Exhibit 10.1
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CONTRACT
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CONTRACT OF
SALE OF HARKEN CRUDE
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VALUE
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UNDETERMINED.
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TOTAL TERM
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1 MAY 2005
TO APRIL 30, 2006
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The following contracting parties: On the one
hand, PETROBRAS COLOMBIA LIMITED , a corporation
incorporated under the laws of the U.K. with a branch office duly
constituted in Colombia and represented in this act by JOSE
RAIMUNDO BRANDAO PEREIRA, of legal age, and alien I.D. No. 307.839
issued in Bogotá in his capacity as General Manager,
hereinafter referred to as THE BUYER , and on the other
hand, HARKEN DE COLOMBIA LTD, a corporation incorporated
under the laws of the Cayman Islands, with a branch office
established in Colombia in accordance with Public Deed No. 406
dated 19 February 1993, issued by the Eleventh Notary Public of the
Bogotá Circle, whose main business address is in Bogotá
D.C., hereinafter referred to for all purposes as THE SELLER
, represented by GUILLERMO SÁNCHEZ B., as certified in the
Certificate of Existence and Legal Representation of the
Bogotá Chamber of Commerce, of legal age, resident in the city
of Bogotá, identified with U.S. Passport No 132457597, have
agreed to execute this contract of oil purchase/sale subject to the
following clauses:
WHEREAS:
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a)
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On 29 December
2003, ECOPETROL S.A . and THE SELLER entered into the
Alcaraván Association Contract.
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b)
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THE
SELLER maintains in
production under the Alcaraván Association Contract the Estero
and Cajaro wells located in the Paloblanco Field and the Canacabare
well, located in the Anteojos field, in the municipalities of
Maní and Orocué, province of Casanare.
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c)
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On 14 September
2004, the AGENCIA NACIONAL DE HIDROCARBUROS and THE
SELLER entered into the Rio Verde exploration and explication
contract.
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d)
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THE
SELLER maintains in
production under the Rio Verde Field Contract the Macarenas and
Tilodiran wells. The Paloblanco, Anteojos and Rio Verde Fields
shall hereinafter be referred to as The Fields.
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e)
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That THE
SELLER maintains in production the Olivo well within the
Bolivar Association Contract and the Catalino-Olivo Field. Palo
Blanco, Anteojos and Rio Verde shall hereinafter be referred to as
the “Fields”.
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f)
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That THE
SELLER maintains in production the Torcaz 2 and Torca 3 wells
within the Bocachico Association Contract and the Torcaz Field.
Palo Blanco, Anteojos, Rio Verde, Catalina-Olivo and Torcaz fields
shall hereinafter be referred to as the
“Fields”.
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CONTRACT VRP – 005 –
2004 Page 2 of
7
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g)
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In performance
of such contracts, 100% of their production belongs to THE
SELLER , after discounting the nation’s royalties,
excluding production from the Cajaro well in the Alcaravan
Association Contract, whose Commerciality was declared and,
consequently, 50% of the production, discounting the nation’s
royalties, belongs to ECOPETROL.
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h)
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By means of
communication UN-COL/GEAL 0052/2005, THE SELLER presented a
proposal to THE BUYER for the purchase of Oil from the
aforementioned fields owned by THE BUYER .
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i)
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THE SELLER by
means of communication GG-095-05 accepted the above-mentioned offer
in the conditions indicated in such letter.
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j)
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THE
BUYER and THE
SELLER hereby agree on the sale of the oil owned by THE
SELLER produced in the Fields.
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Based on the above, THE BUYER and THE
SELLER
AGREE:
CLAUSE ONE.—PURPOSE AND QUANTITIES: THE
SELLER is hereby bound
to sell and deliver to THE BUYER and THE BUYER is
bound to receive and pay for, in the conditions provided herein,
the oil corresponding to the Fields, corresponding to the share it
owns, as follows:
Alcaravan Association Contract, Sole Risk
Modality:
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-
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Production
equivalent to 100% after royalties.
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Alcaravan Association Contract, Cajaro
Commercial Area:
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-
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Production
equivalent to 50% after royalties
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Rio Verde Exploration and Exploitation
Association Contract:
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-
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Production
equivalent to 100% after royalties.
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Bolívar Association Contract, Sole Risk
Modality:
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-
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Production
equivalent to 100% after royalties.
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Bocachico Association Contract, Sole Risk
Modality:
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-
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Production
equivalent to 100% after royalties.
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PARAGRAPH 1: The volumes of oil purchased shall be those
included in each shipment of Vasconia blend, made by Petrobras, as
per the information provided by OCENSA or by the party acting as
the programmer of Vasconia Blend oil shipments.
PARAGRAPH 2: THE BUYER shall ask OCENSA to include the
oil in the volumetric compensation carried out by the Company to
establish the volume of Vasconia Mix crude oil that corresponds to
each barrel of oil produced in the Fields delivered by THE
SELLER in the Santiago Field.
PARAGRAPH 3: THE BUYER shall be in control of all the operations and
activities deemed necessary for an efficient technique and
economical operation of the oil management in the
Santiago
CONTRACT VRP – 005 –
2004 Page 3 of
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Station. THE BUYER shall not be held
responsible for losses caused on THE SELLER for delays in
receipt of the crude due to operational difficulties of the
Santiago Field production station.
PARAGRAPH 4: THE BUYER shall be r