EXHIBIT 10.1
TRANSITORY AGREEMENT
This agreement ("The Transitory Agreement"), is celebrated between HARVEST
VINCCLER, C.A. (formerly Benton Vinccler, C.A.) a mercantile entity, registered
in the Mercantile Registry of the Judicial Circumscription of the Federal
District and Miranda State, dated Junio 29, 1993, under No 13, Volume 146-A
Sgdo, which last modification of the document of incorporation and by-laws where
it changed its social name is evidenced in a shareholder meeting held on May 3rd
2004, duly registered in the Mercantile Registry of the Judicial Circumscription
of the Capital District and Miranda State, under No 17, Volume 65-A Sgdo;
represented herein by its Director JAMES ARTHUR EDMISTON III, United States
citizen, of legal age, domiciled in the city of Houston, Texas, holder of the
Passport No _________________, issued by the United States Government, whose
appointment is evidenced in a shareholder meeting minute duly registered on
December 6th 2004, under No 39, Volume 206-A Sgdo; and duly authorized to
execute this document (the "Contractor") and PDVSA Petroleo S.A. ("PPSA"),
(Petroleos de Venezuela, S.A.' subsidiary), a mercantile entity, registered in
the Second Mercantile Registry of the Judicial Circumscription of the Federal
District and Miranda State, dated November 16, 1978, under No 26, Volume 127-A
second, which last modification of the document of incorporation and by-laws
occurred on December 13th 2002, duly registered on December 19th, 2002, under
No. 60, Volume 193-A Sgdo; represented herein by its President RAFAEL RAMIREZ
CARRENO, Venezuelan, of legal age, domiciled in Caracas and holder of the
Identity Card No _________________, and duly authorized to execute this document
according to number 25 of the by-laws. (PPSA and Contractor jointly the
"Parties").
Whereas, on April 12th 2005 the Minister of Energy and Petroleum of the
Bolivarian Republic of Venezuela ("MEP") issued instructions to Petroleos de
Venezuela, S.A. of mandatory compliance in relation to thirty two Operating
Services Agreements, in which PPSA is a party (the "Instructions"), including
the Operating Services Agreement for the South Monagas Unit (the Operating
Agreement").
The Parties agree as follows:
ARTICLE 1
LIMIT ON PAYMENTS TO CONTRACTOR
1.1 Annual Limit. The total amounts to be paid to the Contractor from year
2005, under the Operating Agreement (including Capital Fee, Operations Fee and
Interest Fee) in any given calendar year, regardless of any section providing
otherwise in the Operating Agreement, shall not exceed of the 66,67% (sixty six
point sixty seven per cent) of the total value of the crude oil produced in the
Area of the Agreement, during such year (the "Annual Limit").
1.2 Value. For purposes of the application of the preceding clause, that is
Article 1.1 set forth above, the value of the crude oil produced in any given
quarter, shall be determined as indicated in Annex A.
ARTICLE 2
INCOME TAXATION
The Contractor undertakes to faithfully pay all the amounts due to the
Servicio Nacional Integrado de Administracion Aduanera y Tributaria (SENIAT),
under the requirements of the Income Tax Law of the Bolivarian Republic of
Venezuela.
ARTICLE 3
MIGRATION TO A MIXED COMPANY
The Parties undertake to negotiate in good faith the terms and conditions
for the conversion of the Operating Agreement into mixed company. The State,
PPSA or any of its affiliates will have an equity participation of more than 50%
of the shares of the mixed company which exploits crude oil, and a participation
to be negotiated between the Parties of the mixed company which exploits gas.
ARTICLE 4
APPLICABLE LAW
This Transitory Agreement shall be interpreted and regulated in accordance
with the laws of the Bolivarian Republic of Venezuela.
ARTICLE 5
CAPACITY OF THE PARTIES
The Parties recognize that they execute this Transitory Agreement in their
own name, as a legal person capable and as a party to the Operating Agreement.
Likewise, either Party declares and guaranties that: (i) has full power to
execute and comply with the terms of the Transitory Agreement; (ii) has obtained
all the approvals and authorizations required for the execution of this
Transitory Agreement; and (iii) once executed by a duly authorized
representative, this Transitory Agreement shall constitute a binding and
enforceable obligation under its terms.
IN WITNESS WHEREOF, the Parties sign this Transitory Agreement in the city of
Caracas on 4th of August, 2005
HARVEST VINCCLER, C.A. PDVSA PETROLEO, S.A.
- ------------------------------------- ----------------------------------------
JAMES ARTHUR EDMISTON III RAFAEL RAMIREZ CARRENO
Director President
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ANNEX A
PRICE CALCULATION FORMULA FOR PDVSA'S INCOME:
PRICE FOR PDVSA'S INCOME = 0.775* (FORMULA PRICE CPB FIRST ROUND)
CPB = CRUDE PRICE BASKET
FORMULA PRICE FOR CPB FIRST ROUND'S CALCULATION (ARTICLE S13 OPERATING SERVICES
AGREEMENT SOUTH MONAGAS UNIT (PAGE 44) AND ITS AMENDMENT)
(((THUMS+ DUBAI+ BRENT+ WTI+ 2WTS)/6) - 0,058) X 0.775
CALCULATION EXAMPLE:
Price for PDVSA's income = (((33,67+33.62+38.14+41.38+2*37.,42)/6) -
0.058)x 0.775 = 28.58 $/BL
2004 AVERAGE PRICE USED IN THE EXAMPLE:
UNL 87
CPAA 3%SU. (GASOLINA SIN GASOIL NO.2
(RESIDUAL 3.0% PLOMO 87 PLATT'S (DESTILADO No 2
AZ. PLATT'S GOLFO GOLFO PLATT'S GOLFO
WATERBORNE WATERBORNE WATERBORNE
THUMS DUBAI BRENT MEAN) MEAN) MEAN)
($/B) ($/B) ($/B) ($/B) ($/B) ($/B)
----- ----- ----- ----------------- ---------------- ---------------
2004 33,67 33,62 38,14 24,70 49,30 45,54
NAFTA ENTERA
ASFALTO (NAFTA ENTERA
PAVIM.(POTEN & PLATT'S GOLFO LLS (LIGHT
PARTNERS BARGE WATERBORNE WTI (WEST TEXAS WTS (WEST LOUISIANE
CIF GOLFO) MEAN) INTERMEDIATE) TEXAS SOUR) SWEET) MAYA
($/B) ($/B) ($/B) ($/B) ($/B) ($/B)
-------------- ------------- --------------- ----------- ---------- -----
2004 23,65 46,30 41,38 37,42 41,50 30,04
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