DRAFT BIDDING AGREEMENT OR BID GROUP AGREEMENT BETWEEN

ABC

AND

XYZ COMPANY

FOR -------------------------------------------

THIS AGREEMENT is entered into on thisday of the 2009, BY AND BETWEEN ABC, a company incorporated under the laws of --------------------------- having its Registered Office at ------------------------------------- (hereinafter referred to as A) which expression shall, unless repugnant to the context or contrary to the meaning thereof, includes its successors and permitted assignees of the First Part. AND XYZ Company, a Company incorporated under the laws of ----------------- having its Registered Office at (hereinafter referred to as ..) which expression shall, unless repugnant to the context or contrary to the meaning thereof, includes its successors and permitted Assignees, of the Second Part WHEREAS: a) b) c) d) The Government has invited bids for conducting -------------------------The Parties are desirous of making the bid for ------------------------------------The parties are desirous of entering into this Agreement for the purposes of laying down the basis of sharing costs, risk expenses and investment related to the making of bid. The Parties agree that upon entering into this Agreement they will discuss and decide the future strategy for proceeding further and that they will enter into further definitive agreements as may be required from time to time in this regard. NOW IT IS HEREBY AGREED AS FOLLOWS: 1. 1.1 A. Definitions: The terms defined in the recitals hereof or at other instances herein shall have the meaning attributed to them thereby. In addition, the following words and expression shall, for the purposes of this Agreement, bear the meanings respectively ascribed to them; Affiliate means in relation to any party; a) b) c) A company or other legal entity directly or indirectly controlled by that Party, A company or other legal entity which controls directly or indirectly. That party, or a company or other legal entity directly or indirectly controlled by a company or other entity which controls directly or indirectly that party. A company or other legal entity shall be considered as controlled by another company or other entity if the later owns directly or indirectly, fifty percent or more of the shares or voting rights of in the company. d) e) Application means bid to be submitted or submitted to the Government /bid inviting agency. Application Costs means all actual, reasonable, and necessary costs and expenses incurred in the preparations and submission of an Application, including, but not limited to, transportation, living, communication, courier, and reproductions costs, consultant fees with prior approval of the Parties, and wages and salaries of personnel directly engaged in or attributable to such work at agreed rates. f) g) h) i) Application Date means that last date on which any Application is due, or such extended date as may be notified by the Government . Block means the area as given in exhibit A in relation to which an Application shall be made by the Parties to the Govt. for obtaining Petroleum exploration and exploitation rights pursuant to the Agreement. Business Day means a day on which the banks in London and Amsterdam are open for business. Commercial Terms means a set of the minimum exploration work and fiscal terms, conditions, and commitments which a Party proposals for the purposes of determining the terms of an Application. Such limits, and other similar terms. j) k) l) m) n) Company Personnel means any person functioning as director or officer of a Party. Defaulting Party means a Party failing to pay its share of the costs and expenses under the terms of the Agreement. Effective Date is the date first set forth on page one of the Agreement. Government means the Government of India. Contract means the Production Sharing Contract concluded with the Government as a result of Application. fiscal terms, conditions, and commitments may include, but shall not necessarily be limited to bonuses, production sharing, production pricing, cost oil

o) p)

Joint Operating Agreement means and Operating Agreement into which parties may enter for conducting joint operations in the Block. Negotiations Costs means all actual reasonable and necessary costs and expenses incurred after the Application Date in negotiating the Contract, including, but not limited to, transportation, living, communication, courier, and reproduction costs, consultant fee with prior approval of the Parties, and wages and salaries of personnel directly engaged in or attributable to such work at agreed rates.

q)

Notice means a writing in English and delivered in person or by registered mail or by courier service or by any electronic means transmitting written communication which provides confirmation of complete transmission addressed to Party or Parties.

r) s) t) u)

Participating Interest means the undivided interest expressed as a percentage held by a Party in and to all rights, privileges, benefits, obligations and liabilities in and under the Agreement. Parties means a party to this Agreement. Team means an integrated team of Company Personnel taken from the Parties constituted for implementation of a specified work. Work means (I) a general geological, geophysical, engineering and/ or commercial evaluation of the Block (ii) the preparation and timely submission of all necessary forms to facilitate a legal application to the Government for the Block and (iii) the negotiation of the Contract.

1.2 1.3 2.

The headings in the Agreement are for convenience only and shall not be deemed to alter or affect the meaning or interpretation of any provision hereof. When the context requires, the singular shall include the plural and plural shall include the singulars. Work A. B. C. D. Parties shall carry out the Work together as an integrated Team on a joint and equal basis. Each Party shall designate in writing its representative as a member of the Team. Each Partys may appoint an alternate to act in place of its Representative. Technical presentations or progress to date reports shall be made jointly by the Parties at any of the Parties offices located in India or other mutually agreed locations at dates decided by the Parties. A shall co-ordinate activities of the various Team constituted from time to time for carrying out the Work.

3. 3.1 3.2 3.3 3.4 4.

Co-ordinating Committee For overall supervision and co-ordination or work there shall be constituted a Co-ordinating Committee within 10 days of the signing of this Agreement for taking appropriate decision. Each Party shall nominate two representatives, one of the representative of ABC shall act as Chairman and one of the representatives of XYZ as Secretary. The Co-ordinating Committee shall take decisions through unanimity. The Co-ordinating Committee shall take all actions which are required for proper conduct of the work. Disclosure of Information Parties shall freely exchange with each other any and all the information pertaining to the Block in their possession that would be

advantageous for making an Application and seeking Contract and which they are in a position to disclose without violating any governing confidentiality obligations or is not of a proprietary nature. 5. Standard of Conduct and Liability A. Parties shall perform the Work in a diligent, safe and efficient manner in accordance with good and prudent oil field practices generally followed by the international petroleum industry under similar circumstances, and in accordance with the provisions of the Agreement. B. Parties shall bear in proportion to their respective Participating Interests any and all cost, expenses and liabilities that arise out of or are incidental to any act or failure to act by either party or the conduct of the work or in connection with the Agreement. 6. A. Participating Interest of the Parties Parties shall have the following Participating Interests under the Agreement:

ABC

% %

XYZ Company: C.

The Participating Interests may be adjusted as provided hereunder, or as may otherwise be agreed by the Parties from time to time. No Party shall act as an agent, servant, or employee of the other Party The rights, duties, obligations and responsibilities of the Parties shall be several and not joint or collective and each Party shall be responsible only for its Participating Interest share of any costs and expenses incurred pursuant to the Agreement. It is not the intention of the parties to create, nor shall the Agreement be deemed or construed to create a mining or other partnership, association or trust, or creating fiduciary relationship. 7. Application Procedure. The Parties shall prepare a joint bid in close co-operation and co-ordination .Chairman shall hold meeting prior to the Application Date to finalise the Application. The Application shall be submitted jointly. 8. A. Application and Contract If in the course of processing any Application, Government requests the participating Parties to revise the Commercial Terms offered under such application, then the participating Parties shall endeavour to agree unanimously on a response to the proposed revision within the time frame allowed under the circumstances. If the participating Parties are unable to so agree, then the participating Party or Parties proposing the most competitive Commercial Terms may proceed with negotiations and the other Party or Parties who do not wish to accept such Commercial Terms shall withdraw from the Application. B. If Application is successful, the participating Parties thereto shall proceed to negotiate and, subject to the other terms hereof, execute a Contract. The Chairman shall act as the lead negotiator for the participating Parties to secure the participating Parties shall be entitled to be present at [and participate in] any such negotiations. C. Notwithstanding the foregoing, each participating Party shall be bound by and agree to execute the Contract containing the most competitive Commercial Terms and provisions substantially the same as the Model Production Sharing Contract or as otherwise agreed by the Govt. No participating party may withdraw from any Application in which such Party is participating or from this Agreement after an Application has been submitted to the Government. No party after withdrawal will submit a bid independently or in association with any other third party. 9. a) Costs Charging of Personnel Costs Employees, Officer and Directors of the Parties shall be spending time and money in connection with the subject matter of the Agreement. These expenses shall be charged on the basis of standard costs to be worked out by the Parties with mutual consent and will be different for personnel at different levels in the hierarchy of the organisation of the Parties. The monthly expense accounts prepared by Parties on the basis of these standard costs shall be consolidated by ABC and a Joint Account shall be prepared Joint Account shall mean the set of accounts to be maintained by A BC to record all Joint Account costs and receipts. Joint Accounts Costs shall mean the total expenditure incurred by Parties both within and outside India in the conduct of activities considered necessary and, or desirable under the Agreement. b) Negotiation and Application Costs Parties shall bear in proportion to their respective Participating Interest any Application/ negotiation cost, third party costs or common costs relating to negotiations/ Application for the Contract and/ or costs relating to the technical and commercial evaluation of the Block that are incurred by the Parties from time to time. c) Consolidation of Joint Account costs: ABC shall consolidate the joint costs on a monthly basis and ask parties to remit the requisite funds so that joint expenses are shared on 50:50 basis. ABC shall bill each party on or before the last day of each month for its Participating Interest share of the costs and expenses for the preceding month. Each invoice shall include a statement of all charges and credits summarised by appropriate classifications indicative of the nature thereof. Each party shall pay its Participating Interest share of such costs and expenses incurred pursuant to this Agreement in full to the party acting as Co-ordinator within fifteen (15) days following receipt of such invoice. If a Party disputes any such costs or expenses, such Party shall nevertheless remit its Participating Interest share of such costs and expenses and thereafter resolve such disputed invoices pursuant to the terms of this Agreement. If any payments are for charges which have Contract. The Chairman shall promptly advise the other participating Parties regarding strategy, and inform them of the progress of negotiations. Each of such

been made in foreign currency, the rates for which charges have been made in foreign currency, the rate of exchange to be used shall be at the exchanged rate received by ABC. The Parties intend that no party shall gain or loss as a result of currency transactions. 10. Audit A party, upon thirty (30) days advance written notice to other Parties, shall have a right to audit all accounts and records relating to the costs and expenses charged hereunder for any calendar year provided that such right of audit is exercised within a period of twenty four (24) months from the end of the calendar year to which the charges rates. Payments of any advances or billings shall not prejudice the right of any party to protest or challenge the correctness thereof. All costs and expenses charged shall conclusively be presumed to be true and correct after such twenty four (24) month period except for costs and expenses detailed in written exceptions received prior to the expiration of such period. All costs of the audit shall be borne by the Parties conducting the audit (the Auditing Parties). 11. A. Default If any Party (hereinafter referred to as the Defaulting Party) shall default in paying in full any amount due as and when required hereunder , Chairman shall promptly give Notice of such default to such Party and each of the non-Defaulting Parties. The amount not paid by the Defaulting Party shall bear interest from the date due until paid in full at the Agreed Interest Rate of. B. If such default continues for fifteen (15) days, Chairman shall give Notice of the continuing default and then each non-Defaulting Party shall within five (5) Business Days after receipt of such Notice pay the its share of the amount which the Defaulting Party failed to pay. If any non-Defaulting Party fails to pay its share of the amount in default as aforesaid, such non-Defaulting Party shall thereupon be in default and deemed a Defaulting Party subject to the provisions of this Article. The non Defaulting Parties which pay the amount owed by any Defaulting Party shall be entitled to receive their respective share of the principal and interest payable by such Defaulting Party pursuant to the terms of this Agreement. C. If the Defaulting Party has failed to remedy its default within fifteen (15) days of Chairman Notice of such default under Article 11 (A), such Defaulting party shall be deemed to have elected to withdraw from this Agreement and any Application as of the date of its default, and its Participating Interest, together with the obligations to pay amounts not paid, shall automatically vest in the non-Defaulting Parties in the proportion that each non-Defaulting partys Participating Interest bears to all the non-Defaulting Parties Participating Interests, unless agreed otherwise by non Defaulting Parties. D. Notwithstanding the forgoing, the amounts in default together with interest shall remain a debt due and owing to the non-Defaulting parties and the Defaulting Party shall be liable for all acts, occurrences, omissions, obligations and liabilities taking place or accrued, even if not yet known or billed to its Participating Interest. In addition, such Defaulting party shall be liable for its Participating Interest share of the cost of the Work remaining to be completed at the time of the default and any other work under this Agreement prior to the date of the default. If the default occurs after an Application has been submitted, then the Defaulting Party shall be further liable for its proper proportionate share of Negotiation Costs. The Defaulting party shall take all steps necessary and appropriate to effect a transfer of its interest hereunder to the remaining Participating Parties. 12. A. Undertaking Except as provided in this Agreement, each Party undertakes that neither it nor any of its Affiliates shall submit any bid covering lands within the bid area either alone or with any third Parties. No Party or any of its Affiliates shall enter into any other agreement prior to the Application Date with any entity or person pursuant to which such party or Affiliate may acquire any interest in any Contract covering all or any part of the Block. Subject to acceptance by the other Parties and without prejudice a Party or its Affiliates acquires such an interest in violation of this undertaking, such Party shall forthwith notify the other Parties and, upon request, assign or cause to be assigned on a pro-rata basis all of the interest so acquired to the other Parties for the same consideration paid by such Party or its Affiliate to the entity from whom such interest was acquired. B. If this Agreement terminates or any Party withdraws or assigns or its deemed to have withdrawn or assigned an interest, the obligations under Article 13 (A) shall remain binding upon all parties notwithstanding such termination, assignment, or withdrawal for a period of one (1) year after termination of this Agreement. 13. Operatorship: In the event of award of Contract, A shall act as Operator and the joint operations shall be conducted under the terms of a Joint Operating Agreement to be negotiated and finalised by the Parties the principal provisions of which are attached herewith as --------------. 14. Withdrawal

A.

Provided that neither of the Application made by the parties have been accepted by the Government nor is any Application pending for acceptance of the Government at a particular date, any Party may notify the other Party that it wishes to withdraw from the Agreement. Within fifteen (15) days after receipt of such notice, the other Party may similarly give notice that it wishes to withdraw from the Agreement. If both the Parties give such notice no assignment shall take place, the Parties shall be deemed to have decided to terminate the Agreement. If only one Party give such notice, the withdrawing Party shall withdraw from the Agreement on the earliest possible date and shall assign its Participating Interest under the Agreement to the non-withdrawal Parties without any compensation whatsoever.

B. C.

A withdrawing Party shall assign all of its Participating Interest to the non-withdrawing Party. A withdrawing party shall promptly inform in such action as may be necessary or desirable and shall execute and deliver any and all documents necessary to effect any such assignment and a withdrawal shall not be effective and binding upon the Parties until the date upon which the same shall have been done and all cash and expenses pertaining to any such assignment shall be the responsibility of the withdrawing Party.

D. E.

A withdrawing party shall not be allowed to withdraw from the Agreement if its Participating Interest is subject to any liens, charges or encumbrances, unless the other Party is willing to accept the assignment subject to such liens, charges or encumbrances. Unless the interest is transferred to Party acquiring the Participating Interest of the withdrawing partys liabilities and obligation, withdrawing party shall remain liable and obliged for its Participating Interest share of all liabilities, expenditure and costs. If the Agreement terminates or any Party withdraws prior to the Application Date, this undertaking shall remain binding upon the Parties notwithstanding such termination or withdrawal.

F.

A Party shall be deemed to have withdrawn from this Agreement if it decides or is deemed to have decided to participate in none of the applications. Upon such withdrawal, its Participating Interest shall be automatically assigned to the non-withdrawing Party without any compensation whatsoever.

G.

The withdrawing Party shall be liable for all costs and expenses accrued or incurred up to the date of its withdrawal including, without limitation, its Participation Interest share of the costs and expenses incurred under the Agreement, and any expenditure budgeted and/ or approved under the Agreement prior to its written notice of withdrawal and any liability for acts, occurrences or circumstances taking place or existing to its withdrawal. A withdrawing Party shall continue to remain bound by the provision of Clauses 8 and 9 of the Agreement notwithstanding its withdrawal.

H. 15 A.

After giving notice of its withdrawal, such withdrawing Party shall not be entitled to vote on any matter arising under this Agreement, other than those matters for which such Party has financial responsibility under the terms hereof. Confidentiality All bid terms, data and information acquired, interpreted, developed or disclosed during negotiations or otherwise pursuant to this Agreement shall be held confidential by all the Parties for a period of two (2) year from the termination or expiry of this Agreement. Notwithstanding the above, such information may be disclosed, on a confidential basis, to others who are not parties to this Agreement for the purposes of soliciting their participation in bidding pursuant to this Agreement, provided such other parties agree in writing prior to such disclosure not to complete against the participating Interest in any Application for a Bid Area and to maintain the confidentiality of the disclosed information.

B.

Such information may also be disclosed to: 1) 2) 3) employees, officers and directors of the Parties. Employees, officers and directors of Affiliate; Any consultant retained by the Party(s) for the purpose of evaluating the confidential information;

Prior to making any such disclosures to persons under subparagraph (3) above, however, the Party delivering such information shall obtain a written undertaking of confidentiality and non-competing in favour of all Parties, from each such person and shall promptly advise the other Parties of the disclosure. Notwithstanding the above, such information may be disclosed if it is or becomes part of the public domain or is required to be disclosed under applicable law or as required by any stock exchange to which the disclosing Party is a member or by a government order, decree, regulation, or rule [or required by any Government agency]. 16. Press Releases

Chairman shall be responsible for the preparation and release of all press releases and public statements regarding matters arising under or in relation to this Agreement; public announcement or statement may be made until all the Parties have been furnished with a copy of such statement and the approval of Party(s) holding fifty one percent (51%) or more of the Participating Interests has been obtained. Where a public announcement or statement becomes necessary or desirable because of danger to or loss of life, damage to property or pollution as a result of activities arising under this Agreement, Chairman is authorized to issue and make such announcements as deemed fit in the circumstances but shall promptly furnish all the Parties with a copy of such announcement or statement. 17. Assignment A. Except as otherwise provided in this Agreement, no Party may assign all or any part of its Participating Interest in this Agreement or in any Application without the prior written consent of the other Parties to this Agreement or such Application, as the case may be. B. Any assignment to a third party which assumes the duties and obligations of its assignor hereunder shall relieve or release the assignor from such duties and obligations accruing subsequent to the date of such assignment except obligation with respect to Art 15. 18. FORCE MAJEURE A. Any non-performance or delay in performance by any Party hereto of any of its obligations under this Agreement or in fulfilling any condition of any licence or lease granted to such Party, or in meeting any requirement of the Act, the Rules or any licence or lease issued thereunder, shall, except for the payment of moneys due under this Agreement or under the Act and the Rules or any law, be excused if, and to the extent that, such non-performance or delay in performance is caused by Force Majeure as defined in this Article. B For the purpose of this Agreement, the term Force Majeure means any cause or event, other than the non-availability of funds, whether similar to or different from those enumerated herein, lying beyond the reasonable control of, and unanticipated or enforceable by, and not brought about at the instance of, the Party claiming to be affected by such event, or which, if anticipated or foreseeable, could not be avoided or provided for, and which has caused the non-performance or delay in performance. Without limitation to the generality of the foregoing, the term Force Majeure shall include natural phenomena or calamities, earthquakes, typhoons, fires, wars declared or undeclared, hostilities, invasions, blockades, riots, strikes, insurrection and civil disturbance. C Where a Party is claiming suspension of its obligations on account of Force Majeure, it shall promptly, but in no case later than seven (7) days after the occurrence of the event of Force Majeure, notify the other Parties in writing giving full particulars of the Force Majeure, the estimated duration thereof, the obligations affected and the reasons for its suspension. D A Party claiming Force Majeure shall exercise reasonable diligence to seek to overcome the Force Majeure event and to mitigate the effects thereof on the performance of its obligations under this Agreement provided, however, that the settlement of strikes or differences with employees shall be within the discretion of the Party having the difficulty. The Party affected shall promptly notify the other Parties as soon as the Force Majeure event has been removed and no longer prevents it from complying with the obligations which have been suspended and shall thereafter resume compliance with such obligations as soon as possible. E The Party asserting the claim of Force Majeure shall have the burden of proving that the circumstances constitute valid grounds of Force Majeure under this Article and that such Party has exercised reasonable diligence and efforts to remedy the cause of any alleged Force Majeure. F Where a Party is prevented from exercising any rights or performing any obligations under this Agreement due to Force Majeure, the time for the performance of the obligations affected thereby and for performance of any obligation or the exercise of any right dependent thereon, and the term of any stage of the exploration Phase or this Agreement, may be extended by such additional period as may be agreed between the Parties. Notwithstanding anything contained hereinabove, if an event of Force Majeure occurs and is likely to continue for a period of thirty (30) days, the Parties shall meet to discuss the consequences of the Force Majeure and the course of action to be taken to mitigate the effects thereof or to be adopted in the circumstances 19. Duration : This Agreement shall be valid for a period of 3 years from the Effective Date or till the award of Contract, whichever is later, unless terminated earlier pursuant to Clause 19 hereof.

20 A. 1) 2) 3) 4) 5)

Termination: The Agreement shall take effect on the Effective Date and shall terminate forthwith upon the first to occur of any of the following events: If Applications by Parties are rejected by the Government; or If Parties elect to withdraw as provided in Article 14; or If the Parties are awarded the Contract and it has been signed ; If the Parties decide to terminate the Agreement by mutual consent If the Parties decide to supersede the Agreement by any other agreement between the Parties; B. C. Termination of this Agreement shall be without prejudice to the rights and obligations of the Parties existing as at the date of termination. Notwithstanding termination of the Agreement, each Party shall remain bound by the provisions of Article 15.

21.

Non-Waiver No waiver of any provision of this Agreement, no consent to nor departure therefrom by either Party shall be effective unless the same is in writing signed by authorised representatives of the Parties. Such waiver or consent shall be effective only in the specific instance and for the purpose for which it is given. No default or delay on the part of either Party in exercising any rights, powers or privileges hereunder shall operate as a waiver hereof or of any other rights or remedies hereunder:

22.

Notices Except as otherwise specifically provided herein, all Notices authorized or required between the Parties by any of the provisions of the Agreement, shall be in writing, in English language and delivered in person or by registered mail or by courier service or by any electronic means of transmitting written communications which provides confirmation of complete transmission, or with confirmation of receipt of complete transmission from the receiving party having been obtained and addressed to such Parties as designated below Company Secretary ABC Phone .. Fax: E.mail XYZ Company.. Or on such other address as either Party hereafter shall intimate from time to time to the other Party in accordance with this Article. Any such notice shall be deemed received by the Party to whom so addressed when delivered at such address in person or by courier service. Notice given by facsimile shall be deemed received when received by the other partys (as evidenced by acknowledgement obtained by sender from receiver) receiving terminal; Provided, however, that if a facsimile is received or delivered after a partys normal business hours or on a day that is not a business day, such facsimile shall be deemed received or delivered on the next succeeding Business Day.

23. A. B.

Applicable Law and Dispute Resolution The Agreement shall be governed by, construed, interpreted and enforced in accordance with the laws of -----------and courts at ------------------- shall have exclusive jurisdiction. If the Parties reach an impasse regarding any dispute relating to this Agreement or a breach of the Agreement, such dispute shall be settled exclusively and finally by arbitration. Any Party may submit the dispute to arbitration, the arbitration proceedings shall be held in English language at New Delhi. The number of arbitrators shall be three (3) Parties to the dispute or difference shall appoint one arbitrator each and arbitrator so appointed shall appoint third arbitrator. The arbitration proceedings shall be conducted in accordance with----------------------------------------and venue of arbitration shall be -----------------------------

24.

Entire Agreement The Agreement constitutes the entire Agreement between the Parties relating to the Area during the term hereof and, no prior promises, agreements or warranties, whether written or oral, shall be of any force or effect unless embodied herein. No modification shall be of any force or become effective unless reduced to writing in the form of a supplement or amendment to the Agreement duly executed by the Parties authorized representatives.

25.

Severability This Agreement is intended to be performed in accordance with, and only to the extent permitted by, all applicable laws, rules and regulations. If any provision of the Agreement or the application thereof to any part or circumstance shall for any reason and to any extent be invalid or unenforceable, and such invalidity or unenforceability does not materially and adversely affect the economic and legal substance of this transaction, the remainder of this Agreement and the application of such provision to the Parties or circumstances shall not be affected thereby, but rather shall be enforced to the greatest extent provided by law.

IN WITNESS WHEREOF the hand of the duly authorised representatives of the Parties affixed as of the day and year first above written.

ABC BY : NAME: TITLE: DATE:

X.Y.Z. BY: NAME: TITLE: DATE:

In the presence of
NAME

In the presence of
NAME