropriate to do a retroactive adjustment of the production figures. If the Contractor considers that it
is necessary to replace some measuring devices or instruments, it must inform the Minister for approval and give to the representatives
of the Minister the chance to be present during the operation and to take part in it.



 


		15.5	In the context of this Contract, the price of the Crude Oil for each quarter shall be the weighted average
FOB prices received by the Contractor for selling to third parties different from the Parties during the corresponding quarter.



 






    Page 25 of 52


     


    

 


		15.6	If in a given quarter the Contractor does not sell at least [***] of the total Crude Oil production
of the Contract Region to third parties different from the Parties, the price of the Crude Oil for that quarter shall be the weighted
average of FOB prices fixed in comparison with the price of the Crude Oil on the international market in view of the quality, density
and transport differentials.



 


		15.7	In case of lack of an agreement between the parties within the [***] days following the end of
the Quarter involved, awaiting the opinion of an expert, the agreed selling price for the preceding Quarter shall apply provisionally
subject to the retroactive adjustments that could be necessary after the expertise. Resorting to an expert provided in this article shall
apply in a deadline that shall not exceed [***] days after the end of the Quarter involved.



 


		15.8	In the context of this Contract, the price of the Natural Gas sold in the Benin national market shall
be the price received by the Contractor for selling to third parties. Taking into account the fact that in Benin the gas market is not
highly developed, the Government should assist the Contractor if possible to find possible gas consumers and to negotiate reasonable selling
prices. The price of Natural Gas applicable to the gas sold to a Benin public enterprise or to an organization which social capital and
voting right is the direct or indirect property of the Government, shall be agreed upon by the Parties, since this price should reflect
the commercial value of the source of energy that the sold gas is supposed to replace, in accordance with the modern technology generally
used and by taking into account the cost of the produced gas. The price applicable to Natural Gas exportation shall be the price received
by the Contractor in the context of selling to third parties, subject to the same conditions governing normally selling Crude Oil.



 


		15.9	The Contractor shall have the right to possess, load, transport and export freely the Hydrocarbons that
belong to it by virtue of the Contract. The Minister may ask the Contractor to sell all or part of the oil belonging to the Government
in accordance with article 12 and in the market conditions set out in Article 15.5, provided that the Parties have agreed on the provisions
relating to commercialization.



 


		15.10	At the latest [***] days before the Commercial Production starts in each Development Zone, and
afterwards at the beginning of each Quarter, the Contractor must prepare and submit to the Minister a prevision indicating the total quantity
of Hydrocarbons that, according to it, will be produced during the next [***] Quarters in the corresponding Development Zone, from
a production rate determined by mutual agreement to optimise the recuperation of the Hydrocarbons in the Development Zone in accordance
with Best Practices. Each Quarter, the Contractor must make reasonable efforts to produce the quantity of Hydrocarbons it has planned
to produce. The Contractor shall be authorized to use, free of charge, the quantities of Hydrocarbons produced in the Contract Region,
at the natural state or treated, necessary to undertake the Oil Operations (including Operations to load the Gas) in accordance with Best
Practices. Regardless of the quantity of Hydrocarbons used for this purpose, they shall not be considered part of the Commercial Production.



 



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ARTICLE 16: NATURAL GAS


 


		16.1	The Benin national market enjoys a preferential acquisition right of the Natural Gas produced in any Development
Zone and not used for Oil Operations in accordance with this Article, provided that the commercial proposals offered are not less favourable
than those in which the gas in question may be exported. Natural Gas not sold on the national market may be exported.



 


		16.2	In case of a discovery of a commercial gas accumulation, a gas purchase contract (a “Take or Pay”
Contract) should be discussed between the Government and the Contractor in the shortest deadline. In case the direct generation of energy
seems to be more profitable for both Parties, they shall meet to fix the conditions.



 


Associated Natural Gas


 


		16.3	In case of a Crude Oil Discovery that the Contractor deems commercially viable in accordance with this
Contract and that the Discovery contains Associated Gas, the Contractor should indicate in its evaluation report if it considers that
the estimated production of Associated Gas will exceed the quantities of Associated Gas required for the additional Production Operations
and if the declared surplus Associated Gas can be produced in commercial quantities. If the Contractor declares that this Associated Gas
does exist and can be produced in commercial quantities, it shall indicate in the General Development Programme prepared for the Hydrocarbon
Discovery, the details related to the collection, treatment, compression and transportation installations required to exploit the surplus
Associated Gas for commercialization as well as the related costs.



 


		16.4	Within [***] days following the date of presentation of the General Development Programme, the
Minister may notify to the Contractor that either he or any other Benin public enterprise designated by him would like to have the surplus
Associated Gas on the national market.



 


		16.5	If the Contractor decides to participate in accordance with the above-mentioned provisions:



 


		(a)	it shall build collection, treatment, compression, transport and storage facilities required for the production
and delivery to the Delivery Point of the surplus Associated Gas in accordance with the specifications of the General Development Programme;



 


		(b)	The price of the Associated Natural Gas shall be the price of the Natural Gas determined in accordance
with this Contract.



 


		16.6	If the Contractor decides not to participate, it must deliver to the Minister, or to the Benin public
enterprise designated to that effect by the Minister, in a delivery point designated as an “exit port”, and at its own expense,
which shall be considered as recoverable costs, all produced surplus quantities of Associated Gas produced.



 






    Page 27 of 52


     


    

 


		16.7	Subject to the provisions related to environmental protection, the Contractor may burn all unused surplus
Associated Gas.



 


Non-Associated Gas


 


		16.8	In case of a Discovery of Non-Associated Gas in the Contract Region, the Contractor must present a report
in accordance with the prescriptions of this Contract. If the Contractor considers that the Discovery is worth evaluating, it must evaluate,
with an estimation of the reserves, the production potential, as well as the economic viability. In that report, the Contractor should
also declare if the Discovery is commercially viable. If the Contractor considers that the Discovery of the Non-Associated Gas is not
worth evaluating, the provisions related to the Crude Oil shall be applied mutatis mutandis.



 


		16.9	If the Contractor considers that the Discovery can be commercially viable, the Minister shall assist it
in evaluating the demand for gas on the national market as well as in the transformation and commercialisation activities required to
distribute it to end-users of the said market. At the same time, the Contractor shall be free to assess the viability of the exportation
of the Gas. Within the Calendar Year that follows the date of presentation of the detailed evaluation report of the Contractor, the parties
should meet to decide if the outlets and the other factors justify its development and production for the national market and/or if it
is considered that this market is not sufficiently big and that the Gas should be exported.



 


		16.10	If the Contractor considers that the development of the Non-Associated Gas Discovery is justified, it
must present to the Minister a General Development Programme of the said Discovery and the provisions related to the commercial discovery
and those to the Government participation shall be applicable to the development and production of the said Gas as in the case of Crude
Oil. If the Contractor considers that the Discovery of Non-Associated Gas is not justified, then the provisions related to Crude Oil shall
be applied mutatis mutandis to the development and production of the said Gas.



 


		16.11	If it is determined that the Discovery of the Non-Associated Gas cannot be used on the national market
while the Contractor considers that the Discovery of the Non-Associated Gas could be commercially viable for exportation, the Contractor
shall have all the liberty to develop the Gas Deposit provided it presents to the Minister a General Development Programme. If the Contractor
starts the Development Operations for exportation, the Minister shall take all necessary provisions to ease the construction of the appropriate
facilities. Provisions related to the Commercial Discovery and to the Government participation shall be applicable mutatis mutandis to
the development and production of the said Non-Associated Gas as in the case of Crude Oil. Once the Contractor has started the Development
Operations for exportation, the right given to the Contractor to export by virtue of this Article shall remain in force during the whole
period.



 


		16.12	In the context of this Contract, the price of the Non-Associated Gas produced by a Gas Deposit meant to
be used in Benin shall correspond to the price of the Natural Gas determined in accordance with the provisions of this Contract.



 


		16.13	In accordance with security norms and environmental protection, the Contractor shall have the right, after
approval by the Minister, to build gas separation facilities in order to produce liquid gas and condensate.



 






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ARTICLE 17: DAMAGES, ABANDONMENT, ENVIRONMENTAL
PROTECTION AND SECURITY


 


		17.1	[***]



 


		17.2	The Parties recognize that by their nature, the Oil Operations may produce an ecological imbalance in
the Contract Region because of environmental pollution. Therefore, by implementing the Contract, the Contractor must adopt the necessary
measures to prevent or minimize soil, atmosphere and water pollution, and take care so that the pollution will not harm the flora or the
fauna and, in general, prevent any thing that could materially damage the environment. If the Contractor cannot prevent environmental
pollution in accordance with the Constitution and Environmental Framework Act of Benin, it should take the appropriate measures to minimize
its effects in accordance with the international norms. These measures must be communicated to the Minister for approval.



 


		17.3	To minimize or eliminate pollution, the Contractor must use appropriate technical measures approved by
the Minister.



 


		17.4	[***].



 


		17.5	The Contractor shall commit himself/herself to call for specialists in the field to study the possible
incidence of Oil Operations on the environment. That study should be on:



 


		(a)	The state of the environment and the existing pollution level in the Contract Region and the neighbouring
regions before the Oil Operations;



 


		(b)	The incidence that the Oil Operations may have on that environment.



 


The study mentioned in paragraph (a)
must be carried out in two phases:


 


		(1)	A preliminary study submitted by the Contractor to the Minister before the seismic survey of the Contract
Region and



 


		(2)	The definitive study applicable to all the exploration period and that should be presented to the Minister
before drilling the first well. The study mentioned in paragraph (b) must be carried out and submitted to the Minister at least [***]
days before drilling the said wells.



 


		17.6	The above-mentioned studies should include the measures used to eliminate or minimize, among others, the
hereunder mentioned wastes as well as the way to neutralize them:



 


		(a)	Drilling mud and Hydrocarbons from the tests, completion, conditioning and abandonment of wells;



 


		(b)	Solvents, lubricants and other products used during the operations;



 


		(c)	Organic waste, rubbish and unusable products in the workplaces and camps.



 






    Page 29 of 52


     


    

 


		17.7	The Contractor must conceive and build its facilities and endeavour to minimize the environmental pollution
and adopt, among others, the following measures on the drilling and exploitation equipment sites:



 


		(a)	Drainage systems/recuperation of overflowing Crude Oil and other derivatives and polluted waters;



 


		(b)	Waste management system.



 


		17.8	The Contractor shall commit himself/herself to include the provisions of this Article in all contracts
negotiated with third parties and related to the Oil Operations.



 


		17.9	If the Contractor does not comply with the provisions of this Article and the Crude Oil or any other product
overflows into the soil, the sea floor or into the sea, or if the activities of the Contractor cause another form of pollution or, in
any other way, contaminate water supply points or plant or animal life, the Contractor should immediately take all appropriate measures
consistent with Best Practices to control the pollution, clean all overflowing Crude Oil or any other product, or fix as completely as
possible any damage caused.



 


		17.10	If, as a direct consequence of gross or deliberate negligence of the Contractor, there is an overflowing
or a pollution, the cost of the activities to control, clean and repair shall be supported by the Contractor and shall not be considered
as Oil Costs in accordance with this Contract.



 


		17.11	In case of a danger likely to affect the environment, the Contractor should immediately notify it to the
Minister and take the measures set out in the emergency measures adopted by the Parties in compliance with Best Practices.



 


		17.12	At any time, the Contractor may return or abandon any part of the Contractual Zone or any Well not included
in a Field, subject to prior notice of [***] months to the Minister in charge of Hydrocarbons, provided that the Contractor has
fulfilled all of its obligations pursuant to this Contract and has provided the Minister with detailed information on the status of any
Deposit and the facilities and equipment located in this zone, in addition to any plan for the removal or dismantling of these facilities
and equipment, including all technical and financial information. All abandonment operations must be carried out in accordance with the
Law on Hydrocarbons.



 


		17.13	The abandonment of a Field by the Contractor and the corresponding abandonment plant shall require the
prior approval of the Minister in charge of Hydrocarbons in accordance with the Law on Hydrocarbons. The Contractor shall prepare and
submit to the Minister an abandonment plan for all Wells, facilities and equipment, the restoration of the land and the continuation of
the Oil Operations, as applicable, in accordance with the Law on Hydrocarbons.



 


		17.14	Unless the Minister in charge of Hydrocarbons decides to retain the facilities and equipment in order
to continue the Oil Operations in accordance with Article 17.17, the Contractor shall be obligated to fully abandon all of the Fields
of the Contractual Zone before the end of the Exploration Period or any Extension Period, as applicable.



 


		17.15	Upon receipt by the Minister of the notification indicated in Article 17.12 or the abandonment of any
Field, the Minister shall be entitled to resume any Discovery or any Field which the Contractor intends to abandon. If the Minister does
not communicate its intention to resume the Oil Operations within [***] following receipt of the relevant notification, he shall
be considered to have decided not to do so.



 






    Page 30 of 52


     


    

 


		17.16	In order to proceed with the abandonment of a Field, the Contractor shall contribute amounts to a Reserve
Fund consistent with the estimated costs of the abandonment in accordance with the approved abandonment plan. The implementation period
as well as the method of payment of the Reserve Fund shall be defined by mutual agreement between the Minister and the Contractor.



 


		17.17	If the Minister chooses to retain the facilities and equipment to continue the Oil Operations after the
departure of the Contractor, the Reserve Fund thus established and the interests associated therewith shall be provided to the Minister
to cover the subsequent abandonment. The Contractor shall be released for any other abandonment obligation regarding these facilities
and equipment.



 


		17.18	The Contractor must take the necessary measures in accordance with Best Practices to properly and safely
carry out the activities provided for in the Contract and must comply with the legal and regulatory provisions of Benin, including regulations
concerning labour, environmental protection, health and safety. The Contractor must refrain from any action that endangers the health
or safety of persons.



 


		17.19	The Minister shall have the right to inspect all sites, buildings and installations in the Contract Region.
To have access to the sites, the Minister must inform the Contractor in advance.



 


		17.20	The Contractor should see to the safe and effective treatment of the water and residual oil and to the
plugging of the wells before abandoning them.



 


		17.21	The Contractor should cement and abandon all production wells in accordance with common oil practices,
when they stop producing within the Bloc.



 


		17.22	The Contractor should dismantle and remove in accordance with the procedure of abandonment in the Appendix
all the platforms it may have installed in the Contract Region.



 


		17.23	The Contractor should rehabilitate the site in agreement with the Government at the end of the Contract
or when the production of the Bloc stops (see provisional budget for site rehabilitation and consideration of the environmental factor).
Dismantling, removing or abandoning the installations put up by the Contractor shall be done in compliance with the norms of the oil industry
commonly respected in the Gulf of Mexico. On the contrary, the submarine installations or others should be in such a state as to ensure
that they shall not be an obstacle to navigation.



 


		17.24	The Contractor shall leave all pipelines and installations free of oil at the end of the Contract in accordance
with common oil practices.



 


		17.25	The Government shall explicitly agree that the Contractor shall not have any responsibility for abandonment
or environmental rehabilitation other than the one explicitly stipulated in this Contract.



 


		17.26	Any amendment to this agreement on abandonment shall be agreed upon by both Parties.



 


		17.27	In case some laws or regulations in force related to the environment on the date of signature of the Contract
change in such a way that they modify noticeably the economic balance of the Contract, the Parties shall refer to the provisions of Article
27.2.



 






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ARTICLE 18: FOREIGN EXCHANGE ARRANGEMENTS


 


In the context of the regulations in force in
Benin, the Minister shall guarantee that during the life of the Contract, the Contractor and non-Beninese sub-contractors shall be authorized
to:


 


		(a)	Pay in foreign currency, totally or partially, salaries, reimbursements and other compensations;



 


		(b)	Open,
                                            keep and use bank accounts in foreign currency in the Republic of Benin and abroad and accounts
                                            in local currency in the Republic of Benin;



 


		(c)	Pay
                                            directly abroad, in foreign currency, foreign sub-contractors for the acquisition of capital
                                            goods and services related to the Oil Operations;



 


		(d)	Receive,
                                            transfer and keep abroad and posses freely all funds including, among others, all payments
                                            received for the exportation of Hydrocarbons and all payments received from the Government;



 


		(e)	Obtain
                                            from abroad all loans necessary for the Oil Operations;



 


		(f)	Purchase
                                            the local currencies necessary for the Oil Operations and convert into foreign currency all
                                            local currencies exceeding immediate local needs in the certified banks or exchange offices;



 


		(g)	Transfer
                                            abroad all foreign currencies exceeding the local needs of the Contractor. The rights given
                                            to the Contractor and to the Sub-contractors in this Article shall also be applicable
                                            to their foreign employees.



 






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ARTICLE 19: LOCAL CONTENT, SOCIAL PROGRAMMES
AND SIGNING BONUS


 


PRIORITY GIVEN TO BENINESE COMPANIES


 


		19.1	With regard to selecting Sub-contractors to carry out the Oil Operations, the Contractor must give preference
to Beninese Sub-contractors to the extent that they are competitive as far as quality, cost and technical capacity to carry out the activities
within the established activity schedules.



 


EMPLOYMENT AND TRAINING


 


		19.2	Starting from the effective date, the Contractor shall give hiring priority to Beninese personnel possessing
the adequate qualifications at all levels of its organisation in accordance with Labour Legislation in the Republic of Benin.



 


		19.3	According to the employees’ skills, the contractor shall train or contribute to the training of said personnel
to enable them to acquire the necessary qualifications for any position related to the Oil Operations. Using expatriate personnel is subject
to prior authorisation of the Minister in charge of Hydrocarbons.



 


		19.4	Within [***] months following the Effective Date of the Contract, the Contractor must notify the
Minister of the allocation of an annual amount equal to [***], which must be spent by the Contractor during the Exploration Phase
for the training of the Minister’s oil sector officials.



 


		19.5	The aforesaid costs shall be recoverable as Oil Costs in accordance with
the provisions of this Contract.



 


		19.6	The unused training funds shall be paid to the Government upon termination or expiration of the Contract.



 


SUPPORT FUND FOR THE PROMOTION OF THE HYDROCARBON
SECTOR


 


		19.7	The Government shall define and implement the oil activities promotion policy through the support fund
for the Hydrocarbon sector.



 


		19.8	The Contractor agrees to contribute to this fund with an annual donation of [***]. However, it
may directly finance a promotion activity selected by the Minister in charge of Hydrocarbons using this fund.



 


COMMUNITY DEVELOPMENT FUND


 


		19.9	The Contractor shall be willing to contribute to the development of Benin communities through funding
community development projects that the Government shall submit to it. For this purpose, it must provide annual notification of its annual
donation of [***] for the exploratory phase.



 


		19.10	The unused portion of the community development fund shall be paid to the Government upon termination
or expiration of the Contract.



 


		19.11	The three funds will be renegotiated for the production phase.



 


SIGNING BONUS


 


		19.12	The company ELEPHANT OIL LTD has endorsed the airborne radiometric, magnetic and gravimetric surveys performed
by FUGRO for an amount of [***].



 






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ARTICLE 20: ACCOUNTING


 


		20.1	The Contractor must keep accounting records, as well as all financial information, books and records concerning
the Oil Operations in national currency in the form required by the applicable Beninese Legislation.



 


		20.2	Accounting procedures to be applied by the Contractor shall be those set out in the Accounting Appendix
D.



 


		20.3	The audited accounts of the Contractor must be submitted to the Minister for approval at the latest [***]
months following the end of the Calendar Year.



 


		20.4	The Minister may, by giving a notice to the Contractor, at the latest [***] months following the
submission date of the financial accounts, submit all the financial accounts of the Contractor relating to the Calendar Year in question
to be audited by an international firm of chartered accountants designated by both parties. The Government shall bear the costs of that
audit.



 


		20.5	Unless the Parties reach a mutual agreement, the Minister may submit all objections related to the accounts
of the Contractor to an expert decision. Before deciding on an objection submitted, the expert must take into consideration the results
of the financial audits carried out in accordance with the provisions of this Article. If the objection of the Minister is not submitted
to an expert within the [***] months following his receipt of the accounts, the objection in question shall be null and void. If
the objection of the Minister is validated by the expert, the Contractor must rectify the accounts in question and meet the costs related
to the audit and expertise irrespective of the provisions above.



 






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ARTICLE 21: CONFIDENTIAL NATURE OF THE DATA


 


		21.1	All reports, data and information obtained or prepared by the Contractor, inasmuch as they relate to all
or part of the Contract Region, shall be the entire property of the Beninese Government and shall be treated confidentially. Each party
shall promise not to disclose them without first informing the other Party to:



 


		(a)	An affiliated company or a Sub-contractor of the Contractor;



 


		(b)	A
                                            financial institution for the purposes of a loan, a broker, or a legal or financial adviser;



 


		(c)	A
                                            stock market;



 


		(d)	Any
                                            potential transferee pursuant to Article 22 below.



 


		21.2	This clause shall not prevent the Minister from communicating certain information to any governmental
entity and to credible persons interested in acquiring exploration and exploitation rights of Hydrocarbons in Benin.



 


		21.3	All reports, data and information communicated by the Minister or the Contractor to a third party in accordance
with the provisions above, shall be in compliance with agreements, the terms of which shall guarantee that such data, information or reports
shall be treated as strictly confidential by the receiver.



 


		21.4	The reports, data and information related to the Contract Region, and considered as important by the Minister
for the implementation of an exploration programme by a third party in a neighbouring zone, may be communicated to it by the Minister.
In return, the Contractor may have access to the data, information and reports obtained by the said third party concerning an adjoining
zone of comparable exploratory interest. The confidentiality clauses shall apply to that third party.



 


		21.5	All reports, data and information, including interpretations and evaluations related to any surface area
that is no longer part of the Contract Region following retrocession of surface or expiration of this Contract, shall be treated by the
Contractor in strict confidentiality for a period of [***] following the date when the said area stopped being an integral part
of the Contract Region or from the expiry date of this Contract.



 


		21.6	Any violation of the Confidentiality Clauses under this Article shall be punished according to the regulations
in force in Benin regarding disclosure of professional secrets.



 


		21.7	Any news publication initiated by the Contractor and relating to the results of the operations undertaken
in the frame of this Contract shall be subject to prior authorization from the Minister.



 






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ARTICLE 22: ASSIGNMENT OF RIGHTS


 


		22.1	The Parties may assign all or part of their rights and obligations arising from this Contract. If the
Contractor intends to assign or transfer its rights in whole or in part in accordance with the Contract, it must immediately submit a
written request for authorisation to the Minister, unless the transfer shall be made to an Affiliate, in which case it must notify the
Minister in writing of its intention to transfer [***] days before the effective date or at a later date agreed upon with the Minister,
after which the transfer shall become effective without the need for authorisation from the Minister. Any request should specify the name,
address and any appropriate information about the technical and financial capacities of the assignee. Within [***] following the
receipt of the request, the Minister must decide whether or not to approve the proposed transfer. Any disagreement of the Minister must
be based on reasonable causes related to technical and financial capacities of the proposed assignee.



 


		22.2	If one of the Parties does a partial assignment of its rights and obligations arising from this Contract,
the assignee shall be responsible, alone and jointly, for the guarantees, responsibilities and obligations of the assignor. If the assignment
is total, the assignee shall be responsible alone for the said obligations and guarantees. Any assignee must adhere to the bank guarantees
and give a guarantee to its parent company, if any, as required by this Contract.



 






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ARTICLE 23: FORCE MAJEURE


 


		23.1	The Parties shall not be held accountable for any default or delay in fulfilling their obligations arising
from this Contract if this default is due to a case of Force Majeure.



 


		23.2	Any action or event that is beyond the reasonable control of the Parties and which prevents them indefinitely
or temporarily from fulfilling their obligations by virtue of the Contract shall be considered a case of Force Majeure. Therefore, the
Force Majeure occurrence shall include but not be limited to the following cases: war or similar situations, embargoes, blockades, earthquakes,
floods, fire, strike or lock-out, terrorist act, riots, and acts of state.



 


		23.3	The Party that shall put forward the case of Force Majeure should:



 


		a)	Inform as soon as possible the other Party by all means and confirm by registered mail with acknowledgement
of receipt by describing precisely the event;



 


		b)	Take, if possible, all appropriate and legal measures to eliminate the cause of Force Majeure;



 


		c)	Inform the other Party in the same forms as soon as the Force Majeure has been eliminated and resume the
execution of the contractual obligations.



 


		23.4	If the case of Force Majeure lasts for more than [***], the Parties to the Contract shall meet
to determine the appropriate actions to undertake.



 


		23.5	It shall be agreed that if for reasons of Force Majeure, one Party is unable to fulfil an obligation or
exercise a right, then, in accordance with the Contract, the deadline given to fulfil the obligation or exercise the right, including
any obligation or any subsequent right, shall be extended for a period equal to the duration of the Force Majeure.



 






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ARTICLE 24: ARBITRATION AND EXPERTISE


 


		24.1	Arbitration 



 


		24.1.1	Subject to the provisions above related to the expertise, any conflict or complaint related to a question
or operation relating to the Contract, including among others, any dispute or complaint related to its validity, its interpretation, its
implementation or omission of the obligations that it shall entail and that cannot be solved amicably between the Parties, should be settled
with prejudice and exclusively through arbitration on the initiative of either Party.



 


		24.1.2	The arbitration procedure shall be enacted by three (3) arbitrators in accordance with the rules of conciliation
and arbitration of the International Centre for Settlement of Investment Disputes (ICSID) of the World Bank Group. The Parties agree to
respect the decisions of the arbitration tribunal.



 


		24.1.3	Unless the Parties otherwise decide by mutual agreement in writing, the third arbitrator designated as
indicated above must not be a Benin national or a person having the same nationality as the Contractor.



 


		24.1.4	For any arbitration procedure in accordance with this Article:



 


		a)	The procedure must take place in Paris (France), unless otherwise decided by the Parties by mutual agreement;



 


		b)	French shall be the official language in any respect, and



 


		c)	The decision of the majority of the arbitrators shall be imposed on the Parties.



 


		24.2	Expertise



 


		24.2.1	Any Party wishing to submit a matter for the decision of an expert in compliance with a provision of the
Contract that provides for that procedure, including the Accounting Appendix, or any other that the Parties shall decide to submit by
mutual agreement for the decision of an expert under this Article, should notify it to the other Party. This notification must include
a list of at least three (3) proposed experts. The other Party should respond to that notification within [***] days following
the date of receipt either by accepting one (1) of the proposed experts or by proposing at least three (3) others. In this last case,
the Party that presented the initial notification shall have [***] days to accept one (1) or reject all of the experts proposed
by the other Party. Non-notification shall constitute a rejection of the proposed experts.



 


		24.2.2	If the Parties do not reach an agreement in selecting an expert within the [***] days following
the date of the first notification by virtue of the paragraph above, any of the parties may ask the Technical Expert Centre of the International
Chamber of Commerce (ICC), based in Paris, to designate an expert in accordance with its regulations.



 


		24.2.3	If the expert agreed upon by the Parties or designated in accordance with the above-mentioned provisions
declines the request of the Parties, dies or, for any other reason, is in the impossibility to act as an expert, the Parties must meet
immediately to designate another expert to replace it. If the parties do not reach an agreement within [***] days following the
date it has been established that the first expert could not act, any of the Parties may ask the Technical Expert Centre of the ICC to
designate another one in accordance with its regulations.



 


		24.2.4	The Parties shall be bound to cooperate with the expert as much as possible and each Party must ensure
the cooperation of its Affiliates. The Parties should ensure the accessibility of the data and information the Parties or their Affiliates
can give and that, according to the expert, could contribute to its decision. The representatives of the Parties shall have the right
to consult the expert and to give it written information, but the expert can impose reasonable limits to this right. It shall be free
to evaluate if a document or information submitted for its assessment is justified or relevant.



 


		24.2.5	All costs related to the selection and use of the expert shall be financed jointly and equally by the
Parties.



 


		24.2.6	Any decision taken by the expert in accordance with this Article by virtue of a provision of the Contract
that explicitly provides for this procedure shall be final and binding on the Parties. No Party shall submit an issue decided by an expert
to an arbitration procedure as provided in this Contract. By mutual agreement among the Parties, issues submitted to the decision of an
expert may be the object of an ultimate and final decision through arbitration, if the Parties agree to do so when submitting the issue
to an expert.



 






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ARTICLE 25: CANCELLATION


 


		25.1	CANCELLATION BY THE STATE OR BY THE CONTRACTOR



 


		25.1.1	Notwithstanding any other action provided for herein, this Contract may be terminated by the Minister
in charge of Hydrocarbons without damages to the Contractor for any of the following reasons:



 


[***]


 


		25.1.2	During the exploitation period, the Contractor may terminate the Contract by written notice to the Minister
at least [***] days before the date of termination, provided that the Contractor has fulfilled all of its contractual obligations,
tax obligations and obligations arising from the corresponding Annual Work Programme.



 


		25.1.3	If the Contract is terminated in accordance with this Article, the Contractor shall have the right to
remove and export all goods it has used and the title of ownership of which has not been transferred, partially or totally, subject to
paying all debts due to the Government. The Contractor shall lose all other rights related to the Contract. It shall not be released from
any of the obligations it may have contracted before the effective date of termination, whether they derive from the said termination
or are the object of the termination.



 


		25.1.4	If the Contractor challenges any of the events provided in this Article or affirms that one of these events
happened but it has remedied it, the Contractor may appeal to an arbitration procedure or the decision of an expert within [***]
days following the date of receipt of the termination notification from the Minister.



 


		25.1.5	Before leaving the Contract Region following a termination, the Contractor should make sure that all the
wells are left in good state in accordance with Best Practices.



 


		25.1.6	The termination of the Contract takes place without any prejudice to any other right that, in compliance
with the Contract, could have been established in favour of the Parties before the said termination.



 


		25.2	Notification of Termination and grace period



 


		25.2.1	The Minister in charge of Hydrocarbons shall declare this Contract terminated after sending a formal notification
to the Contractor by any means that leaves a written record requesting that it remedy the situation or failure within [***] days
of receipt of this notice with regard to payments or within [***] days of receipt of this notice for all other situations.



 


		25.2.2	If the Contractor does not comply with this notification within the required period or does not demonstrate
within [***] Days or [***] days that it has began and shall continue diligently and promptly to remedy the situation or
failure in question, the Minister may automatically terminate this Contract.



 




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ARTICLE 26: BANK GUARANTEE


 


		26.1	To fulfil its minimum work obligations to the reasonable satisfaction of the Government, the Contractor
must submit an irrevocable bank guarantee of [***] within [***] of the Effective Date.



 


		26.2	Failing to present the bank guarantee within the required deadline shall be a violation of the provisions
of the Contract and shall lead de facto to its termination by the Minister in accordance with the provisions relating to termination.



 


		26.3	The payable amount in compliance with the above-mentioned bank guarantee shall be gradually reduced in
as much as the minimum work obligations for the year involved are well performed. For the purpose of this reduction, the Contractor may
at any moment submit to the approval of the Minister a declaration showing the level at which the work obligations have been performed.
This approval should intervene in reasonable deadlines.



 


		26.4	To make effective the above-mentioned deduction, the Minister should notify his approval of the bank guarantee
to the issuing bank within a deadline of [***] days from the date of receipt of the Contractor’s request.



 


		26.5	If the Contractor considers that the above-mentioned approval of the Minister has unjustifiably delayed
or if the Minister considers that the Contractor has not performed a minimum work obligation satisfactorily in accordance with Best Practices,
any one of the Parties may submit the matter for the decision of an expert.



 


		26.6	The guarantees to be presented by the Contractor in accordance with this Article must be approved by the
Minister. The Contractor must submit to the Minister the original documents of the guarantees so that he can check and preserve them.



 






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ARTICLE 27: NOTIFICATION


 


		27.1	To be considered valid, any communication or notification relating to the Contract must be presented on
a working day or received by registered mail, telegraph, telex or fax addressed to the receiver to the following addresses:



 


The Government:


 


Represented by the Minister of Energy,
Oil and Mining Research, Water and Development of Sustainable Energy


 


04 P.O. Box: 1412


 


Cotonou (Republic of Benin)


 


Fax (229) 21 31 35 46


 


The Contractor:


 


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


 


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


 


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


 


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


 


		27.2	The Parties shall have the right to change their address for the purpose of the provisions of notification
and communication by notifying it in writing to the other Party at least [***] days before the effective date of change.



 






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ARTICLE 28: APPLICABLE LEGISLATION, STABILISATION
AND COMPENSATION


 


		28.1	This Contract shall be governed and interpreted in accordance with the laws and regulations in force in
the republic of Benin.



 


		28.2	If the laws and regulations in force
                                            in Benin at the date of signature and applicable to the implementation or interpretation
                                            of the Contract or to the economic rights of the Parties are amended in a way to modify noticeably
                                            the existing economic balance between the Parties at the date of signature, they should meet
                                            to discuss any amendment that, by mutual agreement, shall restore the said balance. Any amendment
                                            adopted by mutual agreement by the Parties should take into account the most likely technical
                                            and commercial parameters in case of future development of the Hydrocarbons. If the parties
                                            do not agree on the parameters to be used for these calculations, or on the amendments that
                                            should restore the existing economic balance at the date of signature, the disagreements
                                            must be submitted for decision by an expert.



 


If
the laws of Benin are modified and therefore reduce the benefits or advantages of the contracting party, the terms of the Contract shall
be modified in order to balance the economic benefits of the contracting Party as they were on the Date of Signing of the Contract.


 


		28.3	If, in the Code or the regulation
                                            in force in Benin, there is no appropriate rule for the disagreement related to the Contract,
                                            the customs and practices of the international oil industry and the principles of law applicable
                                            in the field in the oil countries shall be used.



 


		28.4	The
                                            Parties agree that the Government shall bear the consequences of contractual, legal
                                            and financial commitments vis-à-vis the third parties, as well as any conflict and
                                            damages occurring for the duration of the Contract.



 






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ARTICLE
29: INFRASTRUCTURE


 


		29.1	The
                                            Government shall make things easier for the Contractor to undertake the Oil Operations, use
                                            any roads, storage tanks and other storage and treatment structures, quays and other loading
                                            and exportation structures, railroads, pipelines and other existing transportation infrastructures
                                            in Benin and that are not used exclusively for other activities including other oil activities.



 


		29.2	The
                                            Contractor shall pay the rights of passage and other reasonable fees for using such infrastructures
                                            in accordance with the regulations in force in Benin. The costs incurred in this context
                                            shall be considered as Oil Costs and may be recovered by the Contractor but shall not exceed
                                            those paid by the public in general or other parties in the same situation as the Contractor.



 






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ARTICLE 30: GUARANTEES FROM PARENT COMPANIES


 


The Contractor shall agree to produce on the Effective
Date of the Contract a letter from the Parent Companies guaranteeing the performances of ELEPHANT OIL LTD for all obligations described
or referred to in the Contract.


 






    Page 44 of 52


     


    

 


ARTICLE 31: FINAL PROVISIONS


 


		31.1	If on one or more occasions, the Ministry or the Contractor fails to put forward or to underline the fulfilment
of one of the provisions of the Contract, this shall not be interpreted as a renunciation of the future application of the provision or
right in question.



 


		31.2	All matters that are not expressly set out in this Contract shall be governed by the Code and the other
laws and regulations of the Republic of Benin.



 


		31.3	If a provision of the Contract is declared null or invalid for any reason whatsoever, that shall not mean
that the Contract or any of its provisions may be declared null or void, unless the Contract or its other provisions are concerned by
that nullity.



 


		31.4	The Contract cannot be modified without the unmistakable and written consent of the Parties, but the Minister
may, however, extend the period, during which the Contractor should perform well any obligation incumbent on it, or both Parties may exercise
freely, implicitly or explicitly any right conferred to them by virtue of this Contract.



 


		31.5	The titles used in the Contract shall serve only to make it understandable and shall not be interpreted
as bearing a particular meaning.



 


		31.6	Any reference in the singular shall include the plural and vice-versa.



 


		31.7	Any reference to gender shall include both genders.



 


		31.8	The Contract constitutes the full agreement of the Parties and shall replace all results of agreements
and negotiations completed between the Parties before the date of signature.



 


		31.9	The Contract, once signed by both Parties, shall be published in the Official Gazette of the Republic
of Benin and everywhere the need shall arise.



 


		31.10	This Contract is signed in two (2) originals.



 


Drafted in
Cotonou on 


 


	
    For the Government 

    of the Republic of Benin 
	 	
    For the Contractor 

     

	
     

    The Minister of Energy, Oil and Mining Research,
    Water and Development of Renewable Energy

     

     

    Barthélémy Dahoga KASSA 
	 	
     

    President of ELEPHANT OIL LTD

     

     

     

     

     

    Matthew LOFGRAN



 






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APPENDIXES


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 






    Page 46 of 52


     


    

 


APPENDIXES 


 


APPENDIX A: COORDINATES OF THE CONTRACT REGION


 


APPENDIX B: MAP OF THE CONTRACT REGION


 


APPENDIX C: BANK GUARANTEE


 


APPENDIX D: ACCOUNTING APPENDIX


 


APPENDIX E: ABANDONMENT PROCEDURE


 






    Page 47 of 52


     


    

 


APPENDIX “A”


 


[***]


 






    Page 48 of 52


     


    

 


APPENDIX B 


 


[***]


 






    Page 49 of 52


     


    

 


APPENDIX “C”


 


[***]


 






    Page 50 of 52


     


    

 


APPENDIX “D” 


 


[***]


 






    Page 51 of 52


     


    

 


APPENDIX ’‘E’’


 


[***]


 


 


Page 52 of 52