2203ED, 26.09.14 Model Petroleum Title Farmout Agreement Single Party EXPOSURE DRAFT

Model Petroleum Title Farmout Agreement
(Single Party)
EXPLANATORY NOTE
The Board of AMPLA Ltd ACN 006 037 529 has prepared this Exposure Draft Model Petroleum
Title Farmout Agreement (Single Party) (Model Farmout Agreement) for use in non-complex
oil and gas projects, primarily in the exploration and appraisal phases, following the
recommendations of a Reference Group selected from experienced AMPLA members working in
petroleum companies and in private practice.
This Model Farmout Agreement is an agreement which may be used under the law of the
Commonwealth or any State or Territory of Australia, including offshore waters. It is intended to
be used in conjunction with the AMPLA Model Petroleum Joint Operating Agreement, or the
AMPLA Model Petroleum Exploration Joint Operating Agreement.
The Model Farmout Agreement assumes that the sole holder of the Petroleum Title(s) is farming
out part of its interest. To earn its interest, the Farmee is funding the Farmors costs during the
Earning Period and/or carrying out the work itself and/or refunding past expenditure to earn or
acquire its interest in the Petroleum Title(s). Stamp duty and/or registration fees may be
chargeable which will impact on any transaction, depending on the jurisdiction in which the
Petroleum Title is located.
This Model is not intended as a rigid precedent to be adopted without amendment. Rather it is a
guide which includes representative and balanced provisions across matters normally covered in
such an agreement. In any particular matter, alternative clauses, such as those relating to earning
of an interest in the Petroleum Title, can be inserted in the Model with minimum amendment.
Reference should also be made to the Model Alternative and Optional clauses which can be used
with, or in substitution for, clauses in this Model.
Note: This Model form document continues to be revised and updated. The AMPLA website
should be checked to ensure that you are using the latest version.
RELATED AMPLA MODEL DOCUMENTS
Petroleum Farmout Agreement, Alternative & Optional clauses, Exposure Draft

Petroleum Joint Operating Agreement
Petroleum Joint Operating Agreement Alternative & Optional clauses
Petroleum Exploration Joint Operating Agreement
Royalty Deed for use with Sale-Farmin Agreement
COPYRIGHT
This Model Farmout Agreement is the property of AMPLA Ltd which owns the copyright.
AMPLA financial members are granted a royalty free licence to use the Model Farmout
Agreement for commercial purposes on the basis set out below. Non-members may use the
Model Farmout Agreement on a similar basis only if the applicable licence fee has been paid.
DISCLAIMER
This document is provided for use only by persons engaging in commercial activities.
AMPLA Model Petroleum Title Farmout Agreement (Single Party), EXPOSURE DRAFT, 26.09.2014
i
No person or entity (including, without limitation, AMPLA Limited) associated with the
development of this document makes any representation or warranty regarding the Model
Farmout Agreement, nor is liable for any loss or damage whatsoever that may result from the use
of the Model Farmout Agreement or any portion or variation thereof, or any other materials

(Single Party)
presented in conjunction with the Model Farmout Agreement or any errors or omissions in its
contents.
AMPLA LTD. MAKES NO WARRANTY OR GUARANTEE OR PROMISE, EXPRESS OR
IMPLIED, THAT THIS MODEL FARMOUT AGREEMENT IS ACCURATE, COMPLETE,
VALID AND ENFORCEABLE, UP TO DATE, OR FIT FOR ANY USE WHATSOEVER. IT
IS MADE AVAILABLE ON THE AMPLA WEBSITE FOR THE INFORMATION AND USE
OF AMPLA MEMBERS AND FOR THE USE OF NON-MEMBERS ON PAYMENT OF THE
APPLICABLE LICENCE FEE AND ON THE CONDITION THAT AMPLA LTD IS NOT
ENGAGED IN RENDERING PROFESSIONAL ADVICE. READERS OF IT SHOULD
EXERCISE THEIR OWN SKILL AND JUDGMENT IN ADOPTING OR ADAPTING ANY
PART OF THE MODEL DEED FOR THEIR OWN USE AND, WHERE NECESSARY, SEEK
ADVICE FROM A SUITABLY QUALIFIED LEGAL PRACTITIONER.
Note for South Africa use: If you acquire, download and/or use an AMPLA Model Document in
South Africa or for use in respect of a transaction relating to South Africa in any way, you
warrant that you are doing so on behalf of a juristic person whose asset value or annual turnover
equals or exceeds 2 million rand. AMPLA Model Documents are not available to any other
person in, or in connection with, South Africa.
IMPROVEMENTS
ii
If you have any questions or suggestions for improvement concerning this Model Farmout
Agreement, please contact the AMPLA office at federal@ampla.org or see www.ampla.org. All
questions, comments and other feedback would be appreciated by the AMPLA Board.

(Single Party)
1
Definitions and interpretation
1.1
1.2
Definitions
Interpretation
1
3
Conditions precedent
2.1
2.2
2.3
2.4
Coming into effect of agreement

Satisfaction of Conditions Precedent
Failure to satisfy Condition Precedent
Consequence of failure to satisfy Condition Precedent
4
4
4
4
Assignment of Farmin Interest and Completion
3.1
3.2
3.3
Assignment of Farmin Interest

Pre-Completion requirements
Completion
4
5
5
Representations, warranties and acknowledgements
4.1
4.2
4.3
4.4
4.5
4.6
4.7
Party warranties
Representations and warranties by the Farmor
Warranties by the Farmee
Acknowledgement by the Farmor
Acknowledgements by the Farmee
Specific waivers
Mitigation and limitation on claims
6
6
7
7
7
8
8
Earning of Farmin Interest
5.1
5.2
5.3
Earning Obligation
Completion of Earning Obligation
Risk and indemnity
9
9
10
Party covenants
10
6.1
6.2
Farmee covenants
Farmor covenants
10
10
Assignment
11
7.1
7.2
Assignment by Farmor
Assignment by Farmee
11
11
PRRT, income tax and CGT
11
8.1
8.2
8.3
8.4
PRRT credits transfer notice

PRRT Information
Recognition of income and expenses
Value for CGT purposes
11
12
12
12
Goods and Services Tax
12
9.1
12
i
Particulars
Table of Contents
9.2
9.3
Supply as a going concern

GST payable on other supplies
12
13
10
Default
13
10.1
10.2
Termination for default

Consequences of termination
13
14
11
Force Majeure
15
11.1
11.2
11.3
11.4
Meaning of Force Majeure

Relief
Labour disputes and native title matters
Resumption
15
15
16
16
12
Confidentiality
16
12.1
12.2
12.3
12.4
12.5
12.6
Agreement is confidential
No disclosure except as permitted
Permitted disclosure by a party
Confidential Information disclosed only as necessary
Publicity and disclosure
Access to Information
16
16
17
17
17
17
13
Expert determination
17
13.1
Technical disputes
17
14
Notices
18
14.1
14.2
Form of Notice
When Notices are taken to have been given and received
18
18
15
Ancillary provisions
18
15.1
15.2
15.3
15.4
15.5
15.6
15.7
15.8
15.9
15.10
Entire agreement
Severability
Waiver
Amendment
Counterparts
Applicable law
No reliance or inducement
Further assurances
Fees and charges
Power of attorney
18
18
19
19
19
19
19
19
19
20
21
Basic Particulars
21
Schedule 2
23
Petroleum Titles as at the Effective Date
23
Schedule 3
24
Disclosure Materials
Specific disclosures [Example only]
24
24
P
Schedule 1
ii

(Single Party)
25
Joint Operating Agreement
25
Schedule 5
26
Deed of Assignment and Assumption
26
Signing page
27
Schedule 4
iii

(Single Party)
Petroleum Title Farmout Agreement

Particulars
Dated as of
Parties
Name
Farmor
ABN
Address
Email
Fax
Authorised Officer
Name
Farmee
ABN
Address
Email
Fax
Authorised Officer
Recitals
A.
The Farmor is the beneficial owner, and is entitled to be registered

as the holder, of the Petroleum Title or Titles in the Title Area,
including the Farmin Interest.
B.
The Farmor and the Farmee have agreed that the Farmee may
acquire the Farmin Interest by satisfying the Earning Obligation on
the terms and conditions set out in this agreement.
The parties agree:

in consideration of, among other things, the mutual promises contained in this agreement:
1.1
Definitions
Unless the context otherwise requires, the following expressions have the following
meanings in this agreement (including the Recitals):
Act means the legislation specified in Schedule 1.
1
Agreement Date means the date of this agreement as shown on page 1, or if no date is
shown, then the date that this agreement is fully executed by the parties.
Affiliate means, with respect to a particular entity, a related body corporate of that entity
as defined in section 50 of the Corporations Act 2001 (Cth).
Approval and Registration means the approval and registration of a transfer of, and
dealings with, a Petroleum Title by the relevant Authority under the Act in order to
give effect to this agreement.
Approval Date means the last date on which the Conditions Precedent have been
satisfied or waived in accordance with this agreement or, if there are no Conditions
Precedent, then the Agreement Date.
Approvals Period means the time specified in Schedule 1, or such other period agreed
by the parties in writing.
Authorisation means any consent, authorisation, registration, filing, lodgement,
notification, agreement, certificate, commission, lease, licence, permit, approval or
exemption from, by or with an Authority including Approval and Registration.
Authority means any government department, local government council, government
or statutory authority or agency or any other person or entity under a Law which has a
right to impose a requirement on, or whose consent is required to carry out,
Operations.
Completion means completion of the assignment of the Farmin Interest by the Farmor
to the Farmee in accordance with this agreement.
Completion Date means the date that is 7 days after the Approval Date, or any other
date the parties agree in writing.
Conditions Precedent means the conditions required to be satisfied for this agreement
to be effective, as set out in Schedule 1.
Cost Cap means the monetary limit that the Farmee is required to initially wholly fund
and spend in respect of the Earning Obligation (if any) as specified in Schedule 1.
Deed of Assignment and Assumption means the deed of assignment and assumption
of the Farmin Interest substantially in the form set out in Schedule 5 or, if no form is
included in Schedule 5 then, and in default of agreement, the applicable AMPLA
Model Form Deed of Assignment and Assumption appearing on www.ampla.org.
Disclosure Materials means, in respect of the Farmin Interest:
(a)
this agreement, including Schedule 3, being a set of disclosures made by the

Farmor to the Farmee in respect of the Farmors warranties under this
agreement; and
(b)
all files, records, materials, correspondence, documents and other written

information contained or listed in Schedule 3.
Duty means any stamp, transaction or registration duty or application fee or any
similar charge imposed by an Authority and includes any interest, fine, penalty, charge
or other amount imposed in respect of the above, but excludes GST.
Earning Obligation means the work and expenditure of the nature and amount set out
in Schedule 1 to be undertaken and incurred by the Farmee in carrying out activities in
or about the Title Area pursuant to this agreement.
Earning Period means the period set out in Schedule 1.
1
Encumbrance means any security interest, mortgage, private royalty, free carried
interest, assignment of income, production bonus, pledge, lien, charge, title retention
arrangement, trust or power, or other form of security or interest having effect as a
security for the payment of any monetary obligation or the observance of any other
obligation whether existing or agreed to be granted or created.
Effective Date means the date set out in Schedule 1.
Excepted Encumbrances are the Encumbrances set out in Schedule 1.

Excluded Loss means any one or more of:
(a)
loss or damage arising out of Petroleum reservoir or formation damage, or any

production delay, interruption to or loss of, or any inability to produce, deliver or
process, Petroleum;
(b)
loss or damage incurred, or liquidated or pre-estimated damages or penalties of

any kind whatsoever borne or payable under or in connection with any contract
for the sale, processing, storage, transportation, or other disposal of Petroleum;
(c)
loss, or anticipated loss, of use, profit or revenue, loss of business reputation,

business interruption of any nature, loss of opportunity, loss of anticipated savings
or wasted overheads;
(d)
exemplary or punitive damages; or
(e)
any loss or damage arising from special circumstances that are outside the
ordinary course of things.
Farmin Interest means the percentage interest in the Petroleum Title or Titles set out
in Schedule 1 which is being farmed out under this agreement.
Good Australian Oilfield Practice means recognised oil and gas field methods,
procedures and practices consistent with applicable Laws and Authorisations, together
with the exercise of that degree of skill, diligence, prudence and foresight that
reasonably would be expected from an experienced and competent contractor in
Australia under comparable conditions to the relevant activity in the light of known
facts, or facts which should reasonably have been known at the time, and having regard
to the need for:
(a)
(b)
(c)
(d)
suitable and experienced personnel and adequate materials;

ongoing monitoring and testing of plant and equipment performance, safe
operating procedures and appropriate maintenance procedures;
the observance of relevant Australian and international standards; and
in the case of design, engineering and construction, internationally accepted
design, engineering and construction practices that reasonably would be expected
from recognised designers, engineers and constructors of comparable plant,
equipment and facilities in Australia.
GST means any goods and services tax, value added tax or any tax analogous thereto
but excludes any statutory late payment interest or penalties.
Indigenous Agreement means the indigenous agreement specified in Schedule 1.
Information means information, data and records relating to Operations or other
works carried out concerning the Title Area including all surveys, maps, aerial
photographs, electronically stored data, sketches, drawings, memoranda, drill cores,
logs of those drill cores, geophysical, geological or drill maps, sampling and assay
reports and notes.
JOA means the joint operating agreement to be established pursuant to this agreement
in the form attached as Schedule 4, or on the basis of such other form or principles as
the parties agree.
2
Law means Commonwealth and State legislation, the requirements and guidelines of any
Authority, including the listing rules of a recognised stock exchange, with which a party
is legally required to comply, and common law and equity.
Nominated State is the State or Territory of Australia as set out in Schedule 1, and
includes any adjacent offshore area of that State or Territory, if applicable.
Operations means exploration or appraisal operations or activities, including acquiring
geological, geophysical, geochemical and other similar Information, and drilling wells
for the purpose of exploring for, or appraising, accumulations of Petroleum, including
testing conducted in the bore of an exploration or appraisal well.
Particulars means the particulars of a party given on page 1 of this agreement, or as
amended by the party by notice given in accordance with this agreement.
Past Expenditure Amount means the amount (if any) set out in Schedule 1 to be paid
by way of reimbursement of past expenditure in relation to the Petroleum Title.
Petroleum has the meaning defined in the Act.
Petroleum Title means the petroleum title or titles, details or copies of which are
included in Schedule 2, and include any application for and any extension, renewal,
conversion or substitution of any of those titles.
PRRT means petroleum resource rent tax payable under the PRRT Act.
PRRT Act means the Petroleum Resource Rent Tax Assessment Act 1987 (Cth.).
Title Area means the whole of the area within the Petroleum Title and, as at the
Agreement Date, as depicted on the Title Area map annexed to Schedule 2 (if any).
Transfer means a transfer of the legal title in a Petroleum Title into the name of the
Farmee in the form required by and registerable under the Act.
1.2
Interpretation
the singular includes the plural and vice-versa;
(b)
headings do not affect the interpretation of this agreement;
(c)
a reference to a party means a party to this agreement as listed in the Particulars

and includes that partys executors, administrators, substitutes, successors and
permitted assigns;
(d)
references to a part, clause, schedule, exhibit and annexure refers to a part, clause,
schedule, exhibit or annexure of, in or to this agreement;
(e)
a reference to this agreement includes all schedules, exhibits and annexures to this
agreement;
(f)
a reference to an agreement, deed, instrument or other document includes the same

as amended, novated, supplemented, varied or replaced from time to time;
(g)
a reference to a court is to an Australian court;
(h)
a reference to any legislation or legislative provision includes any statutory

modification or re-enactment of, or legislative provision substituted for, and any
subordinated legislation issued under, that legislation or legislative provision;
(i)
a reference to a day, month or year is relevantly to a calendar day, calendar month

or calendar year;
(j)
a reference to $, AUD or dollars is to the lawful currency of the Commonwealth of

Australia;
(k)
the expressions including, includes and include have the meaning as if

followed by without limitation;
P
(a)
3
In this agreement, unless the context otherwise requires:
(l)
where a word or phrase is defined, its other grammatical forms have a

corresponding meaning;
(m)
a party may exercise a right or remedy or give or refuse its consent in its
absolute and unfettered discretion (including by imposing conditions), unless
this agreement expressly states otherwise; and
(n)
no rule of construction is to apply to the disadvantage of a party on the basis that

that party drafted the whole or any part of this agreement.
Conditions precedent
2.1
Coming into effect of agreement
2.2
2.3
(a)
Subject to the Act, this clause 2 and clauses 1 (Definitions and interpretation),
3.2 (Pre-Completion requirements), 4 (Representations, warranties and
acknowledgements), 7 (PRRT, income tax and CGT), 8 (GST), 11
(Confidentiality), 12 (Notices), 13 (Assignment), 14 (Ancillary) and Schedule 1
come into effect on the Agreement Date.
(b)
The remainder of this agreement comes into effect on the Approval Date.
Satisfaction of Conditions Precedent
(a)
Each party must use all reasonable endeavours (other than waiver) at its cost to
ensure that each of the Conditions Precedent is satisfied within the Approvals
Period.
(b)
Each party must keep the other informed of its progress in obtaining satisfaction
of any Condition Precedent it is required to obtain and any circumstance that
may result in any of those conditions not being satisfied in accordance with its
terms.
(c)
Each party must give the other notice that the conditions of the satisfaction of a
Condition Precedent (if any) are acceptable, or unacceptable, to it.
Failure to satisfy Condition Precedent
If all Conditions Precedent are not satisfied, or otherwise waived, within the Approvals
Period, or if a party, acting reasonably, gives notice to the other party that the
conditions of satisfaction of a Condition Precedent imposed by a third party are
unacceptable to it, either party may terminate this agreement by notice to the other,
provided that the notice must be given before the Completion Date.
2.4
Consequence of failure to satisfy Condition Precedent
Assignment of Farmin Interest and Completion
3.1
Assignment of Farmin Interest
(a)
Subject to the satisfaction of the Conditions Precedent, and in consideration of

the terms of this agreement, the Farmor agrees to assign and transfer to the
Farmee, and the Farmee agrees to accept, the Farmin Interest upon the terms and
conditions of this agreement and in accordance with the Deed of Assignment and
Assumption.
(b)
Subject to the issue of the required Authorisations and the terms of this
agreement, the assignment of the Farmin Interest as between the parties is
4
If a party terminates this agreement by notice for failure to obtain satisfaction of a

Condition Precedent on conditions acceptable to it, then each party is released from all
further obligations under this agreement, other than the obligations of confidentiality,
and no party has any claim against the other party as a consequence of the termination.
effective for all purposes on and from the Effective Date. Following Completion,
the beneficial interests in the Petroleum Title will be:
Party
Interest
Farmor
]%
Farmee
]%
]%
Total
3.2
Pre-Completion requirements
Notwithstanding any other provision of this agreement, as soon as practicable after the
Agreement Date:
3.3
(a)
the Farmee must apply for all Authorisations to be obtained in order to satisfy
the Conditions Precedent;
(b)
each of the parties must, at the same time as executing this agreement, execute
the Deed of Assignment and Assumption, and a Transfer if required under the
Act, to be held by the Farmor pending Completion;
(c)
the Farmor must provide to the Farmee, on a strictly confidential basis, all
technical and financial information required to obtain Approval and Registration;
(d)
the Farmee must lodge this agreement for Approval and Registration, and when
doing so, to the extent permitted by the Act, must require that only a summary
instrument (or a supplementary instrument), and not the original instrument, be
available for public inspection on the grounds that this agreement contains
commercially sensitive information;
(e)
the Farmee must bear and pay the costs of obtaining all Authorisations required
for the assignment of the Farmin Interest, including all Duties, but excluding any
internal costs or external advisory costs incurred by the Farmor; and
(f)
the parties acknowledge that no dealing contained in this agreement is of any

force or effect until approved and registered under the Act.
Completion
(a)
On the Completion Date the parties must meet at 11.00 am at the offices of the
Farmor, or such other time or place as the parties may agree, at which time:
(i) the Farmor must deliver any Information held by the Farmor to the Farmee
that has not been previously provided, subject to any applicable
confidentiality restriction;
(ii) the Farmee must pay to the Farmor the Past Expenditure Amount (if any);
(iii) the Farmor must deliver to the Farmee a duly executed Deed of
Assignment and Assumption (and the Transfer if required under the Act)
of the Farmin Interest;
(iv)
the Farmor must deliver to the Farmee a duly executed deed of assignment
and assumption of any Indigenous Agreement or other third party
agreement relating to the Farmin Interest required under any Law; and
(v) on or before the Completion Date, execute the JOA and deliver duly executed
copies of the JOA to each other.
5
Subject to Completion occurring and this agreement, with effect on and from the
P
(b)
Effective Date the Farmee assumes all of the rights, benefits, obligations and
liabilities of the Farmin Interest in place of the Farmor.
(c)
On and from the Completion Date and subject to this agreement:

(i)
the parties agree to associate themselves in and form a joint venture to

explore for Petroleum and appraise, develop or exploit discoveries in
relation to the Title Area on the terms of the JOA;
(ii)
the first operator of the joint venture is the party named as operator in the
JOA and in Schedule 1; and
(iii) if there is any inconsistency between the JOA and this agreement, this
agreement will prevail to the extent of the inconsistency; and
(iv)
if the parties cannot agree on a term of the JOA, they agree to adopt the
equivalent term set out in the AMPLA Model Petroleum Joint Operating
agreement posted at that time on www.ampla.org.
(d)
Upon Completion, the Farmor must conduct an accounting and make any
adjustments as are necessary to reflect the assignment of the Farmin Interest as at
the Effective Date, such adjusted amounts to be settled within 7 days of the
conclusion of such accounting.
(e)
The obligations of the Farmor and the Farmee under this clause are
interdependent. Completion is conditional upon, and will not be taken to have
occurred until, both the Farmor and the Farmee have complied with all of their
respective obligations under this clause.
Representations, warranties and acknowledgements
4.1
Party warranties
Each party warrants for the benefit of the other party that:
4.2
(a)
(Incorporation) it is validly incorporated, organised and subsisting in

accordance with the laws of its place of incorporation;
(b)
(Power and capacity) it has full power and capacity to enter into and perform
its obligations under this agreement and is qualified to do business in the
Nominated State;
(c)
(Corporate authorisations) all necessary authorisations for the execution,

delivery and performance by it of this agreement in accordance with its terms
have been obtained;
(d)
(No legal impediment) its execution, delivery and performance of this

agreement complies with its constitution and does not constitute a breach of any
law or obligation, or cause a default under any agreement by which it is bound;
(e)
(Insolvency) no meeting has been convened, resolution proposed or order made

for the winding up, or the appointment of an administrator, of it, and no
mortgagee or chargee has taken, attempted to take or indicated an intention to
exercise its rights under any security; and
(f)
(No trust) it enters into and performs this agreement on its own account and not
as trustee for or nominee of any other person.
Representations and warranties by the Farmor
6
The Farmor warrants for the benefit of the Farmee in respect of each Petroleum Title
the subject of this agreement that, as at the Agreement Date, and as at the Approval
Date and at the Completion Date, except as otherwise disclosed in the Disclosure
Materials:
(a)
it is the legal and beneficial owner of the Farmin Interest, free of Encumbrances
or claims by third parties, other than the Excepted Encumbrances;
(b)
there is no matter, fact or thing which would preclude the Farmor from disposing
of the Farmin Interest to the Farmee in accordance with this agreement; and
(c)
the Petroleum Title is in good standing under the Act and is not liable to
cancellation or forfeiture for any reason and it is not aware of any circumstances
which may give rise to such cancellation or forfeiture;
(d)
it has complied with all obligations and Laws in respect of the Petroleum Title
and all Authorisations in all material respects;
(e)
it is not engaged in any litigation, arbitration or other proceeding concerning the

Petroleum Title and it is not aware of any pending or threatened litigation,
arbitration or other proceeding concerning the Petroleum Title;
(f)
to the best of the Farmors knowledge and belief, there is no information

relevant to the Farmin Interest which has not been included in the Disclosure
Materials and which could reasonably be expected to have a material adverse
effect on the value of the Farmin Interest;
(g)
it has provided complete and accurate answers to requests for Information made
to the Farmor by or on behalf of the Farmee; and
(h)
to the best of its knowledge and belief, having made all reasonable enquiries,
Operations performed in the Title Area or in relation to the Petroleum Title,
including the completion and abandonment of any wells, have been carried out
in accordance with Good Australian Oilfield Practice,
provided that each of the above warranties must be construed as a separate warranty
and must not be expanded by reference to any other matter, warranty, representation or
undertaking.
4.3
Warranties by the Farmee
The Farmee warrants for the benefit of the Farmor that at the Agreement Date and at
the Completion Date:
4.4
(a)
there are no material claims, demands, actions, suits, governmental inquiries, or

proceedings pending, or to the Farmees knowledge, threatened, against the
Farmee which would have a material adverse effect upon the completion of the
transactions contemplated by this agreement; and
(b)
the Farmee has the financial resources, and the technical capability, personnel
and resources, to enable it to fulfil all of its prospective obligations and liabilities
under the Petroleum Title and this agreement.
Acknowledgement by the Farmor
The Farmor acknowledges that the Farmee may audit all costs and payments made by
the Farmor in respect of the Farmin Interest under this agreement in accordance with
the audit provisions in the Accounting Procedure attached to the JOA.
4.5
Acknowledgements by the Farmee
The Farmee acknowledges and agrees that:
7
it has undertaken its own due diligence in relation to the Farmin Interest and has
relied on its own independent technical, commercial, fiscal and legal judgement
in entering into this agreement;
P
(a)
(b)
except for the warranties specifically given in this agreement:

(i) the Farmor makes no warranties or representations (express or implied) in
relation to the Farmin Interest or the Disclosure Materials;
(ii) all warranties and representations, whether express, implied, written, oral,
collateral, statutory or otherwise, are excluded; and
(iii) the Farmor disclaims all liability in relation to the excluded warranties and
representations to the maximum extent permitted by law; and
(c)
4.6
the Farmors warranties are not breached, and each representation in the
Farmors warranties is qualified, by matters contained in this agreement, the
Disclosure Materials, all publicly available information and data available to the
Farmee and any matter within the actual knowledge of the Farmee as at the
Agreement Date.
Specific waivers
To the maximum extent permitted by law, the Farmee irrevocably waives any right it
may have to bring an action in respect of any contravention of the Corporations Act
2001 (Cth), the Australian Securities and Investments Commission Act 1989 (Cth) and
the Consumer and Competition Act 2010 (Cth) or corresponding State or Territory
legislation in respect of any statement, representation, conduct or omission by or on
behalf of the Farmor which is not expressly contained in this agreement.
4.7
Mitigation and limitation on claims
(a)
A party must use all reasonable efforts to avoid or mitigate any loss or damage
incurred by it which may give rise to a claim by it under or in connection with
this agreement, including under any warranty given by the other party.
(b)
A party has no liability to the other party in respect of a claim under or in

connection with this agreement to the extent that the other party has recovered
from, or been indemnified by, a third party under the terms of any insurance
policy in respect of the loss or damage giving rise to such claim.
(c)
Notwithstanding anything else in this agreement or otherwise, the Farmee

undertakes not to make any claim against the Farmor in relation to:
(i)
any geological, geophysical, engineering, economic, fiscal, legal or other

data, interpretations or evaluations (including resources and reserves) by
the Farmor, any of its Affiliates or any other person affecting the
Petroleum Title or this agreement;
(ii)
any matter that the Farmee knows or could have known, by reasonable
enquiry, before the Completion Date;
(iii) future matters, including future or forecast costs, revenues, markets,

reserves, life of fields, production or profits;
the legal and fiscal environment of the Petroleum Title, or any change to
such environment or implications arising after the Completion Date; or
(v)
the accuracy or reliability of any information or material which was

created by persons other than the Farmor and which was provided to the
Farmee in connection with the Farmin Interest or the transaction
contemplated by this agreement.
8
A party is not liable to make any payment for breach of warranty under this
agreement unless the amount of a claim exceeds the Claim Threshold set out in
Schedule 1 in which event the party is liable for the whole of that amount, not
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(d)
(iv)
merely the excess.

(e)
A party must not recover more than once in respect of a matter giving rise to a
claim.
(f)
Any claim by a party for a breach of warranty or representation under this

agreement is taken to be waived or withdrawn and is barred and unenforceable
on and after the date which is 12 months after the Completion Date unless
proceedings in respect of such claim are commenced within 6 months from the
Completion Date.
Earning of Farmin Interest
5.1
Earning Obligation
(a)
(b)
5.2
During the Earning Period the Farmee must:

(i)
undertake, incur and satisfy the Earning Obligation; and
(ii)
pay all monies in respect of the Farmin Interest it has agreed to pay under
this agreement on or before the due date, or otherwise as the Farmor
directs.
If there is a Cost Cap specified in Schedule 1, and the cost to the Farmee of the
Earning Obligation exceeds the Cost Cap (Excess Cost), the Farmee must pay or
reimburse all of the expenditure incurred in performing the Earning Obligation
up to the limit of the Cost Cap. Thereafter the Excess Cost to be paid in
performing the Earning Obligation must be paid or reimbursed by the Farmor
and the Farmee in proportion to their interest in the Petroleum Title as it is
agreed to be at the Effective Date, or as otherwise agreed.
Completion of Earning Obligation

(a)
The Earning Obligation is satisfied and completed under this agreement if:
(i) to the extent that the work or expenditure specified in the Earning Obligation
is required to satisfy a relevant commitment under the Petroleum Title, the
relevant Authority accepts that the work or expenditure satisfies the
relevant commitment, and the Farmee has spent the remainder of the
money or completed the remainder of the work (if any) specified in the
Earning Obligation; or
(ii) a well drilled as part of the Operations:
A.
encounters impenetrable substances, basement,

quantities of Petroleum at a lesser depth; or
commercial
B.
is forced to be abandoned because of difficulties insurmountable by

employing modern drilling technology in conformity with sound,
cost effective practices generally accepted in the international
petroleum industry,
and:
the relevant Authority accepts that the work or expenditure specified
in the Earning Obligation is sufficient to satisfy the relevant well
commitment under the Petroleum Title; or
D.
the Farmee has spent the amount of money or completed the work
specified in the Earning Obligation.
9
If the cost of satisfaction and completion of the Earning Obligation is less than that
provided for in this agreement, the Farmee will nevertheless earn the Farmin Interest
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(b)
C.
and is not obliged to pay any costs greater than the actual cost of satisfying and
completing the Earning Obligation.
5.3
Risk and indemnity
(a)
The Farmor retains all risk and liability of any nature connected with ownership
of and operations undertaken in connection with the Farmin Interest on or prior
to the Effective Date and agrees to indemnify, defend and hold the Farmee
harmless from all costs, liabilities, penalties, claims, causes of action, demands,
lawsuits and expenses (including without limitation, court costs and reasonable
legal fees) associated with such ownership or arising out of any operation,
accident, act, event or circumstance occurring prior to the Effective Date.
(b)
The Farmee assumes all risk and liability of any nature connected with the
ownership of and operations undertaken in connection with the Farmin Interest
from the Effective Date and agrees to indemnify, defend and hold the Farmor
harmless from all costs, liabilities, penalties, claims, causes of action, demands,
lawsuits and expenses (including without limitation, court costs and reasonable
legal fees) associated with such ownership or arising out of any operation,
accident, act, event or circumstance occurring on or after the Effective Date.
Party covenants
6.1
Farmee covenants
During the Earning Period, the Farmee covenants for the benefit of the Farmor to:
6.2
(a)
not prejudice by any act or omission the good standing of the Petroleum Title
under the Act;
(b)
comply with the Act, the terms and conditions of the Petroleum Title, and all
other Laws that relate to the Petroleum Title or the performance of Operations
under this agreement;
(c)
not create or permit the creation of any Encumbrance over the Farmin Interest,
other than an Excepted Encumbrance;
(d)
not sell, assign or otherwise deal with or dispose of the whole or any part of its
interest in the Petroleum Title, except with the prior consent of the Farmor;
(e)
complete all the minimum work obligations under the Petroleum Title which are
part of the Earning Obligation; and
(f)
waive any right it may have to withdraw from this agreement until it has fully
satisfied the minimum work and expenditure obligations that form part of the
Earning Obligation.
Farmor covenants
promptly provide to the Farmee any Information relating to the Petroleum Title
that it receives at the expense of the Farmee;
(b)
keep the Farmee fully informed of material matters relating to the Farmin
Interest, including any proposed budget and the receipt of any Information;
(c)
inform the Farmee of any changes to the facts in the representations and
warranties given under this agreement of which it becomes actually aware,
having made due and careful inquiry, prior to the Completion Date;
(d)
advise the Farmee of any proposed assignment or dealing affecting any interest
in the Petroleum Title of which the Farmor becomes aware;
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(a)
10
During the Earning Period, the Farmor covenants for the benefit of the Farmee to:
(e)
not agree to terminate or make any amendment or variation to the Petroleum

Title without the consent of the Farmee (which consent is not to be unreasonably
withheld or delayed);
(f)
discharge its obligations and duties under the Petroleum Title and the Act in
respect to the Farmin Interest;
(g)
promptly notify the Farmee and provide details upon the occurrence of:
(i)
any written notice of default or termination received or given by the

Farmor with respect to the Farmin Interest;
(ii)
any written notice of any pending or threatened claim, demand, action,

suit, inquiry or proceeding related to the Farmin Interest;
(iii) any event or condition that would have a material adverse effect on the
business, operations, financial condition or results of Operations affecting
the Farmin Interest taken as a whole; or
(iv)
any event or condition that would render impossible the Farmees right to
the assignment of the Farmin Interest;
(h)
not create or permit the creation of any Encumbrance over the Farmin Interest
other than an Excepted Encumbrance; and
(i)
promptly notify the Farmee of any notice or communication received by the

Farmor from any Authority which in any way affects the Farmin Interest or from
any third party which in the Farmors opinion, acting reasonably, materially and
directly affects the Farmin Interest.
Assignment
7.1
Assignment by Farmor
The Farmor may sell, assign or dispose of any legal or beneficial interest in the
Petroleum Title, except that during the Earning Period the Farmor must not sell, assign,
charge, declare a trust over, or dispose of any legal or beneficial interest in the Farmin
Interest except subject to and in accordance with the terms of this agreement.
(a)
The Farmee may not assign, transfer, charge or declare a trust of any of
its rights or interests under this agreement without the prior written approval of
the Farmor, which approval must not be unreasonably withheld or delayed.
(b)
The Farmor may not withhold approval of a proposed assignment by the

Farmee to an Affiliate provided the assignment is made in compliance with the
Act and the Petroleum Title and the assignment results in both the Farmee and
the assignee being jointly and severally liable for the Farmees obligations under
this agreement.
PRRT, income tax and CGT
8.1
PRRT credits transfer notice
(a)
Within 60 days after the Completion Date, the Farmor must provide the Farmee
with a transfer notice in accordance with section 48 (3) or section 48A (11) of
the PRRT Act, and in the form required by the Australian Tax Office (Transfer
Notice) setting out the total expenditure taken to be incurred by the Farmee in
respect of the Farmin Interest.
(b)
If as a result of an audit of the Farmor or the Farmee undertaken under the PRRT
Act, the total expenditure taken to be incurred by the Farmee under sections 48
11
Assignment by Farmee
7.2
or 48A of the PRRT Act in respect of the Farmin Interest differs from the
expenditure recorded in the Transfer Notice, the Farmor must as soon as
practicable provide the Farmee with a Transfer Notice, in replacement of the
Transfer Notice previously given, setting out the actual total expenditure taken to
be incurred by the Farmee under sections 48 or 48A of the PRRT Act in respect
of the Farmin Interest.
8.2
PRRT Information
The Farmor must make available to the Farmee in a timely manner any records,
documentation and other information in its possession or available upon enquiry as the
Farmee may reasonably request in order for the Farmee to verify, substantiate and
deduct the expenditure identified in the Transfer Notice.
8.3
8.4
Recognition of income and expenses
(a)
The parties agree that the Transfer Time (as defined in the PRRT Act) is
the Completion Date and the entitlement of the Farmee and the Farmor to PRRT
expenditure pursuant to sections 48 or 48A of the PRRT Act is determined as at
that date.
(b)
The Farmor must recognise the income and expenditures attributable to

the Farmin Interest for income tax and PRRT purposes for all periods up to the
Effective Date.
(c)
The Farmee must recognise the income and expenditures attributable to

the Farmin Interest for income tax and PRRT purposes for all periods on and
after the Effective Date.
(d)
The Farmee must claim a PRRT deduction for any eligible PRRT
expenditure contributed by the Farmee for the Earning Obligation including the
Past Expenditure Amount, if any.
(e)
The parties must file all income tax returns on the same basis as
provided in this clause.
Value for CGT purposes
For the purposes of assessing capital gains tax payable under the Income Tax
Assessment Act 1997 (Cth) (CGT) (if applicable), the parties agree that each Petroleum
Title has the characteristics and value set out in Schedule 1.
Goods and Services Tax
9.1
Any reference in this clause to a term defined or used in the A New Tax System
(Goods and Services Tax) Act 1999 (Cth) (GST Act) is, unless the context
indicates otherwise, a reference to that term as defined or used in that Act.
(b)
Except where otherwise expressly stated, any amount referred to in this

agreement which is relevant in determining a payment to be made by one of the
parties to the other is, unless indicated otherwise, a reference to that amount
expressed on a GST exclusive basis.
(a)
The parties agree that the assignment of the Farmin Interest constitutes the
supply of a going concern and, as understood by the parties, is GST free.
(b)
The Farmor warrants that it is registered or required to be registered for GST and
will remain so until the Completion Date.
12
Supply as a going concern
9.2
(a)
(c)
The Farmor warrants that, subject to the rights of the Farmee under this
agreement, it will carry on the enterprise constituted by the Farmin Interest until
the Completion Date.
(d)
The Farmee warrants that, subject to the rights of the Farmor under this
agreement, it will supply all things necessary for the continued operation of the
enterprise constituted by the Farmin Interest between the Agreement Date and
the end of the Earning Period.
(e)
Notwithstanding the understanding of the Farmor and the Farmee that this
farmout constitutes the supply of a going concern and is GST-free, if for any
reason the farmout of the Farmin Interest is not accepted by the Commissioner of
Taxation (CoT) in its entirety as a GST free supply of a going concern and is
entitled to recover the GST payable by the Farmor in respect of the disposal:
(i)
the Farmee must pay to the Farmor an amount equal to the amount of the
GST payable by the Farmor in respect of the disposal within 14 days after
the CoT confirms the Farmors liability to GST in an assessment or
correspondence, together with an amount equal to any penalties or interest
imposed on the Farmor in respect of that amount;
(ii)
the Farmor must give the Farmee a copy of the assessment or

correspondence received from the CoT and issue a tax invoice as a
precondition to payment by the Farmee; and
(iii) it will not be a defence to any claim for payment pursuant to this clause
that the Farmor failed to mitigate its damages by paying an amount of
GST when it fell due.
9.3
GST payable on other supplies
(a)
If GST is imposed on a supply made under or in connection with this agreement

(other than the supply constituted by the farmout of the Farmin Interest), the
consideration for the supply is increased by an amount equal to the consideration
otherwise payable for the supply multiplied by the rate at which the GST is
imposed under the GST Act. The additional consideration is, subject to the
supplier issuing a tax invoice to the recipient, payable at the same time and in the
same manner as the consideration to which it relates.
(b)
If one of the parties to this agreement is entitled to be reimbursed or indemnified

for a loss, cost, expense or outgoing incurred in connection with this agreement,
then the amount of the reimbursement or indemnity payment must be reduced by
an amount equal to any Input Tax Credit (as defined in the GST Act) to which
the party being reimbursed or indemnified (or its representative member) is
entitled in relation to that loss, cost, expense or outgoing.
10 Default
If the Farmee fails to pay or reimburse any amount which falls due, or if the
Farmee is otherwise in default of its obligations under this agreement, and such
failure or default is not remedied within 14 days, the Farmor may give to the
Farmee notice of default and of its intention to terminate this agreement.
(b)
If the Farmee does not wholly satisfy the Earning Obligation within the time
provided by this agreement to the satisfaction of the Farmor, acting reasonably,
and such failure is not otherwise excused under this agreement, the Farmor may
also by notice terminate this agreement and the JOA (if executed).
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(a)
13
10.1 Termination for default
(c)
Unless the Farmee remedies the default within 10 days of receipt of the notice of
default given by the Farmor, the Farmor may terminate this agreement forthwith
by further notice to the Farmee.
(d)
The Farmee may terminate this agreement at any time by notice in writing to the
Farmor if the Farmor has:
(i)
breached a material provision of this agreement, provided that such breach

has not been waived by the Farmee or remedied by the Farmor (if capable
of remedy) within 14 days after receiving notice of the breach from the
Farmee; and
(ii)
such breach is continuing at the time of termination.
10.2 Consequences of termination
(a)
Immediately upon either party giving a notice of termination under this

agreement, the Farmee must, if the Farmor so by notice requires:
(i)
if any Authorisation or Approval and Registration in respect of the

Petroleum Title forming part of the Farmin Interest required by this
agreement has not yet been obtained, withdraw its application for such
Authorisation or Approval and Registration forthwith;
(ii)
execute and deliver to the Farmor all documents necessary to re-assign and
re-transfer the Farmin Interest to the Farmor with the result that the
Farmee;
A.
ceases to have an interest in the Petroleum Title and the JOA (if
executed); and
B.
is deemed to have withdrawn from this agreement in respect to the

Petroleum Title;
(iii) do everything necessary on the Farmees part to restore the Farmors

rights, title and interests in the Petroleum Title to the same position as it
was immediately prior to the Agreement Date including:
B.
execute and deliver to the Farmor any other documents necessary to

restore the Farmors rights, title and interest in the Petroleum Title to
the same position as it was immediately prior to the Agreement
Date; and
C.
return to the Farmor (or destroy at the Farmors request) all

Disclosure Materials held by the Farmee, including all copies, other
than Disclosure Materials the Farmee is required to retain by law;
and
return to the Farmor (or destroy at the Farmors request) all Disclosure
Materials held by the Farmee, including all copies, other than Disclosure
Materials the Farmee is required to retain by Law.
If the notice of termination of this agreement has been validly given by the
Farmee under this agreement, upon the Farmor receiving the Disclosure
Materials required to be returned by the Farmee, the Farmor must reimburse to
the Farmee forthwith all amounts that the Farmee has paid to or on behalf of the
Farmor under this agreement in respect of the Farmin Interest.
14
(b)
the obtaining of all Authorisations required under the Act or

otherwise to enable the delivery to the Farmor of a fully effective
Deed of Assignment and Assumption and a Transfer (if required
under the Act) of the Farmin Interest in favour of the Farmor;
(iv)
A.
(c)
Upon valid termination of this agreement by either party, this agreement is at an

end, other than for this clause and the provisions relating to confidentiality,
notices, dispute resolution (if applicable), applicable law and jurisdiction, and
any outstanding payment or reimbursement obligations.
(d)
Termination of this agreement by either party is without prejudice to any other

rights or remedies that either party may have which accrues prior to the date of
termination or otherwise from a partys failure to meet its obligations under this
agreement.
(e)
If the Farmee fails or refuses to execute and deliver any of the documents
required under this clause, the Farmee authorises the Farmor, on its behalf and in
its name, to do all such acts and execute all such documents at the sole cost and
expense of the Farmee as may appear to the Farmor (acting reasonably) to be
necessary or desirable to give effect to the re-assignment and re-transfer
provided for in this clause, and the Farmee is bound by all acts of the Farmor
pursuant to this clause.
11 Force Majeure
11.1 Meaning of Force Majeure
In this agreement, Force Majeure means any cause which is not reasonably within
the control of the party claiming relief under this clause, which cause may include:
(a)
an act of God, earthquake, lightning, fire, flood, storm, cyclone, explosion or

epidemic;
(b)
strike, lockout, stoppage, ban or other types of labour difficulty whether at the
Title Area, railway or port or otherwise;
(c)
war (whether declared or undeclared), blockade, act of the public enemy, act of
terrorism, revolution, insurrection, riot, civil commotion, sabotage, malicious
damage, radioactive contamination, toxic or dangerous chemical contamination;
(d)
action or inaction by a competent Authority (including heritage related restraints

and refusal or failure to grant any Authorisation despite timely reasonable
endeavours to obtain the same);
(e)
inability to access all or any part of a Title Area because of claims to or rights of
native title or otherwise;
(f)
unavailability or mechanical and electrical breakdown and failure of equipment,

plant, pipelines, transmission lines or transport; or
(g)
any other cause whether specifically listed above or otherwise which is not
reasonably within the control of the party claiming Force Majeure
except where:
(h)
the cause is the inability to obtain, use or pay, moneys for any reason; or
(i)
the consequences of the cause could have been prevented or remedied by the
exercise by the party affected of Good Australian Oilfield Practice.
11.2 Relief
If, as a direct result of an event or occurrence of Force Majeure (Force Majeure Event),
a party becomes unable, wholly or in part, to perform an obligation (other than an
obligation to obtain, use or pay money) under this agreement (Affected Party):
15
that Affected Party may give the other party notice of the Force Majeure Event
with reasonably full particulars and, insofar as is known to it, the probable extent
P
(a)
to which it will be unable to perform, or be delayed in performing, that obligation;

(b)
on giving the notice of the Force Majeure, that obligation is suspended, but only to
the extent that, and for so long as, it is affected by the Force Majeure Event;
(c)
the Affected Party must use all reasonable diligence to remove, overcome or abate
the effect of the Force Majeure Event as quickly as possible;
(d)
if the Force Majeure Event cannot be removed, overcome or abated to an extent

that allows resumption of performance within 6 months (or such other period as
the parties agree) from the date of the notice, the parties must consider and
determine whether this agreement needs to be modified or terminated; and
(e)
notwithstanding the Force Majeure Event, the parties must continue to expend
such monies as are necessary to keep the Petroleum Title in good standing in
accordance with Good Australian Oilfield Practice.
11.3 Labour disputes and native title matters
The obligation to use all reasonable diligence to overcome or remove the effect of the
Force Majeure does not require the Affected Party to:
(a)
settle any strike, or other labour dispute;
(b)
contest the validity or enforceability of any law, regulation or legally enforceable

order by way of legal proceedings; or
(c)
enter into any agreement or settle any dispute concerning native title rights or
claims,
on terms not acceptable to it solely for the purpose of removing the event of Force
Majeure.
11.4 Resumption
The Affected Party must resume performance of its obligations as soon as, and to the
extent that, it is no longer affected by the Force Majeure Event.
12 Confidentiality
12.1 Agreement is confidential
(a)
The parties acknowledge and agree that:

(i)
the terms and conditions of this agreement; and
(ii)
all information (including Information) flowing to any party from, or in

relation to, Operations,
(collectively Confidential Information) are confidential to the parties and

commercially sensitive other than information which is already within the public
domain independently of any breach by a party of this agreement.
(b)
To the extent permitted by the Personal Property Securities Act 2009 (Cth)
(PPSA), the parties agree to keep all information of the kind mentioned in section
275(1) of the PPSA confidential and not to disclose that information to any other
person, except as permitted by this agreement.
12.2 No disclosure except as permitted
16
Except as permitted by this agreement, each party undertakes that it will keep
confidential all Confidential Information received by it and that neither it nor its
employees will, without the consent of the other party, disclose any Confidential
Information to any third party.
12.3 Permitted disclosure by a party

(a)
A Party may disclose Confidential Information:

(i) to the professional advisers or agents of that party;
(ii) to an Affiliate of that party;
(iii) as required by Law or by any competent Authority, whether the obligation
arises as a consequence of the act of the party or otherwise;
(iv) to any recognised stock exchange which requires disclosure pursuant to its
listing rules;
(v) where reasonably necessary for the purposes of any arbitration or
administrative or legal proceedings involving only the parties; or
(vi) to a third party, and its advisers, bona fide tendering for or negotiating the
purchase or financing of all or part of the business of that party which
includes the Petroleum Title but only if the third party and its advisers first
covenant in writing to the disclosing party to preserve confidentiality of
information disclosed in the same terms as this clause.
(b)
A party making a permitted disclosure under this clause must take all reasonable
steps to ensure that the person to whom disclosure is made keeps confidential all
Confidential Information disclosed.
12.4 Confidential Information disclosed only as necessary
(a)
Each party must take all steps reasonably necessary to ensure that Confidential
Information obtained is disclosed to and known by only those persons who need to
acquire that knowledge in the course of their duties.
(b)
Each party may use for its own internal purposes not related to Operations any
geological, geophysical, geochemical, metallurgical or operational concept, model
or principle of any kind, even if derived from the Confidential Information.
12.5 Publicity and disclosure
(a)
Except for an announcement or other disclosure required by Law or permitted by

this agreement, no public announcement naming a party or other public disclosure
may be made in relation to Operations unless the text of the announcement or
disclosure has been approved by the other party.
(b)
To the extent that an announcement or other disclosure is required by Law, the

parties must use all reasonable endeavours to agree, as soon as reasonably
practicable, the wording of such announcement or disclosure before it is made.
12.6 Access to Information
(a)
Each party is entitled to full disclosure of all Information available to the other
party in respect of Operations or any other operations carried out by the other
party in the Title Area.
(b)
No party is required to disclose to the other party the modelling, assessment or

development it makes from such Information.
(c)
If Information has been provided to a party under an intellectual property licence

which precludes provision to the other party, the obligation to provide such
information is restricted to the extent provided in the relevant licence.
13 Expert determination
17
13.1 Technical disputes
(a)
If any dispute arises out of, or in connection with, this agreement which is
primarily of a technical or engineering nature either party may, on giving notice to
the other party, refer the dispute to a technical expert to resolve the dispute who
will act as an expert and not as an arbitrator.
(b)
If the parties do not agree on an expert within 14 days of a party giving notice,
either party may request The Institute of Arbitrators & Mediators Australia, or its
successor organisation, to appoint such expert.
(c)
The expert must endeavour to resolve the dispute in accordance with, and subject
to, The Institute of Arbitrators & Mediators Australia Expert Determination Rules.
(d)
An agreement to submit a dispute to the decision of a technical expert is

irrevocable and the parties must seek a decision from the expert appointed without
undue delay and are bound by the award or awards made by the expert without
further right of appeal.
14 Notices
14.1 Form of Notice
Unless expressly stated otherwise in this agreement, any notice, certificate, consent,
approval, waiver or other communication in connection with this agreement (Notice)
must be in writing or given by electronic transmission, signed by the sender (if an
individual) or the person nominated by a party in the Particulars, or by notice given in
accordance with this agreement, as its Authorised Officer, and marked for the attention
of that person as Authorised Officer identified in the Particulars or, if the recipient has
notified otherwise, then marked for attention in the last way notified.
14.2 When Notices are taken to have been given and received
(e)
A Notice is regarded as given and received:

(i)
if delivered by hand, when left at the address given in the Particulars;
(ii)
if sent by pre-paid post, on the 3rd day following the date of postage;
(iii) if given by fax, on production of a transmission report by the machine from

which the fax was sent which indicates that the fax was sent in its entirety to
the recipients fax number, unless the recipient informs the sender that the
Notice is illegible or incomplete within 4 hours of it being transmitted; or
(iv)
(f)
if sent by email, at the time shown in the delivery confirmation report

generated by the senders email system which indicates that the email was
sent to the recipients email address.
A Notice delivered or received other than on a day on which trading banks are
open for business in the capital city of the Nominated State or after 5.00pm
(recipients time) is regarded as received at 9.00am on the following day that such
trading banks are open for business. A Notice delivered or received before 9.00am
(recipients time) is regarded as received at 9.00am.
15 Ancillary provisions
15.1 Entire agreement
This agreement contains everything the parties have agreed in relation to the subject
matter it deals with. No party can rely on an earlier written document or anything said
or done by the other party, or by a director, officer, agent, employee or contractor of
that party, before this agreement was executed, save as permitted by law.
18
15.2 Severability
If any provision of this agreement is void, illegal or unenforceable, it may be severed

without affecting the enforceability of the other provisions in this agreement.
15.3 Waiver
A waiver of any right, power or remedy under this agreement must be in writing signed
by the party granting it. A waiver is only effective in relation to the particular
obligation or breach in respect of which it is given. It is not to be taken as an implied
waiver of any other obligation or breach or as an implied waiver of that obligation or
breach in relation to any other occasion.
15.4 Amendment
No modification, variation or amendment of this agreement is of any force unless it is

in writing and has been signed by each of the parties.
15.5 Counterparts
This agreement may be executed in any number of counterparts and by different

parties in separate counterparts. Each counterpart when so executed is deemed an
original but all of which together constitute one and the same instrument. Delivery of
an executed signature page of a counterpart by facsimile transmission or in Adobe
Portable Document Format (PDF) sent by electronic mail takes effect as delivery of an
executed counterpart of this agreement. Each party must be provided with an original
of the executed signature page as soon as reasonably practicable thereafter
15.6 Applicable law
(a)
This agreement is governed by and must be construed in accordance with the

laws of the Nominated State.
(b)
The parties submit irrevocably to the non-exclusive jurisdiction of the courts of

the Nominated State and all courts competent to hear appeals from those Courts.
15.7 No reliance or inducement
Without limiting any express representation, warranty or acknowledgement provided

for in this agreement, each party warrants and agrees that when entering into this
agreement it relied exclusively on the following matters independently of any
statements, inducements or representations made by, or on behalf of the other party
(including without limitation by the officers, employees, contractors, professional
advisers or agents or any other person acting on behalf of a party):
(a)
its own inspections, investigations, skill and judgement;
(b)
the terms expressly contained in this agreement; and
(c)
opinions and advice obtained independently of any other party.
15.8 Further assurances
Each party must execute all documents and do all things reasonably necessary or
desirable to give full effect to:
(a)
this agreement; and
(b)
any matter or thing contemplated pursuant to this agreement.
15.9 Fees and charges
19
Each party must bear its own costs for the preparation, execution,
delivery and performance of this agreement and any agreement or document
entered into or signed under this agreement.
P
(a)
(b)
All Duties relating to the execution, registration and performance of this

agreement, and of all other documents arising out of this agreement, must be
paid by the Farmee, except that the Farmor must pay all Duties and costs in
relation to the re-assignment of the Farmin Interest to the Farmor if the Farmee
terminates this agreement for breach by the Farmor of a material provision of
this agreement
15.10 Power of attorney
20
Each attorney that executes this agreement states that the attorney has no notice that
the power of attorney under which they were appointed has been revoked.
Schedule 1
Basic Particulars
Act:
[Insert applicable Petroleum Act(s) or other legislation]

[e.g. Offshore Petroleum and Greenhouse Gas Storage Act
2006 (Cth) and all subordinate legislation and directions
in effect under it.]
(Clause 1.1)
Approvals Period:
[Insert] months from the Agreement Date, or such

longer period as the parties may agree.
(Clause 1.1)
Claim Threshold:
(Clause 4.6(d))
[Insert amount and whether it applies to a single claim or a

series of claims.]
Conditions Precedent:
[Examples only]
(Clause 1.1)
1.
The obtaining by [specify party] of all Authorisations required

under [specify legislation] by [insert date].
This Condition Precedent 1 is for the benefit of the parties and
may be waived by each party in whole or in part by giving
notice to that effect to the other party.
2.
The obtaining by [specify party] of the approval of [specify

native title/indigenous party] to the assignment and
assumption of the Indigenous Agreement to the Farmee to the
extent of the Farmin Interest and the release of the Farmors
future obligations under the Indigenous Agreement to the
extent of the Farmin Interest by [insert date].
may be waived by each party in whole or in part by giving
notice to that effect to the other party.
3.
[other - specify Authorisation required, and party required to

obtain it] by [insert date]].
may only be waived by agreement between the parties.
4.
The obtaining by [specify party] of all [assignments of the

following third party agreements required under [specify
legislation] by [insert date].
may only be waived by agreement between the parties.
Cost Cap:
[Insert amount]
(Clause 5.1)
Earning Obligation:
(Clause 1.1)
The Farmee reimbursing agreed past costs of the Farmor as set

out in Schedule [insert Schedule used].
2.
The Farmor being free carried by the Farmee to the extent of

some/all of the Farmors Percentage Share of the future work
program (including/excluding the costs of the proposed
[
] well).
P
1.
21
[Insert work and $ amount].

[Examples only]
3.
The Farmee paying some/all costs of the 2D/3D seismic

[specify] to be shot over the Petroleum Title.
4.
The Farmee paying some/all costs of one or more wells.
5.
The Farmee paying uplift payments and/or royalties to the

Farmor on the issue of a production licence or retention lease.
Earning Period:
[Insert period] from the Completion Date.
(Clause 1.1)
Effective Date:
[Insert date].
(Clause 1.1)
Excepted Encumbrances: [List, if any]

(Clause 1.1)
[Example only]
Royalties, duties, or taxes payable under existing State or

Commonwealth legislation.
Farmin Interest:
[Insert number] % Interest.
(Clause 1.1)
Indigenous Agreement:
(Clause 1.1)
Agreement dated
[insert parties]
[insert
date]
Nominated State:
[Insert relevant State or Territory].
and
made
between
(Clause 1.1)
Operator:
[Insert name of party].
(Clause 3.3(b)(iii))
Past Expenditure Amount: [Insert $ amount].

(Clause 1.1)
Value:
[Wildcat exploration area]

[Nil].
22
Characteristics:
(Clause 1.1)
Petroleum Title:
Schedule 2
Petroleum Titles as at the Effective Date
No.
Reg. Holder(s)
Grant date
Expiry date
[OR: Attach copies of Petroleum Titles]
Annex to Schedule 2
Title Area Map
23
[Insert, if required]
Schedule 3
Disclosure Materials
Category
Document Name
Technical
Financial
Legal
Specific disclosures [Example only]
made by the Farmor to the Farmee in respect of the Farmors warranties under this
agreement
1.
Each Petroleum Title in the Farmout Area expires on the dates stated in Schedule
2 which expiry may result in termination or surrender of a portion of the area of
the Petroleum Title.
made by the Farmee to the Farmor in respect of the Farmees warranties under this
agreement:
[Specify]
1.
24
Schedule 4
Joint Operating Agreement
[Delete, if inapplicable].
[Joint Operating Agreement ]
[the AMPLA Model Petroleum [Exploration] Joint Operating Agreement published on

the AMPLA website at www.ampla.org as at the Agreement Date with the following
amendments:
[specify]
25
[Other]
Schedule 5
26
Deed of Assignment and Assumption
Signing page
EXECUTED by
in accordance with
)
section 127(1) of the Corporations Act
)
by authority of its directors:
............................................................
) Signature of director
)
............................................................
) Name of director (block letters)

)
)
............................................................
) Signature of director/company secretary*

) *delete whichever is not applicable
)
............................................................
) Name of director/company secretary*

(block letters)
)
*delete whichever is not applicable
)
SIGNED, SEALED AND DELIVERED )

by
)
as attorney for
)
)
............................................................
under power of attorney registered No.
in the presence of:
)
)
)
............................................................
Signature of witness
............................................................
Name of witness (block letters)
)
)
)
)
)
Address of witness
............................................................
............................................................
) By executing this deed the attorney states

that the attorney has received no notice of
)
revocation of the power of attorney
)
Occupation of witness
27
............................................................
Petroleum Title Farmout Agreement

Dated
Between
[
] (Farmor)
And
[
] (Farmee)

2203ED, 26.09.14 Model Petroleum Title Farmout Agreement Single Party EXPOSURE DRAFT

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2203ED, 26.09.14 Model Petroleum Title Farmout Agreement Single Party EXPOSURE DRAFT

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Model Petroleum Title Farmout Agreement

Petroleum Farmout Agreement, Alternative & Optional clauses, Exposure Draft

Model Petroleum Title Farmout Agreement

Model Petroleum Title Farmout Agreement

Definitions and interpretation

Coming into effect of agreement

Assignment of Farmin Interest and Completion

Assignment of Farmin Interest

Representations, warranties and acknowledgements

Earning of Farmin Interest

PRRT, income tax and CGT

PRRT credits transfer notice

Goods and Services Tax

Definitions and interpretation

Supply as a going concern

Termination for default

Meaning of Force Majeure

Petroleum Titles as at the Effective Date

Model Petroleum Title Farmout Agreement

Joint Operating Agreement

Deed of Assignment and Assumption

Model Petroleum Title Farmout Agreement

Petroleum Title Farmout Agreement

The Farmor is the beneficial owner, and is entitled to be registered

The parties agree:

Definitions and interpretation

this agreement, including Schedule 3, being a set of disclosures made by the

all files, records, materials, correspondence, documents and other written

Effective Date means the date set out in Schedule 1.

Excepted Encumbrances are the Encumbrances set out in Schedule 1.

loss or damage arising out of Petroleum reservoir or formation damage, or any

loss or damage incurred, or liquidated or pre-estimated damages or penalties of

loss, or anticipated loss, of use, profit or revenue, loss of business reputation,

exemplary or punitive damages; or

suitable and experienced personnel and adequate materials;

the singular includes the plural and vice-versa;

headings do not affect the interpretation of this agreement;

a reference to a party means a party to this agreement as listed in the Particulars

a reference to an agreement, deed, instrument or other document includes the same

a reference to a court is to an Australian court;

a reference to any legislation or legislative provision includes any statutory

a reference to a day, month or year is relevantly to a calendar day, calendar month

a reference to $, AUD or dollars is to the lawful currency of the Commonwealth of

the expressions including, includes and include have the meaning as if

In this agreement, unless the context otherwise requires:

where a word or phrase is defined, its other grammatical forms have a

no rule of construction is to apply to the disadvantage of a party on the basis that

Coming into effect of agreement

Satisfaction of Conditions Precedent

Failure to satisfy Condition Precedent

Consequence of failure to satisfy Condition Precedent

Assignment of Farmin Interest and Completion

Assignment of Farmin Interest

Subject to the satisfaction of the Conditions Precedent, and in consideration of

If a party terminates this agreement by notice for failure to obtain satisfaction of a

the parties acknowledge that no dealing contained in this agreement is of any

On and from the Completion Date and subject to this agreement:

the parties agree to associate themselves in and form a joint venture to

Representations, warranties and acknowledgements

(Incorporation) it is validly incorporated, organised and subsisting in

(Corporate authorisations) all necessary authorisations for the execution,

(No legal impediment) its execution, delivery and performance of this

(Insolvency) no meeting has been convened, resolution proposed or order made

Representations and warranties by the Farmor