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EXHIBIT 10.18
AGREEMENT
FOR AMENDING THE GAS PRICING
PROVISIONS
UNDER THE CONCESSION AGREEMENT
SIGNED BY VIRTUE OF LAW NO. 113 OF 1993
FOR PETROLEUM EXPLORATION AND
EXPLOITATION IN THE QARUN AREA
WESTERN DESERT
BETWEEN
THE ARAB REPUBLIC OF EGYPT
AND
THE EGYPTIAN GENERAL PETROLEUM
CORPORATION
AND
PHOENIX RESOURCES COMPANY OF QARUN
AND APACHE OIL EGYPT, INC.
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AGREEMENT
FOR AMENDING THE GAS PRICING
PROVISIONS
UNDER THE CONCESSION AGREEMENT
SIGNED BY VIRTUE OF LAW No. 113 OF 1993
FOR PETROLEUM EXPLORATION AND
EXPLOITATION IN THE QARUN AREA
WESTERN DESERT
BETWEEN
THE ARAB REPUBLIC OF EGYPT
AND
THE EGYPTIAN GENERAL PETROLEUM
CORPORATION
AND
PHOENIX RESOURCES COMPANY OF QARUN
AND APACHE OIL EGYPT, INC.
This Agreement is made this _____ day of __________, 1993, by and between the
Arab Republic of Egypt (hereinafter referred to as "A.R.E.") or as the
"GOVERNMENT"), THE EGYPTIAN GENERAL PETROLEUM CORPORATION, a legal entity
created by law No. 167 of 1958 as amended (hereinafter referred to as
"E.G.P.C.") and PHOENIX RESOURCES COMPANY OF QARUN, a company organized and
existing under the laws of the State of Delaware, U.S.A. and APACHE OIL EGYPT,
INC. a company organized and existing under the laws of the State of Delaware,
U.S.A. (both companies hereinafter referred to collectively as "CONTRACTOR").
WITNESSETH
WHEREAS, the Arab Republic of Egypt, the Egyptian General Petroleum Corporation
and Phoenix Resources Company of Qarun and Apache Oil Egypt, Inc. have entered
into a Concession Agreement
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signed by virtue of law No. 113 of 1993 for Petroleum Exploration and
Exploitation in the Qarun Area, Western Desert.
WHEREAS, Contractor has applied for an amendment of the natural gas and LPG
Pricing provisions under such Concession agreement; and
WHEREAS, the Board of Directors of E.G.P.C., has approved such amendment, and
agreed to take the legal procedures required therefor.
Now, therefore, the parties hereto agree as follows:
ARTICLE I
Article VII (c) (2) of the Concession Agreement signed by virtue of Law No. 113
of 1993 for Petroleum Exploration and Exploitation in the Qarun Area, Western
Desert, shall be deleted in its entirety, and shall be replaced by the
following:
2- Gas and LPG
(i) The Cost Recovery and Profit Shares of Gas subject to a Gas
Sales Agreement between E.G.P.C. and CONTRACTOR (as sellers)
and E.G.P.C. (as buyer) entered into pursuant to Article VII
(e) shall be valued, delivered to and purchased by E.G.P.C. at
a price determined monthly according to the following formula:
PG = 0.85 x F x H
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42.96 x 10
Where:
PG = the value of the Gas in U.S. Dollars per thousand cubic
feet (MCF).
F = a value in U.S. Dollars per metric ton of the Crude of
Gulf of Suez blend "FOB Ras Shukheir" calculated
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by referring to "Platt's Oilgram Price Report" during a
month under the heading "Spot Crude Price Assessment for
Suez Blend." This value reflects the total averages of
the published high and low values for a barrel during such
month divided by the number of days in such month for
which such values were quoted. The value per metric ton
shall be calculated on the basis of a conversion factor to
be agreed upon annually between E.G.P.C. and CONTRACTOR.
H = the number of British Thermal Units (BTUs) per thousand
cubic feet (MCF) of Gas.
In the event that the value of F cannot be determined because
Platt's Oilgram Price Report is not published at all during a
month, the Parties shall meet and agree the value of F by
reference to other published sources. In the event that there
are no such published sources or if the value of F cannot be
determined pursuant to the foregoing for any other reason, the
Parties shall meet and agree a value of F.
Such evaluation of Gas under a formula providing for a fifteen
(15) percent discount is based upon delivery at the delivery
point specified in Article VII (e) 2(ii) below, and is to
enable E.G.P.C. to finance and maintain the portions of the
pipeline distribution system to be provided by E.G.P.C.
(ii) The Cost Recovery and Profit Shares of LPG produced from a
plant constructed and operated by or on behalf of E.G.P.C. and
CONTRACTOR shall be separately valued for Propane and Butane
at the outlet of such LPG plant according to the following
formula (unless otherwise agreed between E.G.P.C. and
CONTRACTOR):
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PLPG = 0.95 PR - (J x 0.85 F )
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42.96 x 10
Where:
PLPG = LPG price (separately determined for Propane and
Butane) in U.S. Dollars per metric ton.
PR = the average over a period of a month of the figures
representing the mid-point between the high and low
prices in U.S. Dollars per metric ton quoted in
"Platt's LPGaswire" during such month for Propane and
Butane FOB Ex-Ref/Stor. West Mediterranean.
J = BTU's removed from the Gas Stream by the LPG plant
per metric ton of LPG produced.
F = the same value as F under sub-paragraph (i) above.
In the event that Platt's LPGaswire is issued on certain days
during a month but not on others, the value of PR shall be
calculated using only those issued which are published during
such month. In the event that the value of PR cannot be
determined because Platt's LPGaswire is not published at all
during a month, the Parties shall meet and agree the value of
PR by reference to other published sources. In the event that
there are no other such published sources or if the value of
PR cannot be determined pursuant to the foregoing for any
other reason, the Parties shall meet and agree the value of PR
by reference to the value of LPG (Propane and Butane)
delivered FOB from the Mediterranean Area.
Such value of LPG is based upon delivery at the delivery point
specified in Article VII (e)(2)(iii) below.
(iii) The Prices of Gas and LPG so calculated shall apply during the
same month.
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(iv) The Cost Recovery and Profit Shares of Gas and LPG disposed of
by E.G.P.C. and CONTRACTOR other than to E.G.P.C. pursuant to
Article VII(e) shall be valued at their actual realized price.
ARTICLE II
Except as amended by this Agreement, the Concession Agreement signed by virtue
of Law No. 113 of 1993, shall continue in full force and effect in accordance
with its terms.
PHOENIX RESOURCES COMPANY OF QARUN
BY: /s/ John E. Bruno
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DATE:
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APACHE OIL EGYPT, INC.
BY: /s/ John E. Bruno
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DATE:
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EGYPTIAN GENERAL PETROLEUM CORPORATION
BY: /s/ Egyptian General Petroleum Corporation
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DATE:
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ARAB REPUBLIC OF EGYPT
BY: /s/ Arab Republic of Egypt
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DATE:
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