Document:

ESCROW AGREEMENT

 

THIS AGREEMENT is made and entered into as of the Effective
Date, as defined in Paragraph 7(e) hereof, by and among the following:

 

E & P CO, LLC, 2500 Tanglewilde,
Suite 260, Houston, TX 77063, (“Operator”) represented herein by Osman Kaldirim, Jr., President and duly authorized
to execute this Agreement on behalf of Operator; and,

 

JUSTISS OIL COMPANY, INC., P.O.
Box 2990, Jena, Louisiana 71342, (“Contractor”) represented herein by J. F. Justiss, III, Vice President, Operations
and duly authorized to execute this Agreement on behalf of Contractor; and,

 

BANK OF JENA, P.O. Box 1440, Jena,
Louisiana 71342 (“Escrow Agent”), represented herein by W. Paul Tweedy, President being and duly authorized to execute
this Agreement on behalf of Escrow Agent;

 

WHEREAS, the Operator and Contractor
have entered into and executed a Model Form IADC Daywork Drilling Contract-U.S. (the “Contract”) providing for the
drilling of IP CO SWD #2, located in Section 35-T14N-R5E, Caldwell Parish, Louisiana (the “Project”);

 

WHEREAS, the Operator and Contractor
have agreed to enter into and execute an Escrow Agreement for the purpose of assuring payment to the Contractor of all sums due
and to become due to the Contractor under the terms of the Contract; and,

 

IT IS THEREFORE AGREED:

 

		1)	Required Escrow Payment

 

(a)      Concurrently
with the execution of this Escrow Agreement the Operator will deposit by wire transfer with the Escrow Agent the sum of $225,325.00
in cash plus the Escrow Fee provided in Paragraph 5(j) below, the receipt of which will be acknowledged to each of Operator and
Contractor in writing by the Escrow Agent (the “Initial Escrow Fund” and, together with the “Supplemental Escrow
Funds”, herein together the “Escrow Fund”).

 

The amount of the Initial Escrow Fund is
based upon a mobilization and demobilization fee of $54,325.00, and 12 days at the operating daywork rate of $14,250.00.

 

(b)      It is the intent
hereof that the Escrow Fund shall, at all times, contain an amount not less than an amount necessary to cover the amount that may
reasonably be due to Contractor as calculated in accordance with the Contract (in excess of the amount then on deposit in the Escrow
Fund), as provided by written agreement of Operator and Contractor (“Supplemental Escrow Agreement”).

 

(c)      If it is anticipated
that additional work is to be conducted on a Daywork Basis, as provided in the Contract, Contractor shall notify Operator in
writing (in accordance with Section 6 hereof) that an additional escrow deposit (each a “Supplemental Escrow Deposit”)
is required as specified by the relevant Supplemental Escrow Agreement. Each Supplemental Escrow Deposit shall be in an amount
not more than (10) days of daywork per each Supplemental Escrow Deposit at the operating day rate, with drill pipe, all calculated
in accordance with the Contract. Each Supplemental Escrow Deposit shall be wired to the Escrow Fund within 48 hours following execution
of the Supplemental Escrow Agreement. The receipt of each Supplemental Escrow Deposit shall be acknowledged by Notice in writing
provided to each of the Operator and Contractor by Escrow Agent. Thereafter, from time to time, as required and set forth in a
Supplemental Escrow Agreement, the Contractor may require, and the Operator shall deposit, one or more Supplemental Escrow Fund
Deposits in increments of not more than (10) days, until the job is complete. 

 

		2)	Appointment and Acceptance

 

Operator and Contractor
hereby appoint Bank of Jena as Escrow Agent and Bank of Jena accepts such appointment pursuant to the terms hereof.

 

    	 

    	 

    

 

		3)	Release of Escrow Funds

 

The Escrow Fund and
shall be held by the Escrow Agent and deposited into a Special Escrow Fund to be released by the Escrow Agent to the Contractor
in incremental payments (“Incremental Payments”) in the following manner:

 

The Contractor shall
invoice Operator, as provided by Paragraph 5 of the Contract, notwithstanding any contrary provision of said Paragraph 5. Contractor
shall be permitted to request and receive incremental payments from the Escrow Fund as hereinafter provided. (together “Incremental
Payments” and, each, an “Incremental Payment”) calculated in accordance with the work properly completed as determined
under the Contract. The Operator shall have the right to approve the invoice for each Incremental Payment and, if so approved,
shall forward the invoice to the Escrow Agent for payment (“Approved Payment”). If the invoice(s) are not approved
and released for payment to Escrow Agent within 30 days of receipt thereof by Operator, then the Contractor shall furnish the following
to each of Escrow Agent and the Operator:

 

		1)	A copy of the relevant invoice(s) certified to be true, correct, and complete (“Certified
Invoice(s)”); and,

 

		2)	The Contractor’s affidavit (executed by a duly authorized officer of Contractor) certifying
that the Mobilization and Daywork provisions of the contract have been fulfilled, that the amount invoiced is due, and that there
is no dispute as to payment (the “Contractor’s Certification” and, together with the Certified Invoice(s), the
(“Contractor’s Documents”).

 

Upon receipt of the applicable a) Approved
Payment from the Operator or b) the Contractor’s Documents, whichever is first received, the Escrow Agent shall release and
pay to the Contractor the amount of the subject invoice(s) in the following manner:

 

		A)	Incremental Payment and a description of the job progress point at which incremental payment was
earned, and the due date thereof.

 

		B)	The Balance of Payments due/ and total due upon completion of the obligations.

 

In the event either of the Operator or
the Escrow Agent shall not have duly received all of the Contractor’s Documents, the i) Operator shall give Notice of “a)”
above to the Escrow Agent and the Operator and “i)” the balance of the Escrow Fund shall be released by the Escrow
Agent and paid to the Operator.

 

		4)	Disputed Payment

 

In the event of a
dispute as to the disposition and release of all or a part of the Escrow Fund, the disputing Party (“Disputing Party”)
shall notify the other Parties hereto, in writing, as to the basis for the dispute within thirty (30) days of the date of receipt
of the subject Invoice by Disputing Party. If the dispute cannot be resolved by agreement, the Escrow Agent may, subject to the
provisions of Paragraph (5)(b), commence an action in the nature of an interpleader and deposit the disputed portion of the Escrow
Fund with a Court of competent jurisdiction for disposition and shall pay the undisputed portion to the Contractor.

 

		5)	Rights, Privileges, Immunities, and Liabilities of Bank

 

a)      Depository
Only. The Escrow Agent is not a party to and is not bound or charged with notice of any other agreement out of which this escrow
arises, and acts hereunder as a depository only. Except in the event of a loss occasioned by gross negligence or willful misconduct,
the Bank is not responsible or liable in any manner whatsoever for the sufficiency, correctness, genuineness, or validity of any
document, instrument, certificate, check, or agreement, or for the identity or authority of any person executing or depositing
the same, and may assume any person purporting to give any written notice, advice, or instruction in connection with the provisions
hereof has been duly authorized to do so. The Escrow Agent shall not be deemed to have any knowledge of any documents other than
this Escrow Agreement. The Escrow Agent shall not be liable for anything that it may do or refrain from doing in connection herewith,
except on account of its own gross negligence or willful misconduct. The Escrow Agent’s only duty, liability, and responsibility
shall be to hold the Escrow Fund as herein directed, to invest the same in a Federal Deposit Insurance Corporation insured account,
and to pay and deliver the same to such persons and under such conditions as are herein set forth.

 

    	2

    	 

    

 

b)      Indemnity.
The Contractor and Operator hereby agree, jointly and severally, to indemnify and save Escrow Agent harmless from all loss, cost,
damage, expense, and attorney’s fees suffered or incurred by Escrow Agent as a result of any action or inaction taken or
failed to be taken by the Escrow Agent in connection herewith, other than losses, costs, damages, expenses, and attorney’s
fees resulting from the Escrow Agent’s gross negligence or willful misconduct. All protections and indemnities contained
in this Escrow Agreement, benefiting the Escrow Agent, shall survive the termination of this Escrow Agreement or the resignation
or removal of the Escrow Agent.

 

c)      Actions Protected. The Escrow
Agent shall be protected in acting on any written notice, request, waiver, consent, certificate, receipt, authorization, power
of attorney or other paper or document which the Escrow Agent in good faith believes to be genuine.

 

d)      Good Faith Action. Except
for acts of gross negligence or willful misconduct, the Escrow Agent shall not be liable for anything that it may do or refrain
from doing in connection herewith, provided that it acts in good faith.

 

e)      Legal Counsel. The Escrow
Agent may confer with legal counsel in the event of any dispute or questions as to the construction of any of the provisions of
this Escrow Agreement, or its duties hereunder, and except for acts of gross negligence or willful misconduct, it shall incur no
liability and shall be fully protected in acting in accordance with the opinion and instructions of its counsel.

 

f)      Event of Dispute. In the event
of any disagreement involving the parties resulting in adverse claims or demands being made in connection with the matters covered
by this Escrow Agreement or in the event that Bank, in good faith, shall be in doubt as to what action it should take hereunder,
the Escrow Agent may, at its option, refuse to comply with any claims or demands on it and institute a concursus proceeding in
a Court of competent jurisdiction and all of the parties to resolve their conflicting claims judicially. The rights of Escrow Agent
under this subparagraph are cumulative of all other rights which it may have by law or otherwise.

 

g)      Discharge. The Escrow Agent,
having duly delivered all of the documents, instruments, funds, certificates, agreements, and otherwise duly performing each of
its other obligations pursuant to the terms of this Agreement, shall be, ipso facto, discharged from
any further obligation hereunder except as otherwise provided herein, without the necessity of any formal documentation.

 

h)      Bond. The Escrow Agent shall
not be required to post a bond in connection with the providing of its services hereunder.

 

i)      Resignation. The Escrow Agent
and any successor to it hereafter appointed (“Successor”), may at any time resign by giving prior Notice in writing
to Contractor and Operator (“Notice of Resignation”) and shall be discharged from its duties hereunder upon the appointment
of a Successor, compliance with the requirements of Sub-Section 5(c) hereof, and the assignment of this Agreement to, and assumption
of this Agreement by, the Successor, together with any agreements, undertakings, and other obligations of Escrow Agent under, or
in connection with, this Agreement (“Ancillary Documents”). In the event of any such resignation, a successor Escrow
Agent shall be appointed by the written consent of Contractor and Operator. In the event that Contractor and Operator fail to appoint
a Successor within thirty (30) days of the receipt of the Notice of Resignation by the last of the Contractor or Operator to so
receive the Notice of Resignation, the Escrow Agent shall have the absolute right to appoint another federally chartered bank or,
if agreed in writing by Contractor and Operator, another entity, which is willing to serve as the Successor. Any Successor shall
deliver to Contractor and Operator a written instrument accepting the appointment hereunder, and thereupon it shall succeed to
all the rights and duties of the Escrow Agent hereunder and shall be entitled to receive all of the Escrow Fund then held by the
predecessor Escrow Agent hereunder.

 

j)      The Escrow Fee. The Escrow
Agent shall charge a fixed fee in the amount of Two Thousand Dollars ($2,000) as a fee for the services rendered and to be rendered
as Escrow Agent. The escrow account will be non-interest bearing.

 

k)      Final Release of Escrow Funds
Balance. At the conclusion of the drilling operation to be performed by the Contractor for the Operator and after the Contractor
has been paid in full for all invoices submitted for the work performed, including any final billing for the demobilization fee,
any and all excess funds remaining in the Escrow Fund and Supplemental Escrow Fund, shall be paid and delivered to the Operator,
pursuant to the authorization to the Escrow agent, in writing, signed by Operator and Contractor.

 

    	3

    	 

    

 

6)      Notice. All notices, requests, demands, claims,
and other communications that are required to be, or which may be, given by any Party (“Notifying Party”) under this
Agreement (each, a “Notice”) shall be in writing addressed to the each of the other Parties (“Intended Recipients”
or, each, an “Intended Recipient”), at the relevant Intended Recipient’s address set forth following. Any Notice
shall be delivered (i) in person; (ii) by same day or overnight courier; (iii) by electronic facsimile or email transmission, or
(iv) mailed, certified first class mail, postage prepaid, return receipt requested, to the Intended Recipient.

 

	Operator:	
        E & P Company, LLC 2500

	 	Tanglewilde, Suite 260
	 	Houston, TX  77063
	 	Attn: Osman Kaldirim, Jr., President
	 	 
	Contractor:	Justiss Oil Company, Inc.
	 	P.O. Box 2990
	 	Jena, LA 71342
	 	Attn: Wayne Pritchard
	 	 
	Escrow Agent:	William B Higdon, Jr., Senior Vice-President & CFO
	 	P.O. Box 1440
	 	Jena, LA 71342
	 	Attn: Paul Tweedy

 

By Notice given in accordance with this Section, any Party may
provide, at any time, a different address or other information for notice under this Section.

 

A Notice shall be effective (“Notice Effective Date”)
(i) if delivered in person or by courier, upon actual receipt by the Intended Recipient, (ii) if sent by electronic facsimile or
email transmission, when the Notifying Party receives facsimile or email confirmation that such notice was received at the facsimile
number or email address, as the case may be, of the Intended Recipient, or (iii) if mailed, upon the earlier of five (5) business
days after deposit in the mail or the date of delivery as shown by the return receipt.

 

7)      Miscellaneous

 

a)      This Agreement
may not be altered, amended, revised or modified, in whole or in part, except by written agreement signed by all of the Parties
hereto.

 

b)      This Agreement
is an ancillary to and shall be read and considered with the Daywork Drilling Contract-U.S., between Justiss Oil Company, Inc.
and E & P Co, LLC., with an effective date of January 31, 2014, except as herein provided.

 

c)      This Agreement
shall be binding upon and inure to the benefit of the Parties hereto and their successors and permitted assigns.

 

d)      This Agreement
may be executed in multiple counterparts, each of which shall be deemed an original.

 

e)      This Agreement
shall not take effect until the latter to occur of i) all Parties having signed the Agreement; or, ii) the amount of the Initial
Escrow Fund has been delivered to the Escrow Agent

 

{Signature
Page Next}

 

    	4

    	 

    

 

IN WITNESS WHEREOF, this Agreement has been entered into
and executed as of the Effective Date.

 

	E & P Co, LLC
	 
	By: 	 	 
	 	Osman Kaldirim, Jr., President

 

	JUSTISS OIL COMPANY, INC.
	 
	By: 	 	 
	 	James F. Justiss III, Vice-President

 

	William B Higdon, Jr., Senior Vice-President & CFO
	 
	By: 	 	 
	 	William B Higdon, Jr., Senior Vice-President & CFO

 

    	5NOTE: This
form contract is a suggested guide only and use of this form or any variation thereof shall be at the sole discretion and risk
of the user parties. Users of the form contract or any portion or variation thereof are encouraged to seek the advice of counsel
to ensure that their contract reflects the complete agreement of the parties and applicable law. The International Association
of Drilling Contractors disclaims any liability whatsoever for loss or damages which may result from use of the form contract
or portions or variations thereof. Computer generated form, reproduced under license from IADC.

		 	 
	Revised
    April, 2003
	INTERNATIONAL ASSOCIATION
    OF DRILLING CONTRACTORS	 
	DRILLING BID PROPOSAL	 
	AND	 
	DAYWORK DRILLING
    CONTRACT - U.S.	 

 

	TO:	 
	 	 

 

	Please
    submit bid on this drilling contract form for performing the work outlined below, upon the terms and for the consideration
    set forth, with the understanding that if the bid is accepted by  ____________________________________
	 
	this
    instrument will constitute a Contract between us. Your bid should be mailed or delivered not later than _______ P.M. on ________________
    , 20 ______ , to the following address:   ______________________________________________
	 

 

THIS CONTRACT
CONTAINS PROVISIONS RELATING TO INDEMNITY,

RELEASE OF
LIABILITY, AND ALLOCATION OF RISK –

SEE PARAGRAPHS
4.9, 6.3(c), 10, 12, AND 14

 

	This
    Contract is made and entered into on the date hereinafter set forth by and between the parties herein designated as “Operator”
    and “Contractor.”
	OPERATOR:	E
    & P Co, LLC
	Address:	2500
    Tanglewilde, Suite 260
	 	Houston,
    TX 77063
	CONTRACTOR:	Justiss
    Oil Company, Inc.
	Address:	P.O.
    Box 2990
	 	Jena,
    LA 71342

 

IN CONSIDERATION
of the mutual promises, conditions and agreements herein contained and the specifications and special provisions set forth
in Exhibit “A” and Exhibit “B” attached hereto and made a part hereof (the “Contract”), Operator
engages Contractor as an independent contractor to drill the hereinafter designated well or wells in search of oil or gas on a
Daywork Basis.

 

For purposes
hereof, the term “Daywork” or “Daywork Basis” means Contractor shall furnish equipment, labor,
and perform services as herein provided, for a specified sum per day under the direction, supervision and control of Operator
(inclusive of any employee, agent, consultant or subcontractor engaged by Operator to direct drilling operations). When
operating on a Daywork Basis, Contractor shall be fully paid at the applicable rates of payment and assumes only the obligations
and liabilities stated herein. Except for such obligations and liabilities specifically assumed by Contractor, Operator shall
be solely responsible and assumes liability for all consequences of operations by both parties while on a Daywork Basis, including
results and all other risks or liabilities incurred in or incident to such operations.

 

		1.	LOCATION
                                         OF WELL:
		 	Well
                                         Name

                                         and Number:	     IP
                                         CO SWD #2                                                                                                                           

		        	Parish/

                                                                                County:   
	     Caldwell                              	State:  	Louisiana                	Field

                                                                                Name:     
	Woolen
Lake                                 

		 	Well location and

                                                                                land description:
	     Section
35 – T14N – R5E                                                                                                           
		 	 	 

 

	       1.1 Additional Well Locations or Areas:	 N/A
	 

 

Locations described above are for well
and Contract identification only and Contractor assumes no liability whatsoever for a proper survey or location stake on Operator’s
lease.

 

		2.	COMMENCEMENT DATE:

Contractor agrees to use reasonable efforts to commence
operations for the drilling of the well by the      7th        day
of     February                
  , 2014  , or    upon agreement between Contractor and Operator                                              

	 

 

		3.	DEPTH:

3.1 Well Depth: The well(s) shall
be drilled to a depth of approximately          2,300         
feet, or to the      N/A       formation, whichever is deeper,
but the Contractor shall not be required hereunder to drill said well(s) below a maximum depth of        5,500       
feet, unless Contractor and Operator mutually agree to drill to a greater depth.

 

		4.	DAYWORK RATES:

Contractor shall be paid at the following rates for the
work performed hereunder.

 

4.1 Mobilization: Operator
shall pay Contractor a mobilization fee of $       54,325.00     or
a mobilization day rate of $       N/A      per day. This sum
shall be due and payable in full at the time the rig is rigged up or positioned at the well site ready to spud. Mobilization
shall include:

	Contractor to furnish rig, trucks, labor and materials to move on location and rig up, ready to start operations.
	 

 

4.2 Demobilization: Operator shall
pay Contractor a demobilization fee of $      N/A                    
or a demobilization day rate during tear down of $             N/A         
per day, provided however that no demobilization fee shall be payable if the Contract is terminated due to the total loss
or destruction of the rig. Demobilization shall include: Contractor to furnish rig, labor and materials to rig down and prepare
to move rig off location.                                                                                

	 

 

4.3 Moving Rate: During the time
the rig is in transit to or from a drill site, or between drill sites, commencing on                N/A                 ,
Operator shall pay Contractor a sum of $                N/A                   per twenty-four (24) hour day.

 

4.4 Operating Day Rate: For work
performed per twenty-four (24) hour day with      a five (5)                          
man crew the operating day rate shall be:

 

	Depth Intervals	 
	From	To	Without Drill Pipe	With Drill Pipe
	0	 	TD	$	14,250.00	per day	$	14,250.00	per day
	 	 	 	$	 	per day	$	 	per day
	 	 	 	$	 	per day	$	 	per day
	 	 	 	 	 	 	 	 	 	 

	Using Operator’s drill pipe $	14,250.00	per day. Deviated hole rate $14,550.00 per day.

 

The rate will begin when the
drilling unit is rigged up at the drilling location, or positioned over the location during marine work, and ready to
commence operations; and will cease when the rig is ready to be moved off the location.

 

	(U.S. Daywork Contract - Page 1)	Form provided by Forms On-A-Disk
	Copyright © 2003 International Association of Drilling Contractors	(214) 340-9429  
    FormsOnADisk.com

 

    	 

    	 

    

 

 Revised April, 2003

 

If under the
above column "With Drill Pipe" no rates are specified, the rate per twenty-four hour day when drill pipe is in use shall
be the applicable rate specified in the column "Without Drill Pipe" plus compensation for any drill pipe actually
used at the rates specified below, computed on the basis of the maximum drill pipe in use at any time during each twenty-four
hour day.

DRILL PIPE
RATE PER 24-HOUR DAY See page 1, paragraph 4.4

	 	Straight
    Hole	 	Size	 	Grade	 	Directional
        or

        Uncontrollable
        Deviated Hole
	Size	 	Grade
	$	 N/A	per
    ft.	 	 	 	$	 N/A	per
    ft.	 	 	 
	$	 	per
    ft.	 	 	 	$	 	per
    ft.	 	 	 
	$	 	per
    ft.	 	 	 	$	 	per
    ft.	 	 	 

 

Directional or uncontrolled deviated
hole will be deemed to exist when deviation exceeds       6      
degrees or when the change of angle exceeds          1-1/2        
degrees per one hundred feet.

 

Drill
pipe shall be considered in use not only when in actual use but also while it is being picked up or laid down. When drill pipe
is standing in the derrick, it shall not be considered in use, provided, however, that if Contractor furnishes special
strings of drill pipe, drill collars, and handling tools as provided for in Exhibit "A", the same shall be considered
in use at all times when on location or until released by Operator. In no event shall fractions of an hour be considered in computing
the amount of time drill pipe is in use but such time shall be computed to the nearest hour, with thirty minutes or more being
considered a full hour and less than thirty minutes not to be counted.

 

4.5
Repair Time: In the event it is necessary to shut down Contractor's rig for repairs, excluding routine rig servicing, Contractor
shall be allowed compensation at the applicable rate for such shut down time up to a maximum of       4      
hours for any one rig repair job, but not to exceed       24      
hours of such compensation for any calendar month. Thereafter, Contractor shall be compensated at a rate of $      0      
per twenty-four (24) hour day. Routine rig servicing shall include, but not be limited to, cutting and slipping drilling line,
changing pump or swivel expendables, testing BOP equipment, lubricating rig, and Changing shale shaker screens.                                                                                               .

 

4.6
Standby Time Rate: $      14,250.00       per twenty-four(24)
day. Standby time shall be defined to include time when the rig is shut down although in readiness to begin or resume operations
but Contractor is waiting on orders of Operator or on materials, services or other items to be furnished by Operator.

 

4.7
Drilling Fluid Rates: When drilling fluids of a type and characteristic that increases Contractor’s cost of performance
hereunder, including, but not limited to, oil-based mud or potassium chloride, are in use, Operator shall pay Contractor in addition
to the operating rate specified above:

 

		(a)    	$
                                              30.00       per man per
                                         day for Contractor’s rig-site personnel.

		(b)    	$
                                              300.00     per day additional operating
                                         rate; and

		(c)    	Cost
                                         of all labor, material and services plus        actual       hours operating rate to clean rig
                                         and related equipment.

 

4.8      Force
Majeure Rate: $      14,250.00       per twenty-four (24)
hour day for any continuous period that normal operations are suspended or cannot be carried on due to conditions of Force Majeure
as defined in Paragraph 17 hereof. It is, however, understood that subject to Subparagraph 6.3 below, Operator can release the
rig in accordance with Operator's right to direct stoppage of the work, effective when conditions will permit the rig to be moved
from the location.

 

4.9      Reimbursable
Costs: Operator shall reimburse Contractor for the costs of material, equipment, work or services which are to be furnished
by Operator as provided for herein but which for convenience are actually furnished by Contractor at Operator's request, plus
      15       percent for such cost of handling. When,
at Operator’s request and with Contractor’s agreement, the Contractor furnishes or subcontracts for certain items
or services which Operator is required herein to provide, for purposes of the indemnity and release provisions of this Contract,
said items or services shall be deemed to be Operator furnished items or services. Any subcontractors so hired shall be deemed
to be Operator’s contractor, and Operator shall not be relieved of any of its liabilities in connection therewith.

 

4.10      Revision
in Rates: The rates and/or payments herein set forth due to Contractor from Operator shall be revised to reflect the change
in costs if the costs of any of the items hereinafter listed shall vary by more than       10      
percent from the costs thereof on the date of this Contract or by the same percent after the date of any revision pursuant
to this Subparagraph:

 

		(a)	Labor
                                         costs, including all benefits, of Contractor's personnel;

		(b)	Contractor's
                                         cost of insurance premiums;

		(c)	Contractor's
                                         cost of fuel, including all taxes and fees; the cost per gallon/MCF being $      
                                         N/A      ; (Operator furnished)

		(d)	Contractor's
                                         cost of catering, when applicable;

		(e)	If Operator
                                         requires Contractor to increase or decrease the number of Contractor's personnel;

		(f)	Contractor's
                                         cost of spare parts and supplies with the understanding that such spare parts and supplies
                                         constitute      25      
                                         percent of the operating rate and that the parties shall use the U.S. Bureau of Labor
                                         Statistics Oil Field and Gas Field Drilling Machinery Producer Price Index (Series ID
                                         WPU119102) to determine to what extent a price variance has occurred in said spare parts
                                         and supplies;

		(g)	If there
                                         is any change in legislation or regulations in the area in which Contractor is working
                                         or other unforeseen, unusual event that alters Contractor's financial burden.

 

5.    TIME
OF PAYMENT

 

Payment
is due by Operator to Contractor as follows:

 

5.1
Payment for mobilization, drilling and other work performed at applicable rates, and all other applicable charges shall be
due, upon presentation of invoice therefore, upon completion of mobilization, demobilization, rig release or at the end of the
month in which such work was performed or other charges are incurred, whichever shall first occur. All invoices may be mailed
to Operator at the address hereinabove shown, unless Operator does hereby designate that such invoices shall be mailed as follows:
        N/A      .

 

5.2
Disputed Invoices and Late Payment: Operator shall pay all invoices within       30      
days after receipt except that if Operator disputes an invoice or any part thereof, Operator shall, within fifteen days after
receipt of the invoice, notify Contractor of the item disputed, specifying the reason therefor, and payment of the disputed item
may be withheld until settlement of the dispute, but timely payment shall be made of any undisputed portion. Any sums (including
amounts ultimately paid with respect to a disputed invoice) not paid within the above specified days shall bear interest at the
rate of       1-1/2       percent or the maximum legal rate,
whichever is less, per month from the due date until paid. If Operator does not pay undisputed items within the above stated time,
Contractor may suspend operations or terminate this Contract as specified under Subparagraph 6.3. See page 7, paragraph 27.2

 

6.    TERM:

 

6.1      Duration
of Contract: This Contract shall remain in full force and effect until drilling operations are completed on the well or wells
specified in Paragraph 1 above, or for a term of    One well      , commencing
on the date specified in Paragraph 2 above.

 

6.2      Extension
of Term: Operator may extend the term of this Contract for         N/A      
well(s) or for a period of N/A by giving notice to Contractor at least      N/A      
days prior to completion of the well then being drilled or by   N/A 

	 

 

6.3     Early
Termination:

 

(a)      By
Either Party: Upon giving of written notice, either party may terminate this Contract when total loss or destruction of the
rig, or a major breakdown with indefinite repair time necessitate stopping operations hereunder.

 

(b)      By
Operator: Notwithstanding the provisions of Paragraph 3 with respect to the depth to be drilled, Operator shall have the
right to direct the stoppage of the work to be performed by Contractor hereunder at any time prior to reaching the specified
depth, and even though Contractor has made no default hereunder. In such event, Operator shall reimburse Contractor as set
forth in Subparagraph 6.4 hereof.

 

	(U.S. Daywork Contract -
    Page 2)	Form
    provided by Forms On-A-Disk
	Copyright
    © 2003 International Association of Drilling Contractors	(214)
340-9429   FormsOnADisk.com

 

    	 

    	 

    

 

Revised April, 2003

 

(c)      By
Contractor: Notwithstanding the provisions of Paragraph 3 with respect to the depth to be drilled, in the event Operator shall
become insolvent, or be adjudicated a bankrupt, or file, by way of petition or answer, a debtor's petition or other pleading seeking
adjustment of Operator's debts, under any bankruptcy or debtor's relief laws now or hereafter prevailing, or if any such be filed
against Operator, or in case a receiver be appointed of Operator or Operator's property, or any part thereof, or Operator's affairs
be placed in the hands of a Creditor's Committee, or, following three business days prior written notice to Operator if Operator
does not pay Contractor within the time specified in Subparagraph 5.2 all undisputed items due and owing, Contractor may, at its
option, (1) elect to terminate further performance of any work under this Contract and Contractor's right to compensation shall
be as set forth in Subparagraph 6.4 hereof, or (2) suspend operations until payment is made by Operator in which event the standby
time rate contained in Subparagraph 4.6 shall apply until payment is made by Operator and operations are resumed. In addition
to Contractor's rights to suspend operations or terminate performance under this Paragraph, Operator hereby expressly agrees to
protect, defend and indemnify Contractor from and against any claims, demands and causes of action, including all costs of defense,
in favor of Operator, Operator's co-venturers, co-lessees and joint owners, or any other parties arising out of any drilling commitments
or obligations contained in any lease, farmout agreement or other agreement, which may be affected by such suspension of operations
or termination of performance hereunder.

 

6.4      Early
Termination Compensation:

 

(a)      Prior
to Commencement: In the event Operator terminates this Contract prior to commencement of operations hereunder, Operator shall
pay Contractor as liquidated damages and not as a penalty a sum equal to the standby time rate (Subparagraph 4.6) for a period
of       5       days or a lump sum of $      71,250.00      .

 

(b)      Prior
to Spudding: If such termination occurs after commencement of operations but prior to the spudding of the well, Operator shall
pay to Contractor the sum of the following: (1) all expenses reasonably and necessarily incurred and to be incurred by Contractor
by reason of the Contract and by reason of the premature termination of the work, including the expense of drilling or other crew
members and supervision directly assigned to the rig; (2) ten percent (10%) of the amount of such reimbursable expenses; and (3)
a sum calculated at the standby time rate for all time from the date upon which Contractor commences any operations hereunder
down to such date subsequent to the date of termination as will afford Contractor reasonable time to dismantle its rig and equipment
provided, however, if this Contract is for a term of more than one well or for a period of time, Operator shall pay Contractor,
in addition to the above, the Force Majeure Rate, less any unnecessary labor, from that date subsequent to termination upon which
Contractor completes dismantling its rig and equipment until the end of the term or        N/A                                                                                                       .

	 

 

(c)      Subsequent
to spudding: If such termination occurs after the spudding of the well, Operator shall pay Contractor (1) the amount for all
applicable rates and all other charges and reimbursements due to Contractor; but in no event shall such sum, exclusive of reimbursements
due, be less than would have been earned for            10           
days at the applicable rate "Without Drill Pipe" and the actual amount due for drill pipe used in accordance with
the above rates; or (2) at the election of Contractor and in lieu of the foregoing, Operator shall pay Contractor for all expenses
reasonably and necessarily incurred and to be incurred by reason of this Contract and by reason of such premature termination
plus a lump sum of $      142,500.00                 
provided, however, if this Contract is for a term of more than one well or for a period of time, Operator shall pay Contractor,
in addition to the above, the Force Majeure Rate less any unnecessary labor from the date of termination until the end of the
term or        N/A                                                                                           .

	 
	 

 

7.      CASING
PROGRAM

 

Operator
shall have the right to designate the points at which casing will be set and the manner of setting, cementing and testing. Operator
may modify the casing program, however, any such modification which materially increases Contractor's hazards or costs can only
be made by mutual consent of Operator and Contractor and upon agreement as to the additional compensation to be paid Contractor
as a result thereof.

 

8.    DRILLING
METHODS AND PRACTICES:

 

8.1      Contractor
shall maintain well control equipment in good condition at all times and shall use all reasonable means to prevent and control
fires and blowouts and to protect the hole.

 

8.2      Subject
to the terms hereof, and at Operator's cost, at all times during the drilling of the well, Operator shall have the right to control
the mud program, and the drilling fluid must be of a type and have characteristics and be maintained by Contractor in accordance
with the specifications shown in Exhibit "A".

 

8.3      Each
party hereto agrees to comply with all laws, rules, and regulations of any federal, state or local governmental authority which
are now or may become applicable to that party's operations covered by or arising out of the performance of this Contract. When
required by law, the terms of Exhibit "B" shall apply to this Contract. In the event any provision of this Contract
is inconsistent with or contrary to any applicable federal, state or local law, rule or regulation, said provision shall be deemed
to be modified to the extent required to comply with said law, rule or regulation, and as so modified said provision and this
Contract shall continue in full force and effect.

 

8.4      Contractor
shall keep and furnish to Operator an accurate record of the work performed and formations drilled on the IADC-API Daily Drilling
Report Form or other form acceptable to Operator. A legible copy of said form shall be furnished by Contractor to Operator.

 

8.5      If
requested by Operator, Contractor shall furnish Operator with a copy of delivery tickets covering any material or supplies provided
by Operator and received by Contractor.

 

9.    INGRESS,
EGRESS, AND LOCATION:

 

Operator
hereby assigns to Contractor all necessary rights of ingress and egress with respect to the tract on which the well is to be located
for the performance by Contractor of all work contemplated by this Contract. Should Contractor be denied free access to the location
for any reason not reasonably within Contractor's control, any time lost by Contractor as a result of such denial shall be paid
for at the standby time rate. Operator agrees at all times to maintain the road and location in such a condition that will allow
free access and movement to and from the drilling site in an ordinarily equipped highway type vehicle. If Contractor is required
to use bulldozers, tractors, four-wheel drive vehicles, or any other specialized transportation equipment for the movement of
necessary personnel, machinery, or equipment over access roads or on the drilling location, Operator shall furnish the same at
its expense and without cost to Contractor. The actual cost of repairs to any transportation equipment furnished by Contractor
or its personnel damaged as a result of improperly maintained access roads or location will be charged to Operator. Operator shall
reimburse Contractor for all amounts reasonably expended by Contractor for repairs and/or reinforcement of roads, bridges and
related or similar facilities (public and private) required as a direct result of a rig move pursuant to performance hereunder.
Operator shall be responsible for any costs associated with leveling the rig because of location settling.

 

	(U.S. Daywork Contract -
    Page 3)	Form
    provided by Forms On-A-Disk
	Copyright
    © 2003 International Association of Drilling Contractors	(214)
    340-9429  
    FormsOnADisk.com

 

    	 

    	 

    

  Revised
April, 2003

 

10.  SOUND
LOCATION:

 

Operator
shall prepare a sound location adequate in size and capable of properly supporting the drilling rig, and shall be responsible
for a casing and cementing program adequate to prevent soil and subsoil wash out. It is recognized that Operator has superior
knowledge of the location and access routes to the location, and must advise Contractor of any subsurface conditions, or obstructions
(including, but not limited to, mines, caverns, sink holes, streams, pipelines, power lines and communication lines) which Contractor
might encounter while en route to the location or during operations hereunder. In the event subsurface conditions cause
a cratering or shifting of the location surface, or if seabed conditions prove unsatisfactory to properly support the rig during
marine operations hereunder, and loss or damage to the rig or its associated equipment results therefrom, Operator shall, without
regard to other provisions of this Contract, including

Subparagraph
14.1 hereof, reimburse Contractor for all such loss or damage including removal of debris and payment of Force Majeure Rate during
repair and/or demobilization if applicable.

 

11.      EQUIPMENT
CAPACITY

 

Operations
shall not be attempted under any conditions which exceed the capacity of the equipment specified to be used hereunder or where
canal or water depths are in excess of N/A       feet. Without prejudice to the provisions
of Paragraph 14 hereunder, Contractor shall have the right to make the final decision as to when an operation or attempted operation
would exceed the capacity of specified equipment.

 

12.      TERMINATION
OF LOCATION LIABILITY:

 

When
Contractor has concluded operations at the well location, Operator shall thereafter be liable for damage to property, personal
injury or death of any person which occurs as a result of conditions of the location and Contractor shall be relieved of such
liability; provided, however, if Contractor shall subsequently reenter upon the location for any reason, including removal of
the rig, any term of the Contract relating to such reentry activity shall become applicable during such period.

 

13.      INSURANCE

 

During
the life of this Contract, Contractor shall at Contractor's expense maintain, with an insurance company or companies authorized
to do business in the state where the work is to be performed or through a self-insurance program, insurance coverages of the
kind and in the amount set forth in Exhibit "A", insuring the liabilities specifically assumed by Contractor in Paragraph
14 of this Contract. Contractor shall procure from the company or companies writing said insurance a certificate or certificates
that said insurance is in full force and effect and that the same shall not be canceled or materially changed without ten (10)
days prior written notice to Operator. For liabilities assumed hereunder by Contractor, its insurance shall be endorsed to provide
that the underwriters waive their right of subrogation against Operator. Operator will, as well, cause its insurer to waive subrogation
against Contractor for liability it assumes and shall maintain, at Operator's expense, or shall self insure, insurance coverage
as set forth in Exhibit “A” of the same kind and in the same amount as is required of Contractor, insuring the liabilities
specifically assumed by Operator in Paragraph 14 of this Contract. Operator shall procure from the company or companies writing
said insurance a certificate or certificates that said insurance is in full force and effect and that the same shall not be canceled
or materially changed without ten (10) days prior written notice to Contractor. Operator and Contractor shall cause their respective
underwriters to name the other additionally insured but only to the extend of the indemnification obligations assumed herein.

 

14.      RESPONSIBILITY
FOR LOSS OR DAMAGE, INDEMNITY, RELEASE OF LIABILITY AND ALLOCATION OF RISK:

 

14.1Contractor's
Surface Equipment: Contractor shall assume liability at all times for damage to or destruction of Contractor's surface equipment,
regardless of when or how such damage or destruction occurs, and Contractor shall release Operator of any liability for any such
loss, except loss or damage under the provisions of Paragraph 10 or Subparagraph 14.3.

 

14.2      Contractor's
In-Hole Equipment: Operator shall assume liability at all times for damage to or destruction of Contractor's in-hole equipment,
including, but not limited to, drill pipe, drill collars, and tool joints, and Operator shall reimburse Contractor for the value
of any such loss or damage; the value to be determined by agreement between Contractor and Operator as current repair costs or
100*       percent of current new replacement cost of such equipment delivered to the well
site.*or equipment of like kind acceptable to Contractor and Operator.

 

14.3      Contractor's
Equipment - Environmental Loss or Damage: Notwithstanding the provisions of Subparagraph 14.1 above, Operator shall assume liability
at all times for damage to or destruction of Contractor's equipment resulting from the presence of H2S, CO2
or other corrosive elements that enter the drilling fluids from subsurface formations or the use of corrosive, destructive or
abrasive additives in the drilling fluids.

 

14.4      Operator's
Equipment: Operator shall assume liability at all times for damage to or destruction of Operator's or its co-venturers’,
co-lessees’ or joint owners’ equipment, including, but not limited to, casing, tubing, well head equipment, and platform
if applicable, regardless of when or how such damage or destruction occurs, and Operator shall release Contractor of any liability
for any such loss or damage.

 

14.5      The
Hole: In the event the hole should be lost or damaged, Operator shall be solely responsible for such damage to or loss of the
hole, including the casing therein. Operator shall release Contractor and its suppliers, contractors and subcontractors of any
tier of any liability for damage to or loss of the hole, and shall protect, defend and indemnify Contractor and its suppliers,
contractors and subcontractors of any tier from and against any and all claims, liability, and expense relating to such damage
to or loss of the hole.

 

14.6      Underground
Damage: Operator shall release Contractor and its suppliers, contractors and subcontractors of any tier of any liability for,
and shall protect defend and indemnify Contractor and its suppliers, contractors and subcontractors of any tier from and against
any and all claims, liability, and expense resulting fro operations under this Contract on account of injury to, destruction of,
or loss or impairment of any property right in or to oil, gas, or other mineral substance or water, I at the time of the act or
omission causing such injury, destruction, loss, or impairment, said substance had not been reduced to physical possession above
the surface of the earth, and for any loss or damage to any formation, strata, or reservoir beneath the surface of the earth.

 

14.7
Inspection of Materials Furnished by Operator: Contractor agrees to visually inspect all materials furnished by Operator before
using same and to notify Operator of any apparent defects therein. Contractor shall not be liable for any loss or damage resulting
from the use of materials furnished by Operator, and Operator shall release Contractor from , and shall protect, defend and indemnify
Contractor from and against, any such liability.

 

14.8      Contractor's
Indemnification of Operator: Contractor shall release Operator of any liability for, and shall protect, defend and indemnify Operator
from and against all claims, demands, and causes of action of every kind and character, without limit and without regard to the
cause or causes thereof or the negligence o any party or parties, arising in connection herewith in favor of Contractor's employees
or Contractor's subcontractors of any tier (inclusive of any agent or consultant engaged by Contractor) or their employees, or
Contractor's invitees, on account of bodily injury, death or damage to property. Contractor's indemnity under this Paragraph shall
be without regard to and without any right to contribution from any insurance maintained by Operator pursuant to Paragraph 13.
If it is judicially determined that the monetary limits of insurance required hereunder or of the indemnities voluntarily assumed
under Subparagraph 14.8 (which Contractor and Operator hereby agree will be supported either by available liability insurance,
under which the insurer has no right of subrogation against the indemnities, or voluntarily self-insured, in part or whole) exceed
the maximum limits permitted under applicable law, it is agreed that said insurance requirements or indemnities shall automatically
be amended to conform to the maximum monetary limits permitted under such law.

 

	(U.S. Daywork Contract -
    Page 4)	Form
    provided by Forms On-A-Disk
	Copyright
    © 2003 International Association of Drilling Contractors	(214)
    340-9429  
    FormsOnADisk.com

 

    	 

    	 

    

 

 Revised April, 2003

 

14.9      Operator's
Indemnification of Contractor: Operator shall release Contractor of any liability for, and shall protect, defend and indemnify
Contractor from and against all claims, demands, and causes of action of every kind and character, without limit and without regard
to the cause or causes thereof or the negligence of any party or parties, arising in connection herewith in favor of Operator's
employees or Operator's contractors of any tier (inclusive of any agent, consultant or subcontractor engaged by Operator) or their
employees, or Operator's invitees, other than those parties identified in Subparagraph 14.8 on account of bodily injury, death
or damage to property. Operator's indemnity under this Paragraph shall be without regard to and without any right to contribution
from any insurance maintained by Contractor pursuant to Paragraph 13. If it is judicially determined that the monetary limits
of insurance required hereunder or of the indemnities voluntarily assumed under Subparagraph 14.9 (which Contractor and Operator
hereby agree will be supported either by available liability insurance, under which the insurer has no right of subrogation against
the indemnitees, or voluntarily self-insured, in part or whole) exceed the maximum limits permitted under applicable law, it is
agreed that said insurance requirements or indemnities shall automatically be amended to conform to the maximum monetary limits
permitted under such law.

 

14.10
Liability for Wild Well: Operator shall be liable for the cost of regaining control of any wild well, as well as for cost of removal
of any debris and cost of property remediation and restoration, and Operator shall release, protect, defend and indemnify Contractor
and its suppliers, contractors and subcontractors of any tier from and against any liability for such cost.

 

14.11
Pollution or Contamination: Notwithstanding anything to the contrary contained herein, except the provisions of Paragraphs 10
and 12, it is understood and agreed by and between Contractor and Operator that the responsibility for pollution or contamination
shall be as follows:

 

(a)
Contractor shall assume all responsibility for, including control and removal of, and shall protect, defend and indemnify Operator
from and against all claims, demands and causes of action of every kind and character arising from pollution or contamination,
which originates above the surface of the land or water from spills of fuels, lubricants, motor oils, pipe dope, paints, solvents,
ballast, bilge and garbage, except unavoidable pollution from reserve pits, wholly in Contractor's possession and control and
directly associated with Contractor's equipment and facilities.

 

(b)
Operator shall assume all responsibility for, including control and removal of, and shall protect, defend and indemnify Contractor
and its suppliers, contractors and subcontractors of any tier from and against all claims, demands, and causes of action of every
kind and character arising directly or indirectly from all other pollution or contamination which may occur during the conduct
of operations hereunder, including, but not limited to, that which may result from fire, blowout, cratering, seepage or any other
uncontrolled flow of oil, gas, water or other substance, as well as the use or disposition of all drilling fluids, including,
but not limited to, oil emulsion, oil base or chemically treated drilling fluids, contaminated cuttings or cavings, lost circulation
and fish recovery materials and fluids. Operator shall release Contractor and its suppliers, contractors and subcontractors of
any tier of any liability for the foregoing.

 

(c)
In the event a third party commits an act or omission which results in pollution or contamination for which either Contractor
or Operator, for whom such party is performing work, is held to be legally liable, the responsibility therefor shall be considered,
as between Contractor and Operator, to be the same as if the party for whom the work was performed had performed the same and
all of the obligations respecting protection, defense, indemnity and limitation of responsibility and liability, as set forth
in (a) and (b) above, shall be specifically applied.

 

14.12
Consequential Damages: Subject to and without affecting the provisions of this Contract regarding the payment rights and obligations
of the parties or the risk of loss, release and indemnity rights and obligations of the parties, each party shall at all times
be responsible for and hold harmless and indemnify the other party from and against its own special, indirect or consequential
damages, and the parties agree that special, indirect or consequential damages shall be deemed to include, without limitation,
the following: loss of profit or revenue; costs and expenses resulting from business interruptions; loss of or delay in production;
loss of or damage to the leasehold; loss of or delay in drilling or operating rights; cost of or loss of use of property, equipment,
materials and services, including without limitation those provided by contractors or subcontractors of every tier or by third
parties. Operator shall at all times be responsible for and hold harmless and indemnify Contractor and its suppliers, contractors
and subcontractors of any tier from and against all claims, demands and causes of action of every kind and character in connection
with such special, indirect or consequential damages suffered by Operator’s co-owners, co-venturers, co-lessees, farmors,
farmees, partners and joint owners.

 

14.13
Indemnity Obligation: Except as otherwise expressly limited in this Contract, it is the intent of parties hereto that all releases,
indemnity obligations and/or liabilities assumed by such parties under terms of this Contract, including, without limitation,
Subparagraphs 4.9 and 6.3(c), Paragraphs 10 and 12, and Subparagraphs 14.1 through 14.12 hereof, be without limit and without
regard to the cause or causes thereof, including, but not limited to, pre-existing conditions, defect or ruin of premises or equipment,
strict liability, regulatory or statutory liability, products liability, breach of representation or warranty (express or implied),
breach of duty (whether statutory, contractual or otherwise) any theory of tort, breach of contract, fault, the negligence of
any degree or character (regardless of whether such negligence is sole, joint or concurrent, active, passive or gross) of any
party or parties, including the party seeking the benefit of the release, indemnity or assumption of liability, or any other theory
of legal liability. The indemnities, and releases and assumptions of liability extended by the parties hereto under the provisions
of Subparagraphs 4.9 and 6.3 and Paragraphs 10, 12 and 14 shall inure to the benefit of such parties, their co-venturers, co-lessees,
joint owners, their parent, holding and affiliated companies and the officers, directors, stockholders, partners, managers, representatives,
employees, consultants, agents, servants and insurers of each. Except as otherwise provided herein, such indemnification and assumptions
of liability shall not be deemed to create any rights to indemnification in any person or entity not a party to this Contract,
either as a third party beneficiary or by reason of any agreement of indemnity between one of the parties hereto and another person
or entity not a party to this Contract.

 

15.   AUDIT

 

If
any payment provided for hereunder is made on the basis of Contractor's costs, Operator shall have the right to audit Contractor's
books and records relating to such costs. Contractor agrees to maintain such books and records for a period of two (2) years from
the date such costs were incurred and to make such books and records readily available to Operator at any reasonable time or times
within the period.

 

16.  NO
WAIVER EXCEPT IN WRITING

 

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

 

17.  FORCE
MAJEURE

 

Except
as provided in this Paragraph 17 and without prejudice to the risk of loss, release and indemnity obligations under this Contract,
each party to this Contract shall be excused from complying with the terms of this Contract, except for the payment of monies
when due, if and for so long as such compliance is hindered or prevented by a Force Majeure Event. As used in this Contract, "Force
Majeure Event" includes: acts of God, action of the elements, wars (declared or undeclared), insurrection, revolution, rebellions
or civil strife, piracy, civil war or hostile action, terrorist acts, riots, strikes, differences with workmen, acts of public
enemies, federal or state laws, rules, regulations dispositions or orders of any governmental authorities having jurisdiction
in the premises or of any other group, organization or informal association (whether or not formally recognized as a government),
inability to procure material, equipment, fuel or necessary labor in the open market, acute and unusual labor or material, equipment
or fuel shortages, or any other causes (except financial) beyond the control of either party. Neither Operator nor Contractor
shall be required against its will to adjust any labor or similar disputes except in accordance with applicable law. In the event
that either party hereto is rendered unable, wholly or in part, by any of these causes to carry out its obligation under this
Contract, it is agreed that such party shall give notice and details of Force Majeure in writing to the other party as promptly
as possible after its occurrence. In such cases, the obligations of the party giving the notice shall be suspended during the
continuance of any inability so caused except that Operator shall be obligated to pay to Contractor the Force Majeure Rate provided
for in Subparagraph 4.8 above.

 

	(U.S.
    Daywork Contract - Page 5)	Form provided
    by Forms On-A-Disk
	Copyright © 2003
    International Association of Drilling Contractors	(214) 340-9429  
    FormsOnADisk.com

 

    	 

    	 

    

 

Revised April, 2003

 

18.      GOVERNING
LAW:

 

This
Contract shall be construed, governed, interpreted, enforced and litigated, and the relations between the parties determined in
accordance with the laws of Louisiana      .

 

19.  INFORMATION
CONFIDENTIAL:

 

Upon
written request by Operator, information obtained by Contractor in the conduct of drilling operations on this well, including,
but not limited to, depth, formations penetrated, the results of coring, testing and surveying, shall be considered confidential
and shall not be divulged by Contractor or its employees, to any person, firm, or corporation other than Operator's designated
representatives.

 

20.  SUBCONTRACTS:

 

Either
party may employ other contractors to perform any of the operations or services to be provided or performed by it according to
Exhibit "A".

 

21.  ATTORNEY'S
FEES

 

If
this Contract is placed in the hands of an attorney for collection of any sums due hereunder, or suit is brought on same, or sums
due hereunder are collected through bankruptcy or arbitration proceedings, then the prevailing party shall be entitled to recover
reasonable attorney's fees and costs.

 

22.  CLAIMS
AND LIENS:

 

Contractor
agrees to pay all valid claims for labor, material, services, and supplies to be furnished by Contractor hereunder, and agrees
to allow no lien by such third parties to be fixed upon the lease, the well, or other property of the Operator or the land upon
which said well is located.

 

23.  ASSIGNMENT:

 

Neither
party may assign this Contract without the prior written consent of the other, and prompt notice of any such intent to assign
shall be given to the other party. In the event of such assignment. the assigning party shall remain liable to the other party
as a guarantor of the performance by the assignee of the terms of this Contract. If any assignment is made that materially alters
Contractor's financial burden, Contractor's compensation shall be adjusted to give effect to any increase or decrease in Contractor's
operating costs.

 

24.  NOTICES
AND PLACE OF PAYMENT:

 

Notices,
reports, and other communications required or permitted by this Contract to be given or sent by one party to the other shall be
delivered by hand, mailed, digitally transmitted or telecopied to the address hereinabove shown. All sums payable hereunder to
Contractor shall be payable at its address hereinabove shown unless otherwise specified herein.

 

25.  CONTINUING
OBLIGATIONS:

 

Notwithstanding
the termination of this Contract, the parties shall continue to be bound by the provisions of this Contract that reasonably require
some action or forbearance after such termination.

 

26.  ENTIRE
AGREEMENT:

 

This
Contract constitutes the full understanding of the parties, and a complete and exclusive statement of the terms of their agreement,
and shall exclusively control and govern all work performed hereunder. All representations, offers, and undertakings of the parties
made prior to the effective date hereof, whether oral or in writing, are merged herein, and no other contracts, agreements or
work orders, executed prior to the execution of this Contract, shall in any way modify, amend, alter or change any of the terms
or conditions set out herein.

 

27.  SPECIAL
PROVISIONS:

 

27.1
Drilling Equipment Limits: Operator understands and accepts that Contractor’s policy is to not exceed more than 80%
of the manufacturer’s rated capacity.

 

This
includes but is not limited to lifting limits, RPM and pressure limits.

 

27.2
Prior to Contractor moving its rig to Operators location, Operator will have in place with a bank suitable to Contractor,
an escrow agreement in an amount equal to the mobilization and daywork.

 

27.3
For the work described herein, this contract will supersede any Master Service Agreement or other contracts between Contractor
and Operator.

 

28.  ACCEPTANCE
OF CONTRACT:

 

The
foregoing Contract, including the provisions relating to indemnity, release of liability and allocation of risk of Subparagraphs
4.9 and 6.3(c), Paragraphs 10 and 12, and Subparagraphs 14.1 through 14.12, is acknowledged, agreed to and accepted by Operator
this        day of                     ,
20            .

 

	OPERATOR:	E
    & P Co, LLC
	By:	 
	Title:	

 

The
foregoing Contract, including the provisions relating to indemnity, release of liability and allocation of risk of Subparagraphs
4.9, 6.3(c), Paragraphs 10 and 12, and Subparagraphs 14.1 through 14.12, is acknowledged, agreed to and accepted by Contractor
this       31st       day of           January      ,
20      14      , which is the effective date of this Contract,
subject to rig availability, and subject to all of its terms and provisions, with the understanding that it will not be binding
upon Operator until Operator has noted its acceptance, and with the further understanding that unless said Contract is thus executed
by Operator within        5       days of the above date Contractor
shall be in no manner bound by its signature thereto.

 

	CONTRACTOR:	Justiss
    Oil Company, Inc.
	By:	 
	Title:	 

 

 

	(U.S.
    Daywork Contract - Page 6)	Form provided
    by Forms On-A-Disk
	Copyright © 2003
    International Association of Drilling Contractors	(214) 340-9429  
    FormsOnADisk.com

 

    	 

    	 

    

 

 Revised April, 2003

 

EXHIBIT
"A"

 

To Daywork Contract dated             January
31      , 2014    

 

Operator            E
& P Co, LLC                                      
Contractor           Justiss Oil Company, Inc.                                   

 

Well Name and Number IP CO SWD
#2                                                                                                                                  

 

SPECIFICATIONS
AND SPECIAL PROVISIONS

 

1. CASING PROGRAM (See Paragraph
7)                     Operator
furnished

 

	 	 	Hole

        Size
	 	 	Casing

        Size
	 	 	Weight	 	 	Grade	 	Approximate

Setting Depth	 	Wait
    on Cement

Time	 
	Conductor	 	 	in.	 	14	in.	 	 	lbs/ft.	 	 	 	100	ft.	 	hrs
	Surface	 	12-1/4	in.	 	8-5/8	in.	 	24	lbs/ft.	 	J-55	 	1310	ft.	N/A	hrs
	Protection	 	 	in.	 	 	in.	 	 	lbs/ft.	 	 	 	 	ft.	 	hrs
	 	 	 	in.	 	 	in.	 	 	lbs/ft.	 	 	 	 	ft.	 	hrs
	Production	 	7-7/8	in.	 	5-1/2	in.	 	15.5	lbs/ft.	 	J-55	 	2300	ft.	N/A	hrs
	Liner	 	 	in.	 	 	in.	 	 	lbs/ft.	 	 	 	 	ft.	 	hrs
	 	 	 	in.	 	 	in.	 	 	lbs/ft.	 	 	 	 	ft.	 	hrs

 

2. MUD CONTROL PROGRAM (See
Subparagraph 8.2)      Operator furnished for good well control

 

	Depth
        Interval

        (ft)
	 	 	 	 

         

        Weight

        (lbs./gal.)
	 	 

         

        Viscosity

        (Secs)
	 	 

         

        Water
        Loss

        (cc)

	From	 	To	 	Type
    Mud	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	0	 	1310	 	Water
    based	 	9.1	 	N/A	 	NC
	1310	 	TD	 	Water
    based	 	9.4	 	N/A	 	NC
	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 

 

Other mud specifications: ____________________________________________________________________________

	  
	  
	  
	  

 

3. INSURANCE (See Paragraph
13)

 

		3.1	Adequate
                                         Workers' Compensation Insurance complying with State Laws applicable or Employers' Liability
                                         Insurance with limits of $      1,000,000.00 covering
                                         all of Contractor's employees working under this Contract.

 

		3.2	Commercial
                                         (or Comprehensive) General Liability Insurance, including contractual obligations as
                                         respects this Contract and proper coverage for all other obligations assumed in this
                                         Contract. The limit shall be $      1,000,000.00      
                                         combined single limit per occurrence for Bodily Injury and Property Damage.

 

3.3           Automobile
Public Liability Insurance with limits of $      1,000,000.00      
for the death or injury of each person and $      1,000,000.00      
for each accident; and Automobile Public Liability Property Damage Insurance with limits of $      1,000,000.00      
for each accident. (combined)

 

3.4           In
the event operations are over water, Contractor shall carry in addition to the Statutory Workers' Compensation Insurance, endorsements
covering liability under the Longshoremen's & Harbor Workers' Compensation Act and Maritime liability including maintenance
and cure with limits of $      N/A       for each death or
injury to one person and $       N/A       for any one accident.

 

3.5           Other
insurance: ___

	  	 
	 	 

 

4. EQUIPMENT, MATERIALS AND
SERVICES TO BE FURNISHED BY CONTRACTOR:

 

The
machinery, equipment, tools, materials, supplies, instruments, services and labor hereinafter listed, including any transportation
required for such

items, shall be provided at the
well location at the expense of Contractor unless otherwise noted by this Contract.

 

4.1      Drilling
Rig

 

      Complete
drilling rig, designated by Contractor as its Rig No.         64      ,
the major items of equipment being:

 

Drawworks: Make and Model See
attached rig inventory                                                                                                                        

 

Engines: Make, Model, and H.P.______________________________________________________________________

 

No. on Rig __________________________________________________________________________________

 

Pumps:      No.
1 Make, Size, and Power _________________________________________________________________

 

No. 2 Make, Size,
and Power ____________________________________________________________________

 

Mud Mixing Pump: Make, Size, and
Power _______________________________________________________________

 

Boilers: Number, Make, H.P. and
W.P. __________________________________________________________________

 

Derrick or Mast: Make, Size, and
Capacity _______________________________________________________________

 

Substructure: Size and Capacity
_______________________________________________________________________

 

Rotary Drive: Type ________________________________________________________________________________

 

Drill Pipe: Size     
                   in.                      
ft.; Size:                      
in.                     
ft.

 

Drill Collars: Number and Size ________________________________________________________________________

 

	(U.S. Daywork Contract - “Exhibit B” - Page 1)	Form provided by Forms On-A-Disk
	Copyright © 2003 International Association of Drilling Contractors	(214) 340-9429   FormsOnADisk.com

 

    	 

    	 

    

 

Revised April, 2003 

 

Blowout Preventers: ______________________________________________________________________________

 

	Size	 	Series
    or Test Pr.	 	Make
    & Model	 	Number
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	B.O.P.
    Closing Unit:	 	 
	B.O.P.
    Accumulator:	 	 

 

4.2      Derrick
timbers.

4.3      Normal
strings of drill pipe and drill collars specified above.

4.4      Conventional
drift indicator.

4.5      Circulating
mud pits.

4.6      Necessary
pipe racks and rigging up material.

4.7

4.8      Shale Shaker.

4.9      _________________________________________________________________________________________

4.10    _________________________________________________________________________________________

4.11    _________________________________________________________________________________________

4.12    _________________________________________________________________________________________

4.13    _________________________________________________________________________________________

4.14    _________________________________________________________________________________________

4.15    _________________________________________________________________________________________

4.16    _________________________________________________________________________________________

4.17    _________________________________________________________________________________________

 

5. EQUIPMENT,
MATERIALS AND SERVICES TO BE FURNISHED BY OPERATOR:

 

The
machinery, equipment, tools, materials, supplies, instruments, services and labor hereinafter listed, including any
transportation required for such items, shall be provided at the well location at the expense of Operator unless otherwise
noted by this Contract.

 

		5.1	Furnish and maintain adequate
                                         roadway and/or canal to location, right-of-way, including rights-of-way for fuel and
                                         water lines, river crossings, highway crossings, gates and cattle guards.

		5.2	Stake
                                         location, clear and grade location, and provide turnaround, including surfacing when
                                         necessary.

		5.3	Test
                                         tanks with pipe and fittings.

		5.4	Mud
                                         storage tanks with pipe and fittings.

		5.5	Separator
                                         with pipe and fittings.

		5.6	Labor
                                         and materials to connect and disconnect mud tank, test tank, and mud gas separator.

		5.7	Labor
                                         to disconnect and clean test tanks and mud gas separator.

		5.8	Drilling
                                         mud, chemicals, lost circulation materials and other additives.

		5.9	Pipe
                                         and connections for oil circulating lines.

		5.10	Labor
                                         to lay, bury and recover oil circulating lines.

		5.11	Drilling
                                         bits, reamers, reamer cutters, stabilizers and special tools.

		5.12	Contract
                                         fishing tool services and tool rental.

		5.13	Wire
                                         line core bits or heads, core barrels and wire line core catchers if required.

		5.14	Conventional
                                         core bits, core catchers and core barrels.

		5.15	Diamond
                                         core barrel with head.

		5.16	Cement
                                         and cementing service.

		5.17	Electrical
                                         wireline logging services.

		5.18	Directional,
                                         caliper, or other special services.

		5.19	Gun
                                         or jet perforating services.

		5.20	Explosives
                                         and shooting devices.

		5.21	Formation
                                         testing, hydraulic fracturing, acidizing and other related services.

		5.22	Equipment
                                         for drill stem testing.

		5.23	Mud
                                         logging services.

		5.24	Sidewall
                                         coring service.

		5.25	Welding service for welding
                                         bottom joints of casing, guide shoe, float shoe, float collar and in connection with
                                         installing of well head equipment if required.

		5.26	Casing,
                                         tubing, liners, screen, float collars, guide and float shoes and associated equipment.

		5.27	Casing
                                         scratchers and centralizers.

		5.28	Well head connections
                                         and all equipment to be installed in or on well or on the premises for use in connection
                                         with testing, completion and operation of well.

		5.29	Special
                                         or added storage for mud and chemicals.

		5.30	Casinghead,
                                         API series, to conform to that shown for the blowout preventers specified in Subparagraph
                                         4.1 above.

		5.31	Blowout
                                         preventer testing packoff and testing services.

		5.32	Replacement
                                         of BOP rubbers, elements and seals, if required, after initial test

		5.33	Casing
                                         Thread Protectors and Casing Lubricants.

		5.34	H2S
                                         training and equipment as necessary or as required by law.

5.35      Site
septic systems.

5.36      _________________________________________________________________________________________

5.37      _________________________________________________________________________________________

5.38      _________________________________________________________________________________________

5.39      _________________________________________________________________________________________

5.40      _________________________________________________________________________________________

5.41      _________________________________________________________________________________________

5.42      _________________________________________________________________________________________

5.43      _________________________________________________________________________________________

5.44      _________________________________________________________________________________________

5.45      _________________________________________________________________________________________

5.46      _________________________________________________________________________________________

5.47      _________________________________________________________________________________________

5.48      _________________________________________________________________________________________

5.49      _________________________________________________________________________________________

5.50      _________________________________________________________________________________________

 

	(U.S. Daywork Contract - “Exhibit B” - Page 2)	Form provided by Forms On-A-Disk
	Copyright © 2003 International Association of Drilling Contractors	(214) 340-9429   FormsOnADisk.com

 

    	 

    	 

    

 

Revised April, 2003

 

6.      EQUIPMENT,
MATERIALS AND SERVICES TO BE FURNISHED BY DESIGNATED PARTY:

 

The
machinery, equipment, tools, materials, supplies, instruments, services, and labor listed as the following numbered items, including
any transportation required for such items unless otherwise specified, shall be provided at the well location and at the expense
of the party hereto as designated by an X mark in the appropriate column.

 

	 	 	To
        Be Provided By and

        At
        The Expense Of

	 	Item	Operator	 	Contractor
	6.1	Cellar
    and Runways	 X	 	 
	6.2	Ditches
    and sumps	 X
    	 	 
	6.3	Fuel
    (located at     rig      )	 X	 	 
	6.4	Fuel
    Lines (length       on location      )	 	 	 X
	6.5	Water
    at source, including required permits	 X	 	 
	6.6	Water
    well, including required permits	 X	 	 
	6.7	Water
    lines, including required permits	 X	 	 
	6.8	Water
    storage tanks      380bbl       capacity rig tank	 	 	 X
	6.9	Potable
    water	 X	 	 
	6.10	Labor
    to operate water well or water pump	 	 	 X
	6.11	Maintenance
    of water well, if required	 X	 	 
	6.12	Water
    Pump (down hole electric)	 X	 	 
	6.13	Fuel
    for water pump	 X	 	 
	6.14	Mats
    for substructure	 	 	 X
	6.15	Transportation
    of Contractor's property:	 	 	 
	 	Move
    in See page 1, paragraph 4.1	 	 	 X
	 	Move
    out	 	 	 X
	6.16	Materials
    for "boxing in" rig and derrick	 	 	 X
	6.17	Special
    strings of drill pipe and drill collars as follows:	 	 	 
	 	Other
    than with rig inventory	 	 X	 	 
	 	 	 	 N/A	 	 N/A
	 	 	 	 N/A	 	 N/A
	6.18

         
	Kelly
    joints, subs, elevators, tongs, slips and BOP rams for use with special drill pipe	 X	 	 
	6.19	Drill
    pipe protectors for Kelly joint and each joint

    of drill pipe running inside of Surface Casing as required,

    for use with normal strings of drill pipe	 X	 	 
	6.20	Drill
    pipe protectors for Kelly joint and drill pipe running

    inside of Protection Casing	 X	 	 
	6.21	Rate
    of penetration recording device (4 pen)	 	 	 X
	6.22	Extra
    labor for running and cementing casing (Casing crews)	 X	 	 
	6.23	Casing
    tools	 X	 	 
	6.24	Power
    casing tongs	 X	 	 
	6.25	Laydown
    and pickup machine	 X	 	 
	6.26	Tubing
    tools	 X	 	 
	6.27	Power
    tubing tong	 X	 	 
	6.28	Crew
    Boats, Number	 N/A	 	 N/A
	6.29	Service
    Barge	 N/A	 	 N/A
	6.30	Service
    Tug Boat	 N/A	 	 N/A
	6.31	Rat
    Hole	 X	 	 
	6.32	Mouse
    Hole	 X	 	 
	6.33	Reserve
    Pits	 X	 	 
	6.34	Upper
    Kelly Cock	 N/A	 	 N/A
	6.35	Lower
    Kelly Valve	 	 	 X
	6.36	Drill
    Pipe Safety Valve	 	 	 X
	6.37	Inside
    Blowout Preventer	 	 	 X
	6.38	Drilling
    hole for or driving for conductor pipe	 X	 	 
	6.39	Charges,
    cost of bonds for public roads	 X	 	 
	6.40	Portable
    Toilet	 X	 	 
	6.41	Trash
    Receptacle	 X	 	 
	6.42	Elliptical
    Motion Shale Shaker	 	 	 X
	6.43	Shale
    Shaker Screens	 X	 	 
	6.44	Mud
    Cleaner	 X	 	 
	6.45	Mud/Gas
    Separator	 	 	 X
	6.46	Desander	 	 	 X
	6.47	Desilter	 N/A	 	 N/A
	6.48	Degasser	 N/A	 	 N/A
	6.49	Centrifuge	 X	 	 
	6.50	Rotating
    Head	 X	 	 
	6.51	Rotating
    Head Rubbers	 X	 	 
	6.52	Hydraulic
    Adjustable Choke	 X	 	 
	6.53	Pit
    Volume Totalizer	 X	 	 
	6.54	Communication,
    type     telephone for Contractor use	 	 	 X
	6.55	Forklift,
    capacity	 X	 	 
	6.56	Corrosion
    Inhibitor for protecting drill string	 X	 	 
	6.57	 	 	 	 	 
	6.58	 	 	 	 	 
	6.59	 	 	 	 	 
	6.60	 	 	 	 	 

 

	(U.S.
    Daywork Contract - “Exhibit B” - Page  3 )	Form provided by Forms On-A-Disk
	Copyright © 2003 International Association of Drilling Contractors	(214) 340-9429   FormsOnADisk.com

 

    	 

    	 

    

 

 Revised April, 2003

 

7.      OTHER
PROVISIONS:

 

 

EXHIBIT "B"

 

(See Subparagraph
8.3)

 

The following clauses, when required
by law, are incorporated in the Contract by reference as if fully set out:

 

(1)      The
Equal Opportunity Clause prescribed in 41 CFR 60-1.4.

 

(2)      The
Affirmative Action Clause prescribed in 41 CFR 60-250.4 regarding veterans and veterans of the Vietnam era.

 

(3)      The
Affirmative Action Clause for handicapped workers prescribed in 41 CFR 60-741.4.

 

(4)      The
Certification of Compliance with Environmental Laws prescribed in 40 CFR 15.20.

 

SIGNED FOR OPERATOR: ____________________________________.

 

SIGNED FOR CONTRACTOR: _________________________________.

 

	(U.S. Daywork Contract - “Exhibit B” - Page 4)	Form provided by Forms On-A-Disk
	Copyright © 2003 International Association of Drilling Contractors	(214) 340-9429   FormsOnADisk.com

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00228-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00228-of-00352.parquet"}]]