C3.pdf

C311333 AMAL HRSG-1 PROJECT

Section C3, General Conditions Rev 2.5 Nov 2010 Page 1 of 42

Petroleum Development Oman LLC

Contract Number C311333

Amal Heat Recovery Steam Generator (HRSG)-1 Project

C3, General Conditions



GENERAL CONDITIONS FOR CONSTRUCTION CONTRACTS – SP-1148

CONTENTS

ARTICLE - 1. DEFINITIONS .................................................................................................... 3

ARTICLE - 2. INTERPRETATION OF THE CONTRACT ............................................................... 7

ARTICLE - 3. WORK .............................................................................................................. 7

ARTICLE - 4. PROGRESS OF THE WORK ................................................................................11

ARTICLE - 5. FORCE MAJEURE ..............................................................................................14

ARTICLE - 6. INSTRUCTIONS AND VARIATIONS TO CONTRACT .............................................15

ARTICLE - 7. MATERIALS AND CONSTRUCTION EQUIPMENT..................................................16

ARTICLE - 8. INSPECTION AND TESTING ..............................................................................19

ARTICLE - 9. SUBSTANTIAL COMPLETION AND COMPLETION ................................................20

ARTICLE - 10. WARRANTY FOR THE WORK .............................................................................21

ARTICLE - 11. SUSPENSION AND TERMINATION .....................................................................22

ARTICLE - 12. PAYMENT.........................................................................................................25

ARTICLE - 13. DUTIES AND TAXES .........................................................................................26

ARTICLE - 14. RIGHT TO AUDIT .............................................................................................26

ARTICLE - 15. OMANISATION .................................................................................................27

ARTICLE - 16. HEALTH, SAFETY AND ENVIRONMENT ..............................................................27

ARTICLE - 17. LIABILITIES AND INDEMNIFICATION ................................................................28

ARTICLE - 18. INSURANCE BY COMPANY ................................................................................30

ARTICLE - 19. INSURANCE BY CONTRACTOR ..........................................................................31

ARTICLE - 20. REPRESENTATIVES OF THE PARTIES ................................................................32

ARTICLE - 21. SUBCONTRACTORS & MANUFACTURERS ...........................................................32

ARTICLE - 22. CONTRACTOR PERSONNEL ...............................................................................33

ARTICLE - 23. LABOUR RELATIONS ........................................................................................34

ARTICLE - 24. LAWS, PERMITS AND REGULATIONS .................................................................35

ARTICLE - 25. OWNERSHIP, PATENTS AND PROPRIETARY RIGHTS ..........................................35

ARTICLE - 26. CONFIDENTIALITY ...........................................................................................38

ARTICLE - 27. BUSINESS ETHICS AND PRINCIPLES .................................................................39

ARTICLE - 28. CLAIMS ............................................................................................................40

ARTICLE - 29. ASSIGNMENT ...................................................................................................40

ARTICLE - 30. APPLICABLE LAW AND DISPUTE RESOLUTION...................................................40

ARTICLE - 31. NOTICES .........................................................................................................42

ARTICLE - 32. SUSTAINABLE DEVELOPMENT ...........................................................................42

ARTICLE - 33. EXCLUSIONS OR LIMITATIONS OF LIABILITY ....................................................42



ARTICLE - 1. DEFINITIONS

The following definitions shall apply to the General Conditions and, unless the context requires

otherwise, to the other Sections forming part of the Contract.

1.1. Affiliates

Shall mean:

In respect of Company

Any corporations, partnerships, trusts, or other entities which have a direct or indirect

ownership interest in Company.

In respect of Contractor, Sub-contractor, or Other Contractor

Any corporations, partnerships, trusts, or other entities which are

a) more than 50% owned by Contractor, Sub-contractor or Other Contractor, or

b) owners directly or indirectly of more than 50% of Contractor, Sub-contractor, or

Other Contractor, or

c) more than 50% owned directly or indirectly by the same entity which owns

Contractor, Sub-contractor or Other Contractor.

1.2. Associated Companies

Shall mean an ultimate holding company of any Company Affiliates and the subsidiaries in any tier in the chain of ownership of such ultimate holding companies where the immediate

parent company has a controlling interest or an ownership interest of fifty percent (50%) or

more.

1.3. Capital Area

Shall mean all locations in the area known as Governate of Muscat in the Sultanate of Oman

in accordance with Royal Decree 6/91.

1.4. Company Group

Shall mean Company, Company Affiliates and Associated Companies and their respective

directors, officers and employees (including agency personnel), but shall not include any

member of Contractor Group.

1.5. Company Personnel

Shall mean all individuals, whether employees or not, engaged on the Work by Company.

1.6. Completion, Substantial Completion, Final Completion

1.6.1. Substantial Completion

Shall mean that the Work, or any part thereof, is ready for operational or functional occupation, when so certified by Company, with due allowance for minor outstanding items

as stated in a list to be agreed between Company and Contractor but with all required tests having been completed. The date of issue of the Substantial Completion certificate shall be

the date on which Contractor is deemed to have achieved Substantial Completion of the

Work or the part of the Work specified in the certificate.

1.6.2. Completion

Shall mean the whole of the Work has been completed in accordance with the requirements of the Contract, when so certified by Company, with no exceptions or outstanding items.

The date of issue of the Completion certificate shall be the date on which Contractor is deemed to have achieved Completion.

1.6.3. Final Completion

Shall mean that a Completion certificate has been issued and that the Warranty Period, including any extension thereof, has expired, when so certified by Company.



1.7. Confidential Information

Shall mean all knowledge, data or information acquired by Contractor from, or disclosed to

Contractor by, Company, or on behalf of Company, in connection with the Work in writing, drawings, magnetic tapes, computer programs or in any other way, as well as all

information, data or information derived there from, to the extent that such knowledge, data or information at the time of such acquisition or disclosure is not either already in the

unrestricted possession of Contractor or part of public knowledge or literature.

1.8. Confidential Record

Shall mean all documents and any other material containing Confidential Information.

1.9. Construction Equipment

Shall mean all transport, construction, testing, inspection and other equipment, tools,

implements, consumables, temporary works and such other items as are required for the realisation of the Work, but excluding Materials.

1.10. Contract Dates

1.10.1. Commencement Date:

Shall mean the date stipulated in Section C1 after which Contractor shall be ready to

commence executing the Work. If no date has been stipulated in the Contract, the Commencement Date shall be the Effective Date.

1.10.2. Completion Date:

Shall mean the date stipulated in the Contract, or as amended by a Variation to Contract in accordance with the terms of the Contract, by which Contractor must achieve Completion of

the whole of the Work.

1.10.3. Effective Date:

Shall mean the date, as stated in Section C1, on which the Contract was awarded or is signed by both parties, whichever is earlier.

1.11. Contract Holder

Shall mean the person appointed as such by Company and named as such in the Contract, having the authorities set forth in the Article 20 herein.

1.12. Contract Manager

Shall mean the person appointed as such by Contractor and named as such in the Contract,

having the authorities set forth in the Article 20 herein.

1.13. Contractor Group

Shall mean Contractor and its Affiliates, its Subcontractor and their Affiliates, its and their

respective directors, officers and employees (including agency personnel), of the aforesaid, but shall not include any member of Company Group. Contractor Group shall also mean

subcontractors (of any tier) of Subcontractors who are performing Work at any Site, their

Affiliates, their directors, officers and employees (including any agency personnel).

1.14. Contractor Personnel

Shall mean all individuals, whether employees or not, engaged on the Work by Contractor or any Subcontractor.

1.15. Contract Price

Shall mean the sum of money stated in the Pricing Summary of C5 Schedule of Prices,

subject to such additions thereto or deductions there-from as may be made under the

provisions of the Contract.

1.16. Country of Operation

Shall mean the Sultanate of Oman. North of Oman shall mean the Operating Area north of 2300000 meters Universal Transverse Mercator (UTM) and South of Oman shall mean the

Operating Area south of 2300000 meters UTM



1.17. Documents

Shall mean all drawings, calculations, computer software (programs), patterns, models,

operation and maintenance manuals and all other manuals and information of whatever nature submitted by Contractor.

1.18. Facilities

Shall mean any of Contractors offices, bases, yards, warehouses, workshops, laboratories,

camps or other installation or facility in the Country of Operation required to complete the

Work.

1.19. Foreign Products

Shall mean all Materials which are not National Products or Products of GCC Origin.

1.20. Instruction

Shall mean communication issued by Company in accordance with the Article 6 herein requiring Contractor to alter all or part of the Work.

1.21. Interior

Shall mean all locations in the Sultanate of Oman outside the Capital Area.

1.22. Key Personnel

Shall mean Contractor Personnel occupying positions defined in the Contract as being Key Personnel.

1.23. Lien

Shall mean a charge or claim by one party on the property of another as security for the payment of a debt or duty.

1.24. Manufacturer or Vendor

Shall mean the person or company which completes the manufacture and/or assembly of

Materials.

1.25. Materials

Shall mean all materials, supplies, consumables, machinery and other items procured and

supplied by Company and/or Contractor to be incorporated in the Work, including spare parts.

1.26. MCI Certificate

Shall mean a certificate issued by the Director General or other competent authority of the

Ministry of Commerce and Industry, certifying that a company is an Omani industrial

company, in relation to the products stated on the MCI Certificate.

1.27. National Products

Shall mean all products entirely produced in the Sultanate of Oman.

1.28. Notices

Shall mean instructions, notifications, agreements, authorisations, approvals and

acknowledgements related to the Contract.

1.29. Omanisation, Omanise and Omanised position

Shall mean the complete and permanent transfer, of a position of employment to an Omani or GCC national. Omanisation of any position, or an Omanised position shall not be deemed

complete until training has been finalised and relevant expatriate Personnel, to be transferred from the position, has forfeited all duties and responsibilities for the position.

1.30. OPAL

Shall mean the Oman Petroleum Alliance (http://www.opaloman.org/), an organisation of Omani oil producers, operators and contractors registered in Oman with the intention to

develop the competences and competitiveness of the Omani people.

http://www.opaloman.org/



1.31. OPAL Compliance Verification Certificate/ Certification or OPAL CVC

Shall mean written confirmation, by an authorised representative(s) of OPAL that an

organisation, company or other commercial entity conforms in all respects to the OPAL minimum criteria of Omanisation.

1.32. Products of GCC Origin

Shall mean all products of which the added value resulting from production in one of the

member states of the Gulf Co-operation Council is not less than 40% of the final value of

such products on completion of production.

1.33. Programme (or Construction Schedule)

Shall mean the detailed Work plan complying with the requirements of the Article headed “Work”. If the term “Construction Schedule” is used in any of the other documents of the

Contract it shall have the same meaning as “Programme”.

1.34. Rates

Prices given in the Contract (Section 5 - Schedule of Rates) which will become due to

Contractor upon completion of stated activities, as and when those activities have been instructed by Company.

1.35. Site

Shall mean all premises, areas, lands, waters and other places where the Work or activities

in connection with the Work are performed including; offices, workshops, camp or messing

facilities for Contractor Personnel and places where equipment, materials or supplies are being obtained, stored or used for the purposes of the Contract.

1.36. Subcontract

Shall mean a contract placed by Contractor or any Subcontractor for the performance of any

part of the Work, including but not limited to the supply of Materials.

1.37. Subcontractor

Shall mean any party to whom any part of the Work has been subcontracted, whether by

Contractor, by a Subcontractor of Contractor, or by a subcontractor of a Subcontractor.

1.38. Technical Information

Shall mean all design data, design standards, calculations, drawings, specifications, and such other information referred to, provided by or caused to be provided by Company pursuant to

the Contract.

1.39. Third Party

Shall mean any party other than Company Group or Contractor Group.

1.40. Variation to Contract

Shall mean any alteration or amendment to the Contract agreed by Company and Contractor

in writing and in accordance with the Procedures for Contractors.

1.41. Warranty Period

Shall mean the period during which Contractor shall be liable for the Work in accordance

with the Article headed “Warranty for the Work”. Unless stipulated otherwise in the Contract, the Warranty Period for the Work or any part thereof shall be eighteen (18)

months from Substantial Completion or twelve (12) months from Completion, whichever period ends first, or as extended in accordance with the provisions of the Article headed

“Warranty for the Work”.

1.42. Work

Shall mean all work to be carried out and all services rendered by Contractor including all

temporary work, design, engineering, procurement, assembly, construction, installation and commissioning work to be performed by Contractor for and in connection with the

permanent and temporary works, the provision and operation of all Construction Equipment,

and all other work and services to be carried out by Contractor under the Contract.



ARTICLE - 2. INTERPRETATION OF THE CONTRACT

2.1. Omissions, errors and ambiguities

2.1.1. Contractor shall ensure that the Work is executed and completed in accordance with the

Contract. Any omissions, errors or other such deficiencies in the Contract shall not relieve Contractor from its obligation to perform the Work in accordance with standards which are

generally accepted by the petroleum industry and gas field practice.

2.1.2. Contractor shall notify Company of any errors, ambiguities or discrepancies, between or within any of the Contract sections, as and when they are identified. Such deficiencies shall

be clarified by Company in writing, and by Instruction if the clarification changes the form, specification, quality or quantity of the Work.

2.1.3. Contractor shall have a duty to mitigate costs arising from a failure to notify Company at the

time an error or ambiguity or discrepancy could reasonably have been identified by an experienced Contractor. Contractor shall be barred from claiming an adjustment of the

Contract Price and the Completion Date unless, in Company's reasonable opinion, the deficiency could not have been reasonably foreseen on or before the Effective Date.

2.2. References, notices and language

2.2.1. All correspondence, documentation and discussion related to the Contract and the Work

shall be in the English language unless specifically instructed otherwise by Company.

2.2.2. All instructions, notifications, agreements, authorisations, approval and acknowledgements shall be in writing.

2.2.3. Unless a reference to an Article specifies either a heading, title or a particular number then such reference shall be deemed to be to the same Article of the Contract within which the

reference appears. Reference to a Clause shall be interpreted in the same way.

2.2.4. No failure on the part of Company to enforce or to require the strict adherence and performance of any of the provisions of the Contract shall constitute a waiver of such

provisions, or affect any of Company's rights under the Contract.

2.2.5. No heading, index, title, subtitle, subheading or marginal note of the Contract shall limit,

alter or affect the meaning or operation of the Contract.

2.2.6. Words imparting the singular include the plural and vice versa where the context requires.

2.2.7. Contractor shall act as an independent contractor with respect to the Work and neither

Contractor nor any Subcontractor nor any Contractor Personnel shall be deemed to be the personnel or a representative of Company.

2.2.8. Any reference to statute, statutory provision or statutory instrument shall include any re-enactment or amendment thereof for the time being in force.

2.3. Effect of illegality

2.3.1. If any provision of the Contract proves unenforceable because it is contrary to any mandatory rule of law, the validity of the remaining provisions of the Contract will in no way

be affected. In such case, the parties shall be bound to perform as intended by the affected provision as closely as possible without infringing any mandatory rule of law.

ARTICLE - 3. WORK

3.1. Work and workmanship

3.1.1. Contractor shall, subject to the provisions of the Contract, and with due care and diligence,

carry out the Work and provide all labour, (including the supervision thereof), Materials, Construction Equipment, consumables and all other items, whether of a temporary or

permanent nature, required for the Work or reasonably inferred from the Contract.



3.1.2. Contractor shall execute the Work in a proper, workmanlike manner with properly equipped

facilities and in accordance with the specifications and standards given in the Contract and in

line with recognised good modern oil and gas industry practice and with the skill to be expected of a reputable contractor experienced in the types of work to be carried out under

the Contract.

3.1.3. Contractor represents that it has the experience, skills, knowledge, capability (including

sufficient and competent supervisory and other Contractor Personnel) and all necessary

facilities and resources to efficiently and expeditiously perform the Work in accordance with the Contract and that it shall provide such expertise, skills, knowledge, capability, facilities

and resources.

3.1.4. In the event that Contractor provides any Materials or Construction Equipment for which

there is no detailed specification included in the Contract and /or any related Purchase Order then these Material or Construction Equipment shall be new or as new, of good quality and

workmanship and fit for the intended purpose required under the Contract.

3.1.5. No review, consent, approval or acknowledgement by Company shall relieve Contractor from any liability or obligation under the Contract.

3.1.6. Notwithstanding the expiry or termination of the Contract, Contractor shall not abandon any Work in progress and shall complete the Work in accordance with the Contract. The terms

and conditions of Contract shall remain in full force and effect during the period required to

complete the Work.

3.2. Supervision by Contractor

3.2.1. Contractor shall provide all necessary supervision during the performance of the Work. Such supervision shall be given by competent persons having adequate knowledge of the

operations to be carried out (including the methods and techniques required, the hazards likely to be encountered and the methods of preventing accidents) as may be required for

the satisfactory performance of the Work.

3.2.2. Contractor shall execute the Work in strict accordance with the Contract and shall comply with and adhere strictly to Company's Instructions and directions on any matter concerning

the Work.

3.3. Protection of Company's interests

3.3.1. Contractor shall at all times perform the Work in a manner that will safeguard and protect

Company's interests and take all necessary steps to prevent abuse or uneconomical use of Materials, facilities, or Construction Equipment made available to Contractor by Company.

3.3.2. Where Company or other contractors of Company are working on the Site then Contractor shall liaise with these other contractors to mitigate any effect or potential effect on the

execution and progress of the Work.

3.4. Information for the Work

3.4.1. Contractor shall be deemed to have satisfied itself, before entering into the Contract as to

the extent and nature of the work, including but not limited to all information which may be needed to perform the Work in accordance with the Contract, the character of the Work,

local conditions and facilities, safety requirements, employment and industrial matters and all other circumstances that may influence or affect the performance of the Contract.

3.4.2. Contractor shall immediately inform Company in writing if it has insufficient information to

commence or proceed with the Work.

3.4.3. Contractor shall be deemed to have obtained all available information as to risks,

contingencies and all other circumstances which may influence or affect the performance under the Contract.

3.4.4. Contractor shall check and verify any information obtained in writing from Company, and

shall advise Company of any errors discovered therein. Company shall not be liable for any inaccuracy or insufficiency in the information given to or used by Contractor, except in the

event and to the extent that such information is supplied by Company under the Contract



and it is clearly impracticable for Contractor to check such information or where the

obligation to check is explicitly waived in the Contract.

3.5. Knowledge of the Site

3.5.1. Contractor warrants to have inspected and examined the Site, its surroundings and

information available in connection therewith and to have satisfied himself as to the form and nature of the Site including the sub-surface conditions, the hydrological and climatic

conditions (which includes heavy rainfall and floods which may occur from time to time and

which could result in the Site and roads becoming temporarily impassable) the extent and nature of all things necessary for the completion of the Work, the means of access to the

Site and the accommodation Contractor may require.

3.5.2. Contractor's undertaking to carry out the Work for the Contract Price shall be deemed to be

based on and made in the light of all above data and conditions and all criteria of design which Company has required Contractor to undertake in carrying out the Work.

3.5.3. Contractor may rely on the accuracy and sufficiency of sub-soil information bound into the

Contract.

3.5.4. If during the execution of the Work Contractor shall encounter artificial physical obstructions

which could not, in the opinion of Company, have been reasonably foreseen by an experienced contractor, Contractor shall forthwith give written notice thereof to Company

and Company shall reimburse the additional expense and establish any potential delays that

Contractor may have incurred as a result of such instructions.

3.6. Cleanliness of the Site

3.6.1. Contractor shall ensure that accumulations of waste material and rubbish on the Site arising out of or in connection with the Work are kept to a minimum and are frequently removed

from the Site or removed at the request of Company.

3.6.2. Upon Completion of the Work Contractor shall leave the Site in a clean and orderly condition

with nothing left buried or hidden. Contractor Representative or Contractor Site

Representative shall remain at the Site until all restoration and cleaning work has been carried out to the satisfaction of Company.

3.7. Urgent Work

3.7.1. If, in the opinion of Company, any work, repair or remedial action is urgently required, either

for the security or safety of the Site or for the progress of work or services being performed

by Other Contractors or for any other reason which justifies immediate action, and Contractor is unable or unwilling to execute such work, repair or remedial action, then

Company may call in Other Contractor and/or utilise such equipment as it requires to carry out any such work, repair or remedial action which it considers necessary. In such case

Company shall be responsible for the operation of such equipment and be liable for any loss

or damage to such equipment.

3.7.2. If the work, repair or remedial action so carried out by Company or an Other Contractor was

Contractor's responsibility then all costs and charges properly incurred shall be recoverable by Company from Contractor. Company shall, as soon as may be reasonably practicable

after the occurrence of any emergency necessitating urgent action as referred to above, advise Contractor thereof in writing.

3.8. Setting out of the Work

3.8.1. Contractor shall be liable for the true and proper setting out of the Work in relation to original points, lines and levels of reference given by Company in writing, for the correctness

of the position, levels, dimensions and alignment of all parts of the Work and for the provision of all necessary instruments, appliances and labour in connection therewith.

3.8.2. If at any time during the execution of the Work any error appears or arises in the position,

levels, dimensions or alignment of any part of the Work Contractor shall inform Company and Contractor shall rectify such error at its own cost.



3.8.3. The checking of any setting out or of any line, level, co-ordinate, or position of a marker by

Company shall not in any way relieve Contractor of its responsibility for the correctness

thereof.

3.8.4. Contractor shall be responsible for the preservation of bench marks, pegs or other marks

used in setting out the Work and shall not remove any pegs or marks without properly fixing such other marks as will enable replacement of them in their original positions. It shall also

be the duty of Contractor to replace all such pegs and marks so removed and if Contractor

fails to replace such pegs and marks when required to do so by Company then the cost of such replacement shall be for Contractor's account.

3.9. Use of explosives

3.9.1. Under no circumstances will the use of explosives be permitted unless the use thereof has

been provided for in the Contract or Company's written approval has been obtained prior to the use of such explosives.

3.9.2. When the use of explosives is permitted Contractor shall use utmost care not to endanger

life or adjacent property, and shall comply with all laws, rules, and regulations governing the hauling, storing, handling or use of such explosives, including the securing of all necessary

permits thereof.

3.10. Support services and facilities provided by Company

3.10.1. Company shall provide to Contractor only those support services and/or facilities, as

stipulated in the Contract, and the provision of such support services and/or facilities is made subject to availability. In the event that Company fails to provide, delays or suffers

interruption in providing such support services or facilities Contractor shall have an obligation to take all reasonable measures to mitigate any effect or potential effect on the

execution and progress of the Work.

3.10.2. Unless stated otherwise in the Contract all Company provided support services and/or

facilities shall be charged to Contractor at: -

a) Net cost where facilities and/or services are provided by a third party; or

b) Applicable internal charge, as established by Company.

3.10.3. Contractor shall be responsible for establishing the level and method of charge to be applied for any Company provided support services or facility prior to its provision.

3.11. Design by Contractor

3.11.1. Contractor shall carry out and be responsible for, the design of the Work, and to the extent required by the Contract, such design shall be included as part of the Work. Design shall be

completed to the requirements laid down in the Contract. Where such requirements are not detailed in the Contract then Contractor shall be required to complete the design on a “fit for

purpose” basis to Industry accepted standards and to the extent required by the Contract.

3.11.2. Contractor holds itself, its designers and design Subcontractors as having the experience and capability necessary for the design. Contractor undertakes that the designers shall be

available to attend discussions with Company at all reasonable times during the Contract Period.

3.11.3. Documentation

Contractor shall prepare Documents in sufficient detail to satisfy all regulatory approvals, to

provide suppliers and construction personnel with sufficient instruction to execute the Work

and to describe the operation of the completed Work. Company shall have the right to review and inspect preparation of Documents wherever they are prepared.

Where required by the Contract documents shall, when ready for use, be submitted to Company for pre-construction review. Unless stated otherwise such review period shall not

exceed twenty-one (21) calendar days from the receipt of Documentation by Company.

If Company instructs that further Documents are necessary to complete the Work, Contractor, upon receiving Company‟s instruction, shall immediately prepare such

Documentation in accordance with the terms of the Contract.



3.11.4. Consent or approval by Company of Design or Documentation in no way relieves Contractor

from the requirement to satisfy itself as to the suitability and capacity of the design and to

satisfactorily execute and complete the Work in accordance with the Contract.

3.11.5. Errors omissions & ambiguities

Errors omissions ambiguities inconsistencies, inadequacies found in the construction Documents shall be rectified by Contractor and all resulting defects in the Work shall be

corrected at Contractor‟s cost.

ARTICLE - 4. PROGRESS OF THE WORK

4.1. Scheduling of the Work

4.1.1. Contractor shall be responsible at all times for scheduling, progress reporting, forecasting

and independently controlling progress of the Work to achieve Completion by the required

Completion Date.

4.1.2. Contractor shall submit an execution plan for the Work together with all reports, forecasts,

calculations and documents supporting the said plan to Company for review. The execution plan shall become the Programme when it complies with the requirements of the Contract

and when approved as such by Company.

4.1.3. Contractor shall use the Programme as the basis for progress reporting, scheduling,

forecasting and controlling the performance of the Work.

4.1.4. Timely Completion of the Work is essential and Contractor shall advise Company in writing as soon as practicable when any factor arises which Contractor considers is likely to have an

effect upon the Completion Date and/or the Programme.

4.1.5. Contractor shall submit to Company, for review, an updated execution plan to include the

effects of any Instruction and actual progress. Unless agreed otherwise by Company then

Contractor's updated execution plan shall provide for Completion by the Completion Date together with all other Contract obligations. Such revision and rescheduling of activities shall

not be considered a Variation to Contract.

4.1.6. Subject to approval by Company this revised execution plan shall become the Programme.

At any one time there shall only be one Programme.

4.2. Delay

4.2.1. Contractor shall advise Company in writing immediately when any factor arises which is

likely to cause delay in the performance of the Work and shall take all reasonable measures to mitigate such delay at no additional cost to Company. Where Contractor, under this

Article considers that a delay affects an agreed time schedule for completion of all or part of the Work, Contractor shall give notice to Company of any such effect within seven (7)

calendar days of the earlier of the delay being envisaged or occurred. Any impact of such

delay on time schedule shall be agreed between the parties, provided that the correct notices have been given.

4.2.2. For delays considered to be attributable to Company, Contractor shall at first indication of delay give notice to Company of any such effect within seven (7) calendar days. Contractor

shall make every effort to re-deploy its resources on the Work in such a way as to mitigate

all effects of delay in progress of the Work and deviation from the Programme and to avoid or to keep to a minimum any increased costs. Company shall compensate Contractor for the

costs of such remedial measures as Company instructs Contractor to take provided that the correct notices have been given. Such compensation shall be subject to detailed

substantiation of Contractor's costs and, to the extent possible, be calculated in accordance with the Rates.



4.3. Rate of Progress

4.3.1. If for any reason directly or indirectly attributable to Contractor, Company is of the opinion

that progress of the Work is delayed or progress is not being maintained on items which, if no actions were taken, would affect the ability of Contractor to achieve Substantial

Completion Date and/or Completion Date, Company shall notify Contractor that it has failed to ensure the execution of the work and Contractor shall within seven (7) calendar days

from the date of the notice take all steps as are necessary, subject to the consent of

Company or, in the event of failure to do so, shall take such reasonable steps as Company may instruct in writing to expedite progress so as to correct such deficiencies in the

execution of the Work as specified in the notice from Company. Contractor shall not be entitled to an extension of time and/or additional cost for taking such steps. If any

instruction issued by Company pursuant to this sub-article causes Company to incur additional costs, such costs shall be recoverable from Contractor by Company and may be

deducted by Company from any monies due or to become due to Contractor.

4.3.2. Company may issue to Contractor reasonable instructions requiring Contractor to procure an increase in the rate of progress of the Work in circumstances where Contractor is not in

default so that Substantial Completion and/or Completion dates are achieved prior to the scheduled Completion Date. Contractor shall be entitled to recover the additional cost

incurred in respect of complying with any such an instruction.

4.4. Duty to report

Contractor shall, within twenty-four (24) hours, or as otherwise specified in the Health,

Safety and Environmental Specifications (Section C9), of any incident:-

a) affecting the progress of the Work, or

b) affecting the quality of the Work, or

c) which is a reportable HSE event (as required by Section C9)

send to Company a detailed report of the incident together with copies of any statements or

reports sent by Contractor to any public authority and/or third party excluding those sent to Contractor's insurance company or its attorneys.

4.5. Summary reports

4.5.1. At the request of Company, Contractor shall submit to Company a summary report of safety

performance and incident/accident statistics related to the Contract. These reports shall

include data in respect of both Contractor and its Subcontractors.

4.6. Inclement weather

4.6.1. “Inclement Weather” means exceptionally adverse weather conditions which could not reasonably have been foreseen by an experienced contractor and which materially affects

the regular progress of the Work.

4.6.2. In the event of Inclement Weather Contractor shall be liable for all costs and expenses incurred by Contractor, including but not limited to:

a) protecting the Work;

b) repair and rectification of the Work;

c) re-establishment of Facilities;

d) delay in completion of the Work; and

e) subsequent resulting effects on the Work.

4.6.3. Contractor shall not be liable for the extent to which the Work is delayed because of inclement weather provided always that Contractor has taken all reasonable steps to protect

the Work and mitigate the effects of the Inclement Weather. Under no circumstances shall the Contract Price be increased for the financial impact on either party of the Inclement

Weather.

4.7. Extension of the Completion Date

4.7.1. If Company by reason of a delay in making the Site available to Contractor, or in supplying

Company supplied Materials or Technical Information or in issuing necessary Company



permits or any other reason which is attributable to Company, causes a delay in the

execution of the Work so as to fairly entitle Contractor, in Company's reasonable judgement,

to an extension of the Completion Date, then, subject to Articles ‎4.7.2, and ‎4.7.3, Company

and Contractor shall negotiate an extension of the Completion Date and compensation for any reasonable additional costs which Contractor shows are directly due to the delay, but

excluding all consequential costs.

4.7.2. An extension to the Completion Date as a result of delay attributable to Company shall only

be granted if it can be demonstrated by Contractor, to the satisfaction of Company, that the

delay suffered by Contractor is a direct consequence of the delay attributable to Company. Any extension to the Completion Date shall not include for the effect of any concurrent

delays in Contractor‟s progress resulting from Contractor‟s failure to perform the Contract obligations diligently.

4.7.3. Company shall be under no obligation to negotiate for, or concede an extension to the scheduled Completion Date or compensate Contractor for increased costs, unless Contractor

has provided the correct notices and information in accordance with the requirements of

Articles ‎6.1.4 and ‎Article - 28.

4.7.4. Articles ‎4.7.1, ‎4.7.2 and ‎4.7.3 shall, mutatis mutandis, also apply to claims by Company for a

reduction of the Contract Price or an acceleration of the Completion Date on account of any alteration to the Work.

4.8. Penalties

4.8.1. If Contractor fails to achieve Substantial Completion of the Work on or before the due date,

Contractor shall pay Company penalties as set out in the Contract for each day or part of a

day that Substantial Completion is delayed beyond the required date up to the maximum of sixty (60) calendar days or such other limit as may have been stated in the Contract.

4.8.2. Unless stated otherwise in the Contract if a Substantial Completion certificate has been issued for part of the Work on or before the Substantial Completion Date, the penalties

payable shall be reduced in the proportion which the value of such part of the Work bears to

the value of the whole of the Work.

4.8.3. If Contactor fails to complete any of the items or events listed in Section C5 - Milestones by

the relevant dates included in the Milestones Schedule and/or fails to achieve the requirements of the Contract in respect of any other item listed in the Milestones Schedule,

Contractor shall be liable for the penalties set out in the Contract.

4.9. Right to recover costs

4.9.1. Where Contractor is in default or, through no fault of Company, exceeds the maximum

duration for application of the penalty, referred to in Article ‎4.8.1, and regardless of whether

or not Company shall have imposed penalties, Company shall be entitled to recover from Contractor costs incurred by Company as a result of this. In addition, Company shall have

the right to impose any other penalties as set out elsewhere in the Contract.



ARTICLE - 5. FORCE MAJEURE

5.1. Except for monies due, neither Company nor Contractor shall be responsible for any failure

to fulfil any term or condition of the Contract if and to the extent that fulfilment has been delayed or temporarily prevented by a force majeure occurrence, as hereunder defined,

which has been notified in accordance with this Article and which is beyond the control and without the fault or negligence of the party affected and which, by the exercise of

reasonable diligence, the said party is unable to provide against.

5.2. For the purpose of the Contract force majeure shall be limited to the following, and only insofar as there is a substantive effect upon the performance of the Contract, which results

in a material change in the direct cost to Contractor of performing the Work:

(a) Riot, war, invasion, act of foreign enemies, hostilities (whether war be declared or not),

acts of terrorism, civil war, rebellion, revolution, insurrection of military or usurped

power;

(b) Ionising radiations or contamination by radioactivity from any nuclear fuel or from any

nuclear waste from the combustion of nuclear fuel or radioactive, toxic, explosive or other hazardous properties of any explosive nuclear assembly or nuclear component

thereof;

(c) Pressure waves caused by aircraft or other aerial devices travelling at sonic or

supersonic speeds;

(d) Earthquake, flood, fire, named cyclone/hurricane/typhoon, tidal wave, explosion and/or other natural physical disaster, (but excluding other weather conditions, such as

Inclement Weather, regardless of severity, which do not lead to one of the aforementioned events);

(e) Strikes at a national or regional level or industrial disputes at a national or regional

level, or strikes or industrial disputes by labour not employed by the affected party its subcontractors or its suppliers and which affect a substantial or essential portion of the

Work;

(f) Maritime or aviation disasters;

(g) Changes to any general or local Statute, Ordinance, Decree, or other Law, or any

regulation or bye-law of any local or other duly constituted authority or the introduction of any such Statute, Ordinance, Decree, Law, regulation or bye-law;



5.3. In the event of a force majeure occurrence, the party that is or may be delayed in

performing the Contract shall notify the other party without delay giving the full particulars

thereof and shall use all reasonable endeavours to remedy the situation without delay.

5.4. If either party is delayed in performing the Contract by a force majeure occurrence, the

Programme but not the Contract Price, except as otherwise expressly provided in the Contract, shall be adjusted in accordance with the Article headed “Instructions and

Variations to Contract” and Article 5.5.

5.5. Upon cessation of any force majeure occurrence Contractor shall prepare a revised execution plan to include for rescheduling of the Work so as to minimise the effects of the

delay and having made due allowance for any instruction to accelerate the Work given in accordance with the Article headed “Instructions and Variations to Contract”, Company shall

authorise a Variation to adjust the Programme in order to take into account any remaining effects of such delay.

5.6. Following notification of a force majeure occurrence in accordance with Article 5.3, Company

and Contractor shall meet without delay with a view to agreeing a mutually acceptable course of action to minimise any effects of such occurrence.

5.7. Obligations of Company and Contractor to pay amounts due to the other party under the Contract or any Subcontract shall not be excused by events of force majeure.

ARTICLE - 6. INSTRUCTIONS AND VARIATIONS TO CONTRACT

6.1. Instructions

6.1.1. Without prejudice to this Contract, or, where applicable, any bond or guarantee, Company

shall, at its sole discretion, be entitled to Instruct any alteration, cancellation or deletion to the form, scope, specification, quality or quantity of the Work including without limitation

alterations to HSE requirements.

6.1.2. Without prejudice to Contractor‟s right to request a Variation to Contract to adjust the Contract Price or extend the Completion Date in accordance with the provisions of this

Article, Contractor shall immediately proceed to carry out such Instruction and shall provide all Construction Equipment and Contractor Personnel necessary to do so.

6.1.3. Subject to Contractor giving notice to Company of additional cost within fifteen (15) calendar

days of the issue of the Instruction, Contractor shall be entitled to reimbursement of properly substantiated additional payments and direct costs, if any, resulting from the issue

of an Instruction. Such additional payments shall be valued using the Rates stated in the Contract where applicable. Direct costs shall include those incurred as a result of

Instructions being issued at short notice thereby making costs unavoidable.

6.1.4. Where Contractor considers that an Instruction affects agreed time schedule for completion

of all or part of the Work, Contractor shall give notice to Company of any such effect within

fifteen (15) calendar days of an Instruction being issued. Any impact of an Instruction on such time schedule shall be agreed between the parties, provided that the correct notices

have been given.

6.1.5. Where Contractor has served the correct notice in accordance with Articles ‎6.1.3 and ‎6.1.4,

full details of any additional payment, estimates of future possible effects, direct cost and /or

impact on agreed time schedule, must be forwarded in writing to Company within sixty (60)

calendar days of the notice being issued, failing which Contractor shall forfeit any right to receive payment for such Variation To Contract and any rights concerning adjustment to the

Contract Price and/or the Programme.

6.2. Confirmation of verbal instructions

6.2.1. Instructions should be issued in writing. However, if Company considers it necessary to

issue an Instruction verbally Contractor shall immediately comply with such verbal request. Where Company confirm a verbal request in writing, either before or after carrying out of

the Work, this shall be deemed an Instruction. If Company does not confirm such a verbal request in writing within seven (7) calendar days then Contractor shall so confirm within a



period of seven (7) further calendar days and shall obtain Company‟s written agreement

which shall be deemed an Instruction.

6.3. Monthly statement of Instructions

6.3.1. Contractor shall submit to Company once every month an account giving full particulars of

all valuation adjustments or extensions of the Completion Date to which Contractor may consider it is entitled during the previous month.

6.4. Variations to Contract

6.4.1. Once the effect of an Instruction or series of Instructions has been evaluated and agreed then they shall be summarised and issued in a Variation to Contract giving full details of the

Value and effect on the Contract duration if any.

6.4.2. Variations to Contract agreed by both parties in accordance with Section C8, the Procedures

for Contractors, shall be the only valid manner of amending the Rates, the Scope of Work and any other document or provision of the Contract.

6.5. Valuation of Variations to Contract

6.5.1. The alterations to the Work shall be valued by Company after consultation with Contractor in accordance with the following principles:

a) where work is of similar character and executed under similar conditions to work priced in the Contract, it shall be valued at such rates and prices contained therein as may be

applicable. Where work is not of a similar character or is not executed under similar

conditions then the rates and prices in the Contract shall be used as the basis for valuation, so far as may be reasonable, failing which a fair valuation shall be made.

Failing agreement between Company and Contractor as to any rate or price to be applied in the valuation of any alteration, Company shall determine the rate or price in

accordance with the foregoing principles and shall notify Contractor accordingly but without prejudice to Contractor's rights under the Article headed “Applicable Law and

Dispute Resolution”;

b) if, in the opinion of Company, the rates and prices are either not applicable or are inappropriate, in determining the cost of an alteration, or part of an alteration, having

regard to the effect of any alteration on the Contract, then Company reserves the right to re-negotiate any applicable Contract Price or Rate with Contractor;

c) if in the opinion of Company alterations to the Work require to be valued on a day-work

basis, which shall only be in circumstances where the method of payment specified in the Contract does not apply to such alteration, then a written order shall be issued. In

respect of all such Work payable on a day-work basis Company and Contractor shall comply with the relevant provisions of the Contract; and

d) the value of any Instruction or Variation to Contract shall not include the costs incurred

by Contractor in administering, compiling or otherwise establishing the validity, or content of the instruction being valued. These costs shall be deemed included within

the Contract Price and Rates.

6.6. Request for an estimate

6.6.1. Notwithstanding the requirements of Article ‎6.5 where Company considers that a proposed

Instruction cannot be valued using the methods available in the Contract then Company may request Contractor to provide an estimate of the cost of any proposed Instruction. If

requested then within seven (7) calendar days, or other duration as agreed with Company,

of having been requested by Company to provide such an estimate Contractor shall submit to Company a fully detailed estimate of the cost of the proposed Instruction. Provision of

such an estimate shall no way affects the rights of Company to value an Instruction in accordance with the terms of the Contract.

ARTICLE - 7. MATERIALS AND CONSTRUCTION EQUIPMENT

7.1. Company supplied Materials and Construction Equipment

7.1.1. Only those Materials and Construction Equipment specifically stated in the Contract as being

supplied by Company shall be provided by Company at the stated location. Contractor shall



examine this list and where appropriate shall utilise such Materials and Construction

Equipment as are available in the execution of the Work and advise Company accordingly.

7.1.2. In respect of Company supplied Materials and Construction Equipment Contractor shall at his own expense:

a) receive, load, transport to the Site and unload as necessary;

b) on taking delivery from Company, inspect all Materials and/or Construction Equipment

to ensure its conformity with Contract requirements and specifications. Contractor shall

immediately notify Company in writing of any default. If no written notification of default is issued to Company before Contractor endorses the receipt of the Materials

and/or Construction Equipment, then the Materials and/or Construction Equipment shall be deemed complete and undamaged and Contractor shall be liable for any damage or

shortage identified at a later date;

c) maintain and store in a proper manner, keep a true and accurate inventory and submit

an updated copy to Company monthly or at Company's request; and

d) account to Company for the use of the Materials and/or Construction Equipment in the Work and for any discrepancies between the monthly inventory report and the Materials

and/or Construction Equipment supplied and used.

e) maintain, operate and use Materials and/or Construction Equipment strictly in

accordance with manufacturers recommended instructions, industry practice and

regulations. Provide all consumables and spare parts, including oil and fuel, for such maintenance and operation or use.

7.2. Risk and ownership of Company supplied Materials

7.2.1. Company supplied Materials and/or Construction Equipment listed in the Contract shall at all

times remain the property of Company, irrespective of where such Materials and/or Construction Equipment are physically located or stored. However, risk of such Company

supplied Materials and/or Construction Equipment will pass to Contractor from the moment

Contractor has taken delivery of such Material and/or Construction Equipment.

7.2.2. Prior to issuance by Company of the Completion certificate, Contractor shall, within a period

specified by Company, return all surplus Materials and/or Construction Equipment supplied by Company in a neat manner properly labelled and documented in accordance with

Company's requirements to Company storage yard of issue.

7.3. Contractor supplied Materials

7.3.1. Contractor shall furnish at its expense all Materials required for the Work which are not listed

in the Contract as being supplied by Company. Contractor shall be fully responsible for all aspects of procurement and supply including but not limited to:

Preparation and despatch of requisitions for tender

Commercial and technical evaluation of tenders

Discussions with Manufacturers

Placing of purchase orders

Expediting and shipping

Inspection

Certification of Manufacturers invoices

Payment

Import into Oman

7.4. Suitability and verification of Materials

7.4.1. Material supplied by Contractor shall conform to the requirements and specifications of

Company as provided in the Contract or, if no such requirements or specifications exist, are

subject to approval by Company and, where Company does not exercise such right of approval, conform to standards generally accepted in the petroleum industry and gas field

practice.



7.4.2. Contractor shall arrange for appropriate warranties enforceable by Company in respect of all

Materials supplied by Contractor. In the event that Materials are supplied which are not in

accordance with the specifications included in the Contract and such non-compliance is approved by Company, Contractor shall arrange for reasonable and practical additional

warranties, the cost of which shall be for Contractor‟s account. The warranties shall only be enforceable by Contractor during the Contract period and by Company after Final

Completion or after Contract termination.

7.4.3. If, in the opinion of Company any item of Material is not, or is no longer, in accordance with the requirements of the specifications then Contractor shall at the option of Company, either

make adequate repairs or arrange for immediate replacement. If, in the opinion of Company, the execution of the Work is slowed down or delayed due to insufficient or below

standard Material, then Contractor shall provide the necessary additional Material to recover such delays at no additional cost to Company.

7.4.4. Original Replacement Parts.

Where relevant Contractor shall ensure that required rectification work is carried out in accordance with the related Manufactures‟ instructions, supervision and using the original

Manufacturers replacement parts.

7.5. Import and export of Materials & Construction Equipment

7.5.1. Contractor shall gather all information relevant to import, export and any other

documentation required and subsequently obtain the import and export and other licenses required for the importation into and use in the Sultanate of Oman of all Materials &

Construction Equipment to be supplied by Contractor and made available from sources outside the Sultanate of Oman.

7.5.2. Contractor shall ensure that applications, including all necessary supporting documents for such import, export and other licenses, are submitted to the appropriate Omani authorities

in sufficient time before the licenses are required. Unless otherwise stated, all imported

Materials & Construction Equipment to be supplied by Contractor shall be imported in accordance with the procedures for importation of materials and equipment included in the

Contract. Contractor shall be responsible for their due and timely importation, clearance, handling, off-loading, storage and transportation to the Site.

7.6. Ownership and duty of care

7.6.1. All Materials supplied by Contractor or any Subcontractor shall, on being delivered to the Site, become the unencumbered property of Company but shall remain in Contractor's care

and custody. Contractor shall be liable for any loss of or damage to all Materials, whilst in Contractor's care and custody. All Contractor supplied Materials shall be timely but not

prematurely delivered to Site and inspected by Contractor. For the purpose of this Article,

Site shall be deemed to include on board ship and other forms of transportation within Oman.

7.7. Construction Equipment

7.7.1. Contractor shall supply at its expense at the Site all Construction Equipment necessary for

the execution of the Work. Such Construction Equipment shall conform to the requirements and specifications of Company as provided in the Contract or, if no such requirements or

specifications exist, be subject to approval by Company. At all times preference shall be

given to the use of locally available equipment where such equipment is competitive with respect to price, safety, quality, delivery time and such like criteria.

7.7.2. Exclusive usage on Site

All Construction Equipment provided by Contractor, when brought onto the Site, shall be,

and shall be deemed to be, intended exclusively for the construction of the Work and Contractor shall not remove them without the consent of Company.

7.7.3. Suitability of Equipment



If, in the opinion of Company any item of Construction Equipment is not, or is no longer,

suitable for the purpose intended, then Contractor shall at no additional cost to Company

and at the option of Company, either make adequate repairs or arrange for immediate replacement. If, in the opinion of Company, Contractor does not adhere to the Programme

due to the Construction Equipment being inadequate, then Contractor shall provide the necessary additional Construction Equipment at no additional cost to Company.

7.8. Use of petroleum products

7.8.1. When undertaking the Work in Oman Contractor shall use lubricants and other petroleum products which have been manufactured by or sold under any of the brand name of

Company Group provided that prices and quality are competitive. In the event of any conflict between this Article and the Article headed “National Products” and “Products of GCC

Origin”” then the latter shall prevail.

7.9. National Products and Products of GCC Origin

7.9.1. Where available, Contractor shall use or cause to be used National Products and, where

these are not sufficient or not available, Products of GCC Origin, provided that both shall meet the pricing, quality and delivery conditions of the Contract.

7.9.2. In relation to price Contractor shall use National Products, where available, provided they are not more than ten percent (10%) higher in price than equivalent foreign products and

shall use Products of GCC Origin, where available, provided they are not more than five

percent (5%) higher in price than equivalent foreign products.

7.9.3. Contractor shall be responsible for ascertaining whether products are National Products,

Products of GCC Origin or foreign products and shall indemnify and hold harmless Company in respect of any fine levied for breach of any law or government regulations relating to such

products.

7.9.4. On the request of Company, Contractor shall provide a list for Company's approval of all

National Products and Products of GCC Origin if any such Materials are to be utilised in the

performance of the Contract.

ARTICLE - 8. INSPECTION AND TESTING

8.1. General

8.1.1. Company shall have the right, but not the obligation, at any time to inspect, test and examine the Materials to be furnished by Contractor or any Subcontractor, any item of

Equipment as well as the Work or any part thereof. No such inspection, testing and examination shall relieve Contractor from its obligations under the Contract.

8.1.2. Company shall only recognise inspections and certifications as required in the Contract that have been performed by a Company approved inspection company.

8.2. Company’s right to reject

8.2.1. Company shall have the right to reject any or all Materials, Construction Equipment or any

part of the Work, which does not conform to the Contract. Contractor shall promptly remove any such rejected Materials, Construction Equipment and Work from the Site and

replace or re-perform same, as the case may be without cost to Company. Failure of

Company to reject any Work, Materials or Construction Equipment shall not prejudice Company from subsequently disapproving them.

8.2.2. Subject to Article ‎8.3.3, any work performed by Contractor in connection with inspection,

testing, examination or rejection as referred to in Article 8.2.1 shall not entitle Contractor to any revision of the Programme or the Completion Date, or of the Contract Price.

8.3. Covering up and uncovering

8.3.1. Contractor shall afford full opportunity for Company to examine any part of the Work which is about to be covered up or put out of view. Contractor shall give due advice to Company

whenever any such part of the Work is ready or about to be ready for examination and



Company shall without unreasonable delay attend for the purpose of examining any part of

the Work. Contractor shall supply all Construction Equipment reasonably required to allow

Company to perform its rights under this Article.

8.3.2. Without prejudice to Article 8.3.1, Contractor shall uncover any part of the Work or make

openings in or through it as Company from time to time directs and shall reinstate and make it good to the standard required by the Contract.

8.3.3. If any part has been covered up or put out of view after compliance with the requirements

of Article 8.3.1 but is subsequently uncovered or opened pursuant to Article 8.3.2 of this Article and is found to be executed in accordance with the Contract, the cost of uncovering,

making openings in or through, reinstating and making it good shall be borne by Company. In any other case such costs shall be borne by Contractor.

8.4. Testing

8.4.1. Contractor shall at its own cost carry out or cause to be carried out all examinations, tests

and measurements which are specified in the Contract or which may reasonably be required

by Company to determine the quality or quantity of any Materials supplied or any part of the Work performed by Contractor.

8.4.2. Contractor shall as and when required supply such samples of Materials as may be selected by Company for testing before the Materials are incorporated in the Work. All samples shall

be supplied by Contractor at its own cost if the Contract provides that it shall so supply

them, otherwise Company shall pay for the samples.

8.4.3. If any test is ordered by Company which either:

a) the Contract does not provide for or may not reasonably be inferred from the Contract to be required; or

b) though provided for is ordered by Company to be carried out by an independent person at any place other than the Site or the place of manufacture or fabrication of the

Materials tested

then the costs of and incidental to the test shall be borne by Contractor if the test shows the workmanship performed or Materials supplied by Contractor not to be in accordance with the

provisions of the Contract. Otherwise the costs shall be borne by Company.

8.5. Search for cause of defects

8.5.1. Contractor shall, if required by Company in writing, search under the directions of Company

for the cause of any defect, imperfection or fault appearing during the progress of the Work or during the period referred to in the Article headed “Warranty for the Work”. If such

defect, imperfection or fault shall be one for which Contractor is liable, the cost of all investigation and searching shall be borne by Contractor and Contractor shall in such case

repair, rectify and make good such defect, imperfection or fault at its own expense.

8.5.2. If such defect, imperfection or fault shall be one for which Company is liable, the cost of searching shall be borne by Company and any repairs necessary to rectify and make good

such defect, imperfection or fault shall also be borne by Company.

ARTICLE - 9. SUBSTANTIAL COMPLETION AND COMPLETION

9.1. Substantial Completion

9.1.1. When Contractor considers that the Work has been substantially completed, Contractor shall

notify Company accordingly in writing.

9.1.2. Company shall proceed forthwith to determine whether the Work concerned has been performed and completed in accordance with the Contract and within twenty one (21)

calendar days of receipt of the above notification Company shall either:

a) notify Contractor that in Company's opinion Substantial Completion has not been

achieved and Company shall indicate the outstanding Work;

b) notify Contractor that Company has found the Work or part thereof not to have been performed in accordance with the Contract and that Contractor is required to

immediately remedy such defect in performance so as to enable Company to issue a Substantial Completion certificate;



c) issue to Contractor a Substantial Completion certificate indicating any remedial Work

and any outstanding Work to be completed under the Contract. Contractor shall

immediately carry out any remedial Work. Company shall indicate the time frame within which Contractor shall complete the outstanding Work.

9.2. Substantial Completion of part of the Work

9.2.1. Company may, or if required in the Contract, issue a Substantial Completion certificate with

respect to any part of the Work (including where Company has terminated the whole or part

of the Work under the Article headed Suspension and Termination) before Substantial Completion of the whole of the Work. A Substantial Completion certificate relating to any

part of the Work shall not be deemed to certify Substantial Completion of any ground or surface requiring reinstatement unless such certificate expressly so states.

9.3. Completion

9.3.1. When Contractor considers that the Work has been completed in accordance with the

Contract, Contractor shall so notify Company in writing.

9.3.2. Company shall proceed forthwith to determine whether the Work has been performed and completed in accordance with the Contract. Within thirty (30) calendar days of receipt of

the above notification from Contractor, Company shall either:-

a) issue to Contractor a Completion certificate, or

b) notify Contractor that Company has found the Work or part thereof not to have been

performed in accordance with the Contract. Company shall detail in writing the specific nature of the deficiency and the provision of the Contract which contains the obligation

of Contractor, which Contractor has failed to meet. Contractor shall immediately take all action necessary to remedy the defect, so as to enable Company to issue to

Contractor a Completion certificate, or

c) notify Contractor that Company has found the Work or part thereof not to have been

performed in accordance with the Contract and that Company requires Contractor not to

remedy the deficiency, in which case Company shall be entitled to the rights and remedies set out in the Article headed “Suspension and Termination”. In respect of the

remaining Work, Company shall also either notify Contractor in accordance with subparagraph (b) of this Article or shall issue a Completion certificate.

ARTICLE - 10. WARRANTY FOR THE WORK

10.1. Warranty

10.1.1. Contractor guarantees that the Work, including the Materials procured by Contractor, shall

conform to and perform in accordance with the requirements of the Contract, be fit for their intended purpose as stipulated in the Contract and be free from defects, other than defects

which are shown to be caused by normal wear and tear or by the improper use, operation or

handling by Company.

10.1.2. Where Company issues a Substantial Completion certificate for part of the Work Contractor

shall guarantee such part of the Work until such time as Substantial Completion for the whole of the Work has been achieved.

10.1.3. In the event that during the Warranty Period (refer Article 1), it appears in Company's

opinion, that the Work or any part thereof does not meet the requirements of the Contract, or is required to be re-performed, rectified or replaced, Company shall so notify Contractor,

stating the particulars of the defect, which Contractor shall promptly rectify at its own expense.

10.1.4. Subject to Company‟s written instruction for the Work to be re-performed, rectified or replaced, should Contractor fail to promptly take the action required to remedy the defect,

Company shall be entitled to take such action or to have such action taken and the costs

thereof and/or relating thereto shall be reimbursed by Contractor within forty five (45) calendar days of receipt of a specified invoice from Company.

10.1.5. In the event that the rectification of the defect involves the re-performance, rectification or replacement of any part of the Work, including but not limited to any item of Materials



procured by Contractor, the Warranty Period for that replaced or modified part of the Work

shall be extended by a period equal to the original Warranty Period, if necessary repetitively.

In any event, and unless otherwise stated in the Contract, such extended Warranty provisions shall not exceed 24-months beyond the achieved Completion Date.

10.1.6. When so requested by Company, Contractor shall, during the Warranty Period, also rectify any defect in Company supplied Materials or provide any additional work or services related

to the Work but not covered by these guarantee provisions, at a price to be determined in

accordance with the Article headed “Instructions and Variations to Contract”.

10.1.7. Upon expiry of the Warranty Period, including any extension thereof, Company shall issue a

Final Completion certificate to Contractor.

10.2. Final Completion

10.2.1. The issue of a Final Completion certificate shall not absolve Contractor from the obligation to remedy, or indemnify Company for the cost of remedying, latent defects which transpire

within ten years from the issue of the Final Completion certificate and which are attributable

to Contractor, a Subcontractor or Contractor Personnel. In this Article, the term “latent defect” shall mean a defect to civil or structural works which produces no readily observable

effects prior to the issue of the Final Completion certificate and which is attributable to an unfit for purpose design, or to poor or faulty engineering or workmanship, or to Materials

which do not conform to the Contractual specifications or are unfit-for-purpose.

10.2.2. If a Subcontractor has undertaken towards Contractor any continuing obligation extending for a period exceeding that of the Warranty Period, then Contractor shall, at the end of the

Warranty Period, notify Company of such continuing obligation and assign to Company the benefit of that obligation, for the remaining duration.

ARTICLE - 11. SUSPENSION AND TERMINATION

11.1. Suspension of the Work

11.1.1. Company may, by a written order, instruct Contractor to suspend the Work or any part of the Work for the period and in the manner which Company considers necessary. Contractor

shall cease work on said part of the Work on the effective date of suspension, but shall continue to perform any unsuspended part of the Work. During the suspension Contractor

shall properly protect and secure the Work so far as is necessary in the opinion of Company.

11.1.2. Company shall pay all reasonable costs incurred by Contractor in giving effect to the suspension order, unless the suspension is:

a) necessary because of Force Majeure; or

b) necessary for the proper execution of the Work, or any part thereof; or

c) necessary because of some negligence, error or other default on the part of Contractor;

or

d) necessary for the health or safety of Company and/or Contractor Personnel, third

parties or for the protection of the Work, Company property or environment; or

e) otherwise provided for in the Contract.

11.1.3. Where suspension of the Work is not attributable to any negligence, error or default of Contractor then: -

a) Where the suspension duration, in Company's reasonable judgement, entitles Contractor

to additional costs and/or an extension of the Completion Date, the parties shall negotiate such extension.

b) Should the suspension continue for a period of greater than six (6) months, or should the aggregate of all suspensions exceed six (6) months, Contractor shall be entitled to

terminate the Contract and in such event be entitled to the payments as detailed in

Articles ‎11.2.8 and ‎11.2.9.

11.1.4. Company may, at any time, authorise resumption of the suspended part of the Work by

notifying Contractor of the part of the Work to be resumed and the effective date of



withdrawal of the suspension. The Work shall be promptly resumed by Contractor after

receipt of such notification.

11.2. Termination of the Contract

11.2.1. The Contract shall terminate on the date of the issuance of the certificate of Final

Completion of the Work by operation of law without any notice being required, unless terminated earlier in accordance with the provisions of this Article or unless otherwise

explicitly provided for in the Contract.

11.2.2. Company shall have the right at any time and at its absolute discretion to terminate the Contract by giving Contractor notice of termination. Such notice shall become effective

immediately after delivery to Contractor or on such later date or after completion of such work in progress as specified by Company in the notice.

11.2.3. Default by Contractor

In the event of the failure, refusal or inability of Contractor to perform any part of the Work

in accordance with the Contract, Company may give notice of default to Contractor stating

the details of such failure. If Contractor within five (5) calendar days after receipt of such notice does not commence, or having commenced does not continuously proceed with

action satisfactory to Company to remedy such failure, Company may issue a notice of termination, without prejudice to any other rights or remedies which Company may have

under the Contract.

11.2.4. Effect of Termination Notice

In the event of a notice of termination being given by Company, Contractor shall

immediately, or upon such other date as is specified in such notice, terminate its performance of the Work and shall assign to Company, or its nominee, all rights and titles

relating to the Work which Contractor may directly or indirectly have acquired vis-à-vis third parties. In addition Contractor shall make arrangements to demobilise all Contractor‟s

Construction Equipment unless specifically requested by Company that all or part of this

equipment should remain at Site for use by Company or its nominee. The cost for the hire of this equipment shall be at the rates included within the Contract, or if no such rates are

applicable reasonable rates shall be agreed, for works undertaken on a daywork basis. In addition Contractor shall take all such further steps as are necessary to enable Company, or

its nominee, to take over Contractor's position in the performance of the Work with the least

possible disruption, all in accordance with Company's instructions.

11.2.5. Return of Contractor‟s Equipment on Completion

If Company takes over the Work as referred to in Article 11.2.4 due to default as referred to in Article 11.2.3 then upon completion of the Work by Company, or its nominee, or at such

earlier date as Company considers appropriate, Company shall inform Contractor, if

applicable, that any Construction Equipment, which is owned or was in use by Contractor and which was taken over by Company pursuant to this Article, is held available for

Contractor at such place as is indicated by Company. Contractor shall thereafter without delay remove or arrange for the removal of such Construction Equipment from such place.

The costs of removal and demobilisation of such Construction Equipment shall be for Contractor's account.

11.2.6. Contractor‟s bankruptcy

In the event of Contractor being adjudged bankrupt, applying for a legal moratorium of payments (surseance) or any similar form of legal action and in the event of any other

factual or legal measures to the effect that Contractor should lose at any time the facility of freely controlling, or of freely disposing of any substantial part of its assets or other facilities,

or if, in the opinion of Company, Contractor is likely to be subject to such type of action then

Company may terminate the Contract, without prejudice to any rights or remedies which Company may have under the Contract.

11.2.7. Improper business conduct



Company shall be entitled to terminate the Contract and to recover from Contractor the

amount of any loss or damage resulting from such a termination if Contractor, any

Subcontractor, Contractor Personnel or representative of Contractor or any Subcontractor, with the intention of obtaining an improper business advantage, either, enters into any

business arrangements, or, pays any commissions or fees, or grants any rebates to, or gives any gifts or entertainment to, any officers, employees or agents of Company, or, commits

any other act with such an intention.

11.2.8. Amounts payable on Termination

If Company terminates the Contract then, provided the termination is not in consequence of

Article ‎11.2.3, (default) Article ‎11.2.6, (bankruptcy etc) or Article ‎11.2.7 (improper business conduct) or Company exercising a specific right to terminate the Contract (other than a

termination without cause pursuant to Article ‎11.2.2) Contractor shall be paid the following:

a) the value of the Work completed in accordance with the Contract up to the effective

date of termination, plus other amounts due or reimbursable under the Contract, if any,

less any part of the Contract Price previously paid by Company to Contractor, if any, and less any amounts due or owing by Contractor to Company;

b) the cost to Contractor of demobilising Construction Equipment, if any, and Contractor Personnel;

c) all cancellation charges incurred by Contractor at law in terminating any Subcontract

and/or Purchase Order under similar terms to this Article;

d) all costs incurred by Contractor in preserving and protecting the Work in progress, and

Materials or Construction Equipment whether in transit or at the Site, and all other direct costs of closing out the Work; and

e) a termination fee of 5%, or such other percentage as may have been stipulated in the Contract, of the difference between the value of Work satisfactorily completed and the

Contract Price, which termination fee shall cover all loss of profit, costs, hardship or

other inconvenience to Contractor not compensated for by payments under sub-Articles (a), (b), (c) or (d) of this Article.

The total payment made to Contractor under this Article shall in no event exceed the Contract Price.

11.2.9. If Company terminates the Contract, other than in accordance with Article ‎11.2.8 then

Contractor shall be entitled to payment for the value of Work completed in accordance with the Contract prior to the date of notification of termination by Company. No further

payments shall be due to Contractor under the Contract.

The following shall be for Contractor's account in the event Company terminates the

Contract for the reasons stated in this Article ‎11.2.9.

a) costs relating to the examination and certification of the actual costs by external auditors appointed by Company.

b) costs incurred by Contractor in undertaking the actions detailed in Article ‎11.2.3;

c) any additional costs or any damage incurred by Company resulting from Contractor's

failure referred to in Article ‎11.2.3, and

d) except as provided in this Article, any costs, loss or damage sustained by Contractor

from discontinuance of part of the Work or from termination of the Contract.

11.2.10. If it is provided in the Contract that Contractor shall pay a certain sum per day as penalties for delay in completing the Work, Company shall, in addition to such penalties, have the

right to terminate the Contract under application of Articles 11.2.9 and 11.2.10 of this Article if Substantial Completion has not been achieved within the maximum number of calendar

days in respect of which penalties shall be payable.

11.2.11. If upon termination of the Contract the part of the Contract Price previously paid to Contractor exceeds the total amount to which Contractor is entitled, as calculated in

accordance with this Article and after deduction of any amounts due to Company, then Contractor shall repay the excess to Company within thirty (30) calendar days of receipt of a

specified invoice, failing which Company may call on the performance bond.



11.3. Survival of terms and conditions

11.3.1. Termination of the Contract shall not relieve the parties of any continuing rights, obligations

and liabilities under the Contract, including but not limited to the Articles headed “Right to audit”, “Warranty for the Work”, “Liabilities and Indemnification”, “Ownership patents and

proprietary rights and “Confidentiality.” These terms shall survive for ten (10) years.

ARTICLE - 12. PAYMENT

12.1. Sufficiency of Contract Price

12.1.1. Contractor shall be deemed to have satisfied itself on and taken due account in the Contract

Price of:

a) all the conditions and circumstances affecting the Contract Price;

b) carrying out the Work as described in the Contract;

c) general circumstances at Site; and

d) general labour requirements and restrictions.

12.1.2. The Contract Price shall cover the completion of the Work and all other obligations of

Contractor and all costs incurred by Contractor for and in connection with the Work and shall be fixed for the duration of the Contract , except where explicitly stated otherwise in the

Contract.

12.2. Payments due

12.2.1. In consideration of Contractor's performance of the Work, Company shall pay Contractor the Contract Price in accordance with the Contract.

12.2.2. Except where it is explicitly provided that Company shall carry out an obligation under the

Contract at its own cost, all things required to be supplied or performed by Contractor under the Contract shall be at Contractor's cost and deemed to be included in the Contract Price.

12.3. Submission of invoice

12.3.1. All invoices and other applications for payment shall be submitted in accordance with the

requirements of Section C8, Procedures for Contractors.

12.3.2. If Company shall dispute any item on any invoice in whole or in part or if the invoice is prepared or submitted incorrectly in any respect, Company shall pay only the undisputed

portion of a disputed invoice. Company and Contractor shall endeavour to settle any matters in dispute at the earliest possible time.

12.3.3. Neither the presentation nor payment of an individual invoice shall be irrevocable or

constitute a settlement of a dispute, or otherwise waive or affect the rights of the parties hereunder.

12.4. Form of Payment

12.4.1. Within thirty (30) calendar days of receipt of the correctly prepared and adequately

supported invoice Company shall pay the amount of such invoice into a nominated bank account of Contractor, provided Contractor has submitted such invoice in accordance with

the provisions of this Article.

12.4.2. All payments made by Company to Contractor shall be made by bank transfer to Contractor‟s nominated bank account. Contractor‟s nominated account shall be in the name of and solely

owned by Contractor.

12.5. Right to set off

12.5.1. Notwithstanding anything herein contained, Company shall always have the right to set off

against any payment which maybe due or become due to Contractor under the Contract any moneys which may be owing or payable by Contractor to Company or recoverable by

Company from Contractor under the Contract.



12.5.2. If Company at any time incurs costs which, under the provisions of the Contract, Company is

entitled to recover from Contractor, Company may invoice for such costs which shall be a

debt due from Contractor to Company.

12.5.3. If a dispute connected with the Contract exists between the parties Company may hold from

any money which becomes payable either the equivalent of Company's estimated value of the portion of the Work which is under dispute or the amount which is the subject of the

dispute.

ARTICLE - 13. DUTIES AND TAXES

13.1.1. All rentals, royalties, fees, charges, taxes, levies, import or export or other duties,

authorisations, approvals, permits, consents and licenses of whatever nature required to be paid in connection with either the Work or the payment of the Contract Price or Contractor

Personnel, shall be borne by Contractor and Contractor shall indemnify and hold harmless

Company accordingly. It shall be Contractor's responsibility to investigate and establish its liability for all taxes, levies, charges etceteras which may be applicable to or be levied in

connection with this Contract.

13.1.2. Where Contractor claims to be exempted from any statutory deductions, it shall inform

Company and provide any necessary documentation to support its case, including a certificate of exemption from the relevant authority. Where Contractor cannot demonstrate

to Company's satisfaction that Contractor is exempt, Company shall not be liable to

Contractor or any other person or body in the event that Company applies the statutory deduction according to the relevant laws or regulations.

ARTICLE - 14. RIGHT TO AUDIT

14.1. Company’s Right to Audit

14.1.1. For the purpose of reviewing and verifying the quantities and cost reimbursable items and

for any other reasonable purpose, Company or its authorised representatives, shall have access at all reasonable times to all personnel, books, records, correspondence, instructions,

plans, drawings, receipts, vouchers and memoranda of both Contractor and any Subcontractor pertaining to the reimbursable Work. Company or its authorised

representatives shall have the right to reproduce and retain copies of any of the aforesaid

documents.

14.1.2. Company or its authorised representatives shall have sufficient access to any Rate

information to satisfy themselves that no Work that is supposed to be included in the Rates of Contractor is invoiced as directly reimbursable costs and that all the Work that is required

to be provided in the Rates are so provided. If any costs are in dispute and Contractor

refuses to provide access, such costs shall be deemed to be included in the Rates of Contractor and shall not be allowable as reimbursable costs.

14.1.3. The above audit rights of Company shall continue for a period of two (2) years after either the Completion Date or after termination of the Contract, if earlier, and Contractor shall

preserve and shall cause its Subcontractors to preserve all documents for the same period.

14.1.4. Technical, safety and environmental audits

Company shall have the right to subject all or part of Contractor's or Subcontractor‟s

Facilities, Materials, Construction Equipment, Contractor Personnel and Subcontractor Personnel employed and operations undertaken in the performance of the Work, to

technical, safety and environmental audits as considered necessary by Company.

14.1.5. Audit of Subcontractors

Contractor shall cause its Subcontractors to give Company the audit rights set out in Articles

14.1.1 and 14.1.2.

14.1.6. Disclosure of Secrets

Nothing in this Article 14 shall require disclosure of Contractor‟s trade secrets or proprietary information without Company signing a secrecy agreement limited to non-disclosure of any

such trade secrets or proprietary information.



ARTICLE - 15. OMANISATION

15.1. Omanisation of Contractor Personnel

15.1.1. Contractor shall comply with, and shall cause its Subcontractor(s) to comply with, all applicable laws and regulations of the Sultanate of Oman governing the engagement and

employment of personnel and, in particular, those related to Omanisation. Nothing contained in this Article shall contradict or relieve Contractor from any statutory obligation in

accordance with the relevant laws of the Sultanate of Oman.

15.1.2. Contractor shall at all times adhere to, and cause its Subcontractors to adhere to, the Omanisation and community contractor requirements stipulated in the Contract (Section C7,

Local Content).

15.1.3. In the event Contractor fails to employ Omani nationals in the positions and in such numbers

as required by the applicable laws and regulations and the Omanisation Schedule, Company

shall have the right to suspend the Work or terminate the Contract and to levy the penalties stipulated in the Omanisation Schedule.

15.1.4. All costs of Omanisation shall be included in the Contract Rates, including but not limited to:- salaries, work/leave schedules, allowances, transportation costs, merit increases,

promotions, final settlements, training, as well as social security contributions etc.

15.1.5. As at the Commencement Date of the Contract, all Drivers, Watchmen and Unskilled staff

provided by Contractor and Subcontractor(s) under the Contract shall be Omani Nationals.

ARTICLE - 16. HEALTH, SAFETY AND ENVIRONMENT

16.1. Compliance with HSE Specification

16.1.1. Contractor shall operate, and shall cause its Subcontractors and Contractor Personnel to operate, with the utmost care for the health and safety of Contractor Personnel, Company

personnel and third parties, and for the environment.

16.1.2. Contractor shall comply, and shall cause its Subcontractors and Contractor Personnel to

comply, with the HSE Specification (Section C9), and with the laws and governmental regulations in respect of health, safety and environment. In case of any inconsistency

between the HSE Specification and the laws and governmental regulations, the most

stringent provision shall prevail.

16.1.3. Contractor shall ensure that any person admitted to the Site by Contractor, any

Subcontractor or Contractor Personnel, shall likewise comply with the HSE Specification applicable to activities on Site. Where Contractor is required to attend HSE training courses

Contractor shall ensure that there is minimum disruption to the Work as a result of

Contractor Personnel attending such courses.

16.1.4. Compliance with the HSE Specification and the laws and governmental regulations shall not

relieve Contractor, its Subcontractors and Contractor Personnel from the obligation to operate in accordance with sound health, safety and environmental practice on aspects

which are not covered or which are insufficiently covered by the HSE Specification or the

laws and governmental regulations. Company shall have the right to amend the HSE Specification; where such amendment has a time or cost effect, the Article headed

“Instructions and Variations to Contract” shall apply.

16.1.5. Company shall have the right to carry out health, safety and environmental inspections and

audits, whether on the Site or on the premises of Contractor or any Subcontractor, and to investigate any incidents and accidents, and Contractor shall afford and cause its

Subcontractors and Contractor Personnel to afford Company all co-operation and access

which Company may require to carry out such inspections, audits and investigations.

16.1.6. Contractor shall for its own account repair any damage to the environment caused by

Contractor, any Subcontractor or Contractor Personnel, subject to the requirements of Article 17.5.



16.1.7. Any failure of Contractor, any Subcontractor or Contractor Personnel to comply with this

Article, the HSE Specification or any instruction given thereunder by Company, or with the

laws and governmental regulations in respect of health, safety or the environment, shall be considered a fundamental breach of Contract.

16.1.8. Without prejudice to the terms of ‎Article - 17 Contractor shall indemnify and hold Company

harmless from and against any and all liability, damages, claims, fines, penalties or other sanctions which may be imposed on Company as a result of non-compliance with this Article

by Contractor, any Subcontractor, Contractor Personnel or any person admitted by them to

the Site.

16.1.9. For the purpose of this Article the term “Subcontractor” shall include, not only

Subcontractors who perform any part of the Work, but also Subcontractors performing any other work or services for Contractor, or for any Subcontractor, if such work or services

require frequent journeys to the Site or a regular presence on the Site.

ARTICLE - 17. LIABILITIES AND INDEMNIFICATION

17.1. Property and Personal Injury

17.1.1. Contractor shall be responsible for and shall save, indemnify, defend and hold harmless Company Group from and against all claims, losses, damages, costs (including legal costs),

expenses and liabilities in respect of: (a) loss of or damage to property of Contractor Group whether owned, hired, leased or

otherwise provided by Contractor Group arising from or relating to the performance of

the Contract; and

(b) personal injury including death or disease to any person employed by Contractor

Group arising from or relating to the performance of the Contract; and

(c) subject to any other express provisions of the Contract, personal injury including

death or disease or loss of or damage to the property of any third party arising out of the Contract howsoever arising and whether or not caused or contributed to by

negligence or breach of duty (statutory or otherwise) on the part of Company Group

up to an amount specified in Article 19.2(b) of the Article headed “Insurance By Contractor” for any one occurrence and unlimited as to the number of occurrences. In

excess of this level, liability shall be determined by reference to applicable laws.

17.1.2. Company shall be responsible for and shall save, indemnify, defend and hold harmless

Contractor Group from and against any claims, losses, damages, costs (including legal

costs), expenses and liabilities in respect of: (a) loss of or damage to property of Company Group excluding the Work, which is located

at any onshore part of the Site arising from or relating to the performance of the Contract; and

(b) personal injury including death or disease to any person employed by Company Group arising from or relating to the performance of the Contract.

17.2. Work

17.2.1. Without limitation to Contractor‟s other obligations under the Contract and at law, Contractor shall be responsible for the Work from the Effective Date until the Completion Date in

respect of the whole or the relevant part of the Work at which date or dates responsibility shall pass to Company. Before such Completion Date, in the event of loss or damage to the

Work, Contractor shall, if instructed by Company, reconstruct, repair or replace the same.

Where the necessity for such Work of reconstruction, repair or replacement was solely caused by Company Group, such Work shall be at the expense of Company.

17.3. Company Responsibility for Pollution

17.3.1. Notwithstanding the provisions of Article 17.1.1(c) and except as provided by Article

17.1.1(a), Article 17.1.1(b) and Article 17.4, Company shall be responsible for and shall

save, indemnify, defend and hold harmless Contractor Group from and against any claim of



whatsoever nature arising from pollution emanating from the reservoir or from the property

of Company Group arising from or related to the performance of the Contract.

17.4. Contractor Responsibility for Pollution

17.4.1. Except as provided by Article 17.1.2(a) and Article 17.1.2(b) Contractor shall be responsible

for and shall save, indemnify, defend and hold harmless Company Group from and against any claim of whatsoever nature arising from pollution occurring on the premises of

Contractor Group or emanating from the property and equipment of Contractor Group

arising from or relating to the performance of the Contract.

17.5. Consequential Loss

17.5.1. For the purposes of this Article the expression "Consequential Loss" shall mean indirect losses and/or loss of production, loss of product, loss of use and loss of revenue, profit or

anticipated profit, arising from or related to the performance of the Contract and whether or not such losses were foreseeable at the time of entering into the Contract.

17.5.2. Notwithstanding any provisions to the contrary elsewhere in the Contract and except to the

extent of any agreed penalties and damages (including any predetermined termination fees) provided for in the Contract, Company shall save, indemnify, defend and hold harmless

Contractor Group from Company Group's own Consequential Loss and Contractor shall save, indemnify, defend and hold harmless Company Group from Contractor Group's own

Consequential Loss.

17.6. Extent of the Indemnities

17.6.1. All exclusions and indemnities given under this Article (save for those under Article

17.1.1(c)) shall apply irrespective of cause and notwithstanding the negligence or breach of duty (whether statutory or otherwise) of the indemnified party or any other entity or party

and shall apply irrespective of any claim in tort, including negligence, under contract or otherwise at law.

17.7. Notification

17.7.1. If either party becomes aware of any incident likely to give rise to a claim under the above indemnities, they shall notify the other and both parties shall co-operate fully in investigating

the incident.

17.8. Mutual Waiver and Indemnity

(a) For the purpose of this Article 17.8, the following definitions additional to those set out

under the Article headed “Definition”:

(i) “Other Contractor” shall mean any other contractor engaged by Company to

perform work at the Site and which has entered into contract(s) with Company; and

(ii) “Other Contractor Group” shall mean the Other Contractor, its subcontractors (of

any tier), its and their Affiliates, its and their respective directors, officers and employees (including agency personnel) but shall not include any member of

Company Group or Contractor Group.

(b) Commencing from the date on which any Other Contractor became bound by an article

effectively containing the same undertaking as this Mutual Waiver and Indemnity, in any contract which any Other Contractor has entered into with Company, and for the

duration that the Other Contractor remains bound by the provisions of such article,

Contractor shall save, indemnify, defend and hold harmless the Other Contractor Group from and against all claims, losses, damages, costs (including legal costs), expenses

and liabilities in respect of:

(i) loss of or damage to property of Contractor Group whether owned, hired, leased

or otherwise provided by Contractor Group arising from or relating to the

performance of the Contract: and



(ii) personal injury death or disease to any person employed by Contractor Group

arising from or related to the performance of the Contract; and

(iii) any consequential loss sustained by Contractor Group. Consequential losses shall mean indirect losses and/or loss of production, loss of product, loss of use and

loss of revenue, profit or anticipated profit, arising from or relating to the performance of the Contract and whether or not such losses were foreseeable at

the time of entering into the Contract.

(c) All exclusions and indemnities given under this Mutual Waiver and Indemnity shall apply irrespective of cause and notwithstanding the negligence or breach of duty (whether

statutory or otherwise) of the indemnified party or any other entity or party and shall apply irrespective of any claim in tort, under contract or otherwise at law.

(d) Contractor‟s insurances shall be endorsed to provide that underwriters waive any rights of recourse, including in particular subrogation rights against the Other Contractors and

their respective Affiliates to the extent of the obligations assumed herein.

ARTICLE - 18. INSURANCE BY COMPANY

18.1. Without limitation of Contractor‟s obligations and responsibilities under the Article headed “Liabilities and Indemnification”, Company shall co-insure, at its own expense, Contractor

Group, in respect of:

(a) Construction All Risks (CAR) Insurance of the Work against legal liabilities, loss of or damage to the Work, Materials and Company‟s property.

(b) Third Party Risks Insurance against legal liabilities to third parties arising from Contractor‟s or Subcontractor‟s operations under the Contract in connection with the

Work. Company‟s Third Party Risks Insurance shall at all times operate in excess of any General Third Party Liability Insurance arranged by Contractor or its Subcontractor to

the limit as stated on the CAR Insurance.

Such insurances shall be endorsed to provide that the underwriters waive any rights of recourse, including in particular subrogation rights against Contractor, and appropriate

Subcontractor, but only to the extent of the terms and conditions provided in the detailed wording of the insurance policy.

18.2. Subject to the Article headed “Liabilities and Indemnification”, deductibles applying under

the CAR insurance policy arranged by Company shall be for the account of Contractor.

18.3. Contractor shall notify Company of any occurrence likely to give rise to a claim under the above insurance as soon as possible and in any event within fifteen (15) calendar days of

such occurrence. In the event of death, serious injury or major property damage Contractor

shall give immediate notice to Company. Such notice shall be marked for the attention of the Contract Holder.

18.4. Contractor agrees that Company may require, at any time, amendments or supplements to be made to any insurance policy referred to in the Contract. Company shall use reasonable

endeavours to advise Contractor within seven (7) calendar days prior to any such amendment or supplement taking place unless it shall not be practicable for any reason to

do so in which case such advice shall be given as soon as reasonably practicable. Any such

amendment or supplement to any insurance policy may constitute a Variation to Contract for the purposes of this Article 18.4 to the extent that it has a material effect on Contractor‟s

ability to carry out the Work.



ARTICLE - 19. INSURANCE BY CONTRACTOR

19.1. Contractor shall, at its own expense, obtain and maintain as a minimum the insurances set

out in this Article and ensure that they are in full force and effect throughout the life of the Contract. All such insurances shall be placed with reputable and substantial insurers (S&P or

equivalent rating of A+ or better), satisfactory to Company and Company shall not unreasonably object to Contractor‟s insurers, and shall for all insurances (including

insurances provided by Subcontractors) other than Employers Liability Insurance/Workmen's

Compensation to the extent of the liabilities assumed by Contractor under the Contract, include Company, its Co-Ventures and its and their respective Affiliates, as co-insured. All

insurances required under this Article shall be endorsed to provide that underwriters waive any rights of recourse, including in particular subrogation rights against Company, its Co-

Ventures and its and their respective Affiliates, Associated Companies, and Other Contractor

Group in relation to the Contract to the extent of the liabilities assumed by Contractor under the Contract. Such insurances shall also provide that Company shall be given not less than

thirty (30) calendar days‟ notice of cancellation of or material change to cover. The provisions of this Article shall in no way limit the liability of Contractor under the Contract.

19.2. The insurances required to be effected under Article 19.1 shall be legally compliant in all countries in which the Work takes place and shall be as follows:

(a) Employers Liability and/or (where the jurisdiction of where the Work is to be performed

or under which the employees employed requires the same) Workmen's Compensation insurance covering personal injury to or death of the employees of Contractor engaged

in the performance of the Work to the minimum value required by law; and

(b) General Third Party Liability insurance for any incident or series of incidents covering

the operations of Contractor in the performance of the Contract, in an amount not less

than Five million U.S. dollars (US$ 5,000,000) per occurrence and unlimited as to the number of occurrences; and

(c) Third Party and Passenger Liability insurance and other motor insurance as required by applicable jurisdiction; and

(d) Storage/ transit/ Cargo Insurances in respect of Materials procured by Contractor up to

the time they are delivered at Site areas as directed by Contract Holder.

19.3. Without limitation of Contractor‟s obligations and responsibilities, if Contractor subcontracts

any part of the Work, the responsibility and insurance provisions of each Subcontract shall be consistent with the Contract and the Subcontractors need not carry any insurance, which

would duplicate any insurance provided by Contractor or Company.

19.4. Contractor and its Subcontractors shall not commence the shipment of Construction

Equipment and/or Materials or commence the Work at the Site until all applicable insurances

that Contractor and the Subcontractors are required to provide are in force and the necessary certificates have been received by Company. Prior to commencing the aforesaid

activities, Contractor shall comply with all Company's and insurers' requirements including, but not limited to, maximum value concentrations, reports and claim handling procedures.

19.5. Approval by Company of any insurer or terms of insurance proposed by Contractor shall not

relieve Contractor of any obligation or liability under or arising from the Contract or at law.

19.6. Contractor shall furnish to Company certificates of insurance within fifteen (15) calendar

days from the Effective Date for those insurances required by Articles 19.2(a) and (b) and when requested or becoming necessary for those insurances required by Articles 19.2(c) and

(d) giving evidence of the type and scope of each insurance and a statement from the insurers that no insurance will be cancelled or materially changed for the duration of the

Contract without thirty (30) calendar days prior written notice from the insurers to Company.

Such certificates or notice shall be marked for the attention of the Contract Holder.

19.7. Should Contractor at any time neglect or refuse to provide any insurance required herein, or

should any insurance be cancelled, Company shall have the right to procure such insurance. In such event, Company shall authorise a Variation to Contract in accordance with the Article



headed ”Instructions and Variations to Contract” and the Contract Price shall be reduced by

an amount equal to Company's costs in procuring such insurance.

19.8. In the event that any of the insurances are renewable during the performance of the Work, Contractor shall supply Company with evidence of renewal of any such insurance at least

fifteen (15) calendar days before the date of expiry.

ARTICLE - 20. REPRESENTATIVES OF THE PARTIES

20.1. The Contract Holder and Contract Manager shall be the persons named as such in Appendix 1 of Section C1, Form of Agreement.

20.2. The Contract Holder shall generally represent Company with respect to the Contract.

20.3. Company shall have the right to appoint and replace the Contract Holder who shall have the authority to represent Company generally in respect of the Contract and to appoint a

Company Representative(s) and/or Company Site Representative(s); The Contract Holder shall notify the Contract Manager in writing of such appointment and this written notification

shall detail the delegated authority with which the Company Representative(s) and Company

Site Representative(s) are empowered. The Contract Holder shall be the only member of the Company‟s personnel empowered to issue Variations to the Contract.

20.4. The Contract Manager shall generally represent Contractor with respect to the Contract and the Contract Manager and Contractor Personnel confirmed as such in writing by the Contract

Manager shall have the authorities that Contractor has under the Contract.

20.5. Persons representing Company shall at all times have access to the Site.

ARTICLE - 21. SUBCONTRACTORS & MANUFACTURERS

21.1. Company’s consent or approval

21.1.1. Approval by Company of a Subcontractor or Manufacturer in no way relieves Contractor from

the requirement to satisfy itself as to the suitability and capacity of that Subcontractor or Manufacturers to satisfactorily execute and complete the Work in accordance with the

Contract.

21.1.2. Contractor shall not be entitled to enter into a Subcontract for the performance of the whole

of the Work but shall, with the previous written consent of Company which shall not be unreasonably withheld, have the right to enter into Subcontracts for the performance of

parts of the Work provided that the total of such parts of the Work do not amount to the

whole or, in Company‟s opinion, a significant part of the Work and provided that the proposed Subcontractors are registered with Company for the appropriate work.

21.1.3. Prior to entering into any Subcontract, Contractor shall submit to Company for approval full details of the proposed Subcontractor, the part of the Work to be undertaken under the

Subcontract, the form of the Subcontract, any other details that Company shall request or

specify and, insofar as Company is required to separately reimburse Contractor the amounts paid to the Subcontractor, the cost of the Subcontract.

21.1.4. With respect to Subcontracts placed by Subcontractors, Contractor shall ensure that such Subcontracts shall only be placed with Company's prior written consent.

21.2. Subcontractor considered as Contractor

21.2.1. Contractor shall ensure that each Subcontractor shall perform its part of the Work in

accordance with the Contract and afford Company the same rights as Contractor has

afforded to Company, regardless whether or not the provisions of the Contract specifically refer to Subcontractors.

21.2.2. Subcontracts shall not relieve Contractor from any obligation under the Contract and Contractor shall be responsible for the acts, defaults and neglects of any Subcontractor, its



personnel, agents and representatives as fully as if they were the acts, defaults or neglects

of Contractor, its employees, agents, representatives, servants or workmen.

21.2.3. No Subcontract shall bind or purport to bind Company. Each Subcontract shall provide for the possibility of its immediate termination in the event of termination of the Contract, and

for suspension in the event of suspension of the Work. Each Subcontract shall provide for the right of assignment of the Subcontract to Company or its nominee in the event that

Company terminates the Contract.

21.3. Assignment of procurement contracts to Contractor

21.3.1. Company may assign any procurement contract to Contractor where such contract was

awarded to a Manufacturer or supplier by Company or on behalf of Company. Contractor shall assume Company's rights and obligations under the assigned procurement contract,

which shall thenceforth be a Subcontract. Contractor shall hold harmless and indemnify Company for any claim made in connection with the Subcontract except if and to the extent

such claim is based on events which occurred prior to the assignment and were not

disclosed to and could not reasonably have been discovered by Contractor prior to assignment.

21.3.2. Where Contractor is notified of an assignment prior to the Effective Date, Company shall pay Contractor amounts as they become due under the Subcontract in accordance with the

terms of the Subcontract applicable at time of assignment, unless agreed otherwise.

21.3.3. Where no advice of an assignment has been given to Contractor prior to the Effective Date and Company assigns a contract to Contractor then Company shall pay to Contractor

amounts as they become due under the Subcontract in accordance with the terms of the Subcontract applicable at the time of assignment, unless agreed otherwise. Company shall

further pay a fee of 10% (ten per cent) of such amounts to cover all profit, overhead and other costs associated with the assignment.

ARTICLE - 22. CONTRACTOR PERSONNEL

22.1. Suitability of Contractor Personnel

22.1.1. Contractor shall have complete charge of all Contractor Personnel and shall engage, and

cause any Subcontractor to engage, such number of Contractor Personnel as required to

perform the Work in accordance with the Contract. Contractor represents that every effort will be made to minimise the turnover of Contractor Personnel.

22.1.2. Contractor warrants that all Contractor Personnel have the experience and capability to safely, efficiently and expeditiously perform the Work. Contractor Personnel shall have such

linguistic skills as may be required for the fulfilment of their duties.

22.1.3. Contractor shall, within seven (7) calendar days of the Effective Date, present to Company a

name list of all Key Personnel to be employed in the performance of the Work. This list shall

show each person's qualifications and previous certification obtained. The supervisory Key Personnel of Contractor and his Subcontractors shall read, write and speak English fluently.

Company reserves the right to reject for proper reasons a person on the original name list and also any subsequent change to the name list.

22.2. Replacement of Contractor Personnel

22.2.1. Contractor shall ensure that Key Personnel shall not be replaced without the prior written approval of Company. In order to ensure that continuity of the Work is maintained, where

possible any replacement shall work alongside the person who is to be replaced for a reasonable hand-over period, at no expense to Company.

22.2.2. Contractor shall at its own expense ensure that all Contractor Personnel and Subcontractor personnel have been trained sufficiently to perform the Work to the standards required by

the Contract. This training must, as a minimum, include safety, survival and job related

training required by applicable law, the Contract and good practice prior to the start of the Work, and/or as specified in the specification. Contractor will provide certificates evidencing

such training if so required by Company. Contractor shall maintain records of all training received prior to and during the Contract. In the case of safety and survival training for



Omani personnel, written training material shall be issued and training shall be conducted by

Contractor in Arabic.

22.2.3. Contractor shall, at its own cost, immediately replace any member of Contractor Personnel whom Company either refuses to allow access to the Site or to perform any part of the Work

or requires to be removed from the Site, provided that Company does not exercise such right unreasonably. Any Contractor Personnel so replaced shall not be placed on any other

Company work without prior written approval of Company. Contractor shall be responsible

for replacing such persons as soon as possible but no later than thirty (30) calendar days after the removal of such persons was requested by Company.

22.2.4. Neither Contractor nor any Subcontractors shall, without Company's prior written consent, engage any labour employed by another contractor working for Company.

22.3. Liability for Contractor Personnel

22.3.1. Unless otherwise expressly stated in the Contract, Contractor shall have full and exclusive

responsibility for the payment of all salaries, wages, commissions, allowances, pension

premiums, end of service benefits, medical treatment and medical termination benefits, redundancy payments and other remuneration to Contractor Personnel and for the

deduction of the applicable taxes or other levies therefrom for remittance to the authorities concerned, and the Contract Price shall be deemed to include all of the foregoing.

22.3.2. Contractor shall arrange, provide and maintain at its own expense the necessary visas and

work permits for Contractor Personnel.

22.3.3. Contractor shall maintain good industrial relations and shall provide Company on request

with information on all matters relating to conditions of employment of Contractor Personnel including but not limited to rates of pay, allowances, amenities and overtime.

22.3.4. Except as otherwise explicitly provided in the Contract, Contractor shall provide suitable accommodation, messing and catering for Contractor Personnel in compliance with the HSE

Specification and with such regulations and requirements as may exist or be made by the

Government and/or local authorities, and shall provide all transport for Contractor Personnel to, from and at the Site.

ARTICLE - 23. LABOUR RELATIONS

23.1. Compliance with Laws and Company Requirements

23.1.1. Without prejudice to the provisions of Article 21.1, Contractor shall comply, and shall cause

its Subcontractors to comply, with the laws and governmental regulations and with Company's specified minimum requirements with respect to working conditions and terms

and conditions of employment as set out in Articles ‎23.2, ‎23.3, ‎23.4 or as may be amended

by Company from time to time. In the case of any inconsistency between Company's specified minimum requirements and the laws and governmental regulations, the most

stringent provisions shall prevail.

23.1.2. Company shall have the right to amend its specified minimum requirements with respect to working conditions and terms and conditions of employment; where such amendment has a

time or cost effect, the Article headed "Instructions and Variations to Contract” shall apply.

23.2. Minimum Salary

All Contractor expatriate employees engaged in providing the Work shall be entitled to a

minimum basic salary of Sixty Omani Rials (60 OMR) per month, for working the minimum number of hours. This minimum salary shall not include for accommodation, messing, any

other allowances or entitlements including leave flights, medical care and agent‟s fees which shall be paid as additional amounts.

23.3. Deductions

Contractor shall not deduct from the salaries of any of its employees any agency fees or other commissions payable with respect to or in connection with the recruitment or

employment of an employee except where the employee leaves Contractor's employment within two months of being hired and the right to deduct such fees or commissions was

agreed in writing by such employee prior to the date of employment.



23.4. Leave and Flights

23.4.1. Notwithstanding any provision to the contrary in the Omani Labour Law, Contractor shall

ensure that each employee shall take his annual leave entitlement each year on the basis of a minimum fifteen (15) calendar days for the first year of continuous services increasing

thereafter to thirty (30) calendar days for each year of continuous service. Contractor shall also provide each employee, on an annual basis, with a return air ticket to the nearest

international airport to the employee's town of origin in his base country. Contractor shall

not charge to or otherwise seek to recover the cost of such air ticket from any employee.

23.5. Remedy for breach

23.5.1. Any failure of Contractor, any Subcontractor or Contractor Personnel to comply with, this ‎Article - 23 shall be considered a fundamental breach of Contract and, without prejudice to

any other rights that Company may have, Company may terminate the Contract, without

compensation to Contractor, immediately upon notice in writing.

ARTICLE - 24. LAWS, PERMITS AND REGULATIONS

24.1. Compliance with laws, permits and regulations

24.1.1. Contractor shall observe and abide by and shall ensure that all Subcontractors and Contractor Personnel observe and abide by all applicable laws, rules and regulations of the

Sultanate of Oman and of any governmental or regulatory body having jurisdiction over the Work, and with the conditions of any authorisations, approvals, permits, licenses, consents

and clearances relating to the Work whether held by Contractor or Company.

24.1.2. Contractor shall be fully responsible for obtaining without delay such authorisations, approvals, permits, consents, import and other licenses that are necessary for the

performance of the Work and shall be responsible for ascertaining whether any such necessary documentation is held by Company.

24.1.3. Contractor shall, in all operations conducted with respect to performance of the Contract, ensure that no violation of, or infringements upon any rights of Third Parties takes place.

24.1.4. Contractor shall indemnify and hold Company harmless from and against any and all liability,

damages, claims, fines, penalties or other sanctions which may be imposed on Company as a result of non-compliance by Contractor, any Subcontractor or any Contractor Personnel

with this Article.

24.2. Change in legislation

24.2.1. If, as a result of change(s) of legislation which take effect in Oman after the Effective Date

of the Contract and could not have been foreseen by the party affected at the time of entering into the Contract, the cost of performing the Contract increases or decreases by an

amount equal to two percent (2%) or more of the Contract Price, then Company and Contractor shall in good faith negotiate and agree an adjustment of the Contract Price. For

the purpose of this Article, legislation means laws and decrees issued by His Majesty the Sultan of Oman and ministerial decisions and regulations issued by the competent

authorities pursuant to such laws and decrees, with the exception of laws, decrees,

ministerial decisions and regulations concerning corporation, income or profit tax.

24.3. Public relations

24.3.1. Contractor shall maintain, and shall cause its Subcontractors to maintain, good relations with any Government body concerned. Contractor shall make all reasonable efforts to maintain

goodwill among the local authorities, including the Walis and the local Sheikhs, and with the

Omani people.

ARTICLE - 25. OWNERSHIP, PATENTS AND PROPRIETARY RIGHTS

25.1. Ownership

25.1.1. Title to, access to and inspection of, copyright in, the right to possession of and free right of

use of all reports drawings, specifications, calculations, computer software (including



computer aided design models), other documents or materials and all other things created

under or arising out of the Contract shall vest in Company immediately upon the date of

commencement of the Work or creation of the article or document or item as applicable. All rights of title to copyright and ownership in any reports, drawings specifications,

calculations, computer software (including computer aided design models), and other documents or materials developed by Contractor outside the Contract shall remain solely

with Contractor.

All rights of title to, copyright in and ownership of any such items which Contractor provides in relation to the Work and which is merely supplemented, enhanced, modified or adapted in

the course of the Work shall remain with Contractor.

"Software" shall for the purpose of this Article 25, mean the database and all the machine

codes, binaries, object codes and/or source codes, whether in a machine or human readable form and all improvements, modifications or updates thereof, flow charts, logic diagrams,

passwords and output tapes.

Contractor shall upon Completion of the Work provide Company with a satisfactory, complete and up to date copy of the software and all other information necessary to ensure

that Company can continue to satisfactorily use the software so provided by Contractor.

Company reserves the right to verify and validate any information contained within the

software within one year from Completion of the Work. Contractor shall remedy any defects

or inadequacies discovered during the said one year, which Company shall notify to Contractor and such defects or inadequacies shall be remedied within fourteen (14) calendar

days of receipt of such notification.

25.1.2. Company shall retain title to Company provided items and information, including but not

limited to, Technical Information. The Work shall be and remain the property of Company.

25.1.3. All Materials shall become the property of Company upon delivery to the Worksite or

payment by Company whichever is the earlier.

25.1.4. Contractor shall ensure that all Materials and Construction Equipment are free from all liens and/or retention of title claims from any third party.

25.1.5. Title in any equipment, materials and supplies provided by Contractor which do not comply with the requirements of the Contract and which are rejected by Company, shall re-vest

immediately in Contractor.

25.1.6. Title in Materials which do comply with the requirements of the Contract and which has not been rejected by Company but for which no payment has been made by Company and

which are no longer required for the purposes of the Contract, shall re-vest in Contractor.

25.1.7. All items of Company property in the possession of Contractor shall be suitably marked or

clearly identified as the property of Company. As far as possible all such items shall be

segregated from other property.

25.2. Liens, attachments etcetera

25.2.1. Contractor agrees that it will not claim any Lien or charge or the like on the Work or any property of Company Group, in the possession of Contractor or, at the Site.



25.2.2. If at any time there shall be evidence of any Lien, attachment, charge or claim to which, if

established, the Work, Equipment, Material or Company Group‟s property might be

subjected to, and which is made against Contractor or made by any Subcontractor against Company, then Company shall notify Contractor promptly in order that Contractor may

either remove or bond the said Lien, attachment, charge or claim, failing which Company shall have the right to retain out of any payment to be made under the Contract, an amount

sufficient to indemnify Company Group completely against such Lien, attachment, charge or

claim. Should there prove to be any Lien, attachment, charge or claim upon the property of Company Group after all payments hereunder have been made, or where payments due to

Contractor are not sufficient to completely discharge such Lien, Contractor agrees to refund to Company all costs incurred by Company in discharging any such Lien, attachment, charge

or claim imposed on the property of Company Group in consequence of the breach of Contractor. Contractor shall immediately notify Company of any possible Lien, attachment,

charge or claim, which may affect the Work or any part thereof.

25.2.3. Without prejudice to the provisions of this Article 25.2, Contractor shall save, indemnify, defend and hold harmless Company Group from and against all Liens, attachments, charges

or claims by Subcontractors, upon the Work, services, Construction Equipment, Materials or the property of Company Group in connection with, or arising out of, the Contract. Except as

provided in Article 25.2.2, Company shall have the right to withhold the amount of any such

Lien, attachment, charge or claim from any payment to Contractor under the Contract until removal of such claim by Subcontractors. If such Liens, attachments, charges or claims fall

within the scope of the insurances of Contractor, it shall remain the responsibility of Contractor to furnish Company with satisfactory written certification, from the insurer of

Contractor, that any such Lien, attachment, charge or claim is covered by the insurance of Contractor before Company shall release any money withheld hereunder.

25.3. Patents and other intellectual property rights

25.3.1. Neither Company nor Contractor shall have the right of use other than for the purpose of the Contract, whether directly or indirectly, of any patent, copyright, proprietary right or

confidential know-how, trademark or process provided by the other party and the intellectual property rights in such shall remain with the party providing such patent, copyright,

proprietary right or confidential know how, trademark or process.

25.3.2. Where any potential patent or registerable right in any country in the world or any confidential know-how results from:

(a) developments by Contractor or its Affiliates or Subcontractors which are based wholly on data, equipment, processes, substances and the like in the possession of

Contractor or its Affiliates or Subcontractors at the Contract Effective Date or

otherwise produced outside of the Contract; or

(b) enhancements of or in the existing intellectual property rights of Contractor or its

Affiliates or Subcontractors;

such rights shall vest in Contractor or its Affiliates or Subcontractors as the case may be.

25.3.3. Where any potential patent or registerable right in any country in the world or any

confidential know-how results from:

e) developments by Company or its Affiliates or Associated Companies which are based wholly on data, equipment, processes, substances and the like in the possession of

Company or its Affiliates or Associated Companies at the Effective Date or otherwise produced outside of the Contract; or

f) enhancements of or in the existing intellectual property rights of Company or its

Affiliates or Associated Companies;

such rights shall vest in Company or its Affiliates or Associated Companies as the case may

be.

25.3.4. Except as provided in Articles 25.3.1, 25.3.2 and 25.3.3, Company and Contractor shall each

have an equal, undivided interest in the right, title and interest in and to any invention that is jointly conceived or generated during the performance of the Contract.



25.3.5. In the event that either Company or Contractor believes that a patent application should be

filed on a joint invention in accordance with Article 25.3.4, then both parties agree to

cooperate fully in the preparation of such patent application and to pay its respective share of all necessary fees to maintain any jointly owned application or patent assigned to it in

force throughout its full term, provided however, that either party may elect to notify the other party that it intends to discontinue payment of such fees and thereafter promptly

assign such patent to the other party, thereby retaining no interest therein in exchange for

the party and its Affiliates and its Associated Companies being given a royalty-free, irrevocable, non-exclusive, non-transferable, world-wide licence to use such right and to

sublicense the use, by mutual agreement, to a third party.

25.3.6. In the event that either Company or Contractor do not wish to share equally in payment of

the costs for preparing, filing and prosecuting such jointly owned application in accordance with Article 25.3.5, notice shall be provided within thirty (30) calendar days to the other

party and the party proceeding with the patent application at its own cost shall become the

assignee of such patent application and subsequent patent or patents issuing therefrom, however, such assignee shall give the other party and its Affiliates and its Associated

Companies a royalty-free, irrevocable, non-exclusive, non-transferable, world-wide licence to use such right and to sublicense the use by mutual agreement, to a Third Party.

25.3.7. Contractor shall save, indemnify, defend and hold harmless Company Group from all claims,

losses, damages, costs (including legal costs), expenses, and liabilities of every kind and nature for, or arising out of, any alleged infringement of any patent or proprietary or

protected right, arising out of or in connection with the performance of the obligations of Contractor under the Contract except where such infringement necessarily arises from the

Technical Information and/or Company‟s instructions. Contractor shall use its reasonable endeavours to identify any infringement in the Technical Information and/or Company‟s

instructions of any patent or proprietary or protected right, and should Contractor become

aware of any such infringement or possible infringement, then Contractor shall inform Company immediately. Contractor will have no liability for any failure to identify any

infringement in the Technical Information and/or Company‟s instructions.

25.3.8. Company shall save, indemnify, defend and hold harmless Contractor Group from all claims,

losses, damages, costs (including legal costs), expenses and liabilities of every kind and

nature for, or arising out of, any alleged infringement of any patent or proprietary or protected right arising out of or in connection with the performance of the obligations of

Company under the Contract or the use by Contractor of Technical Information or any infringement arising from Company‟s instructions.

25.3.9. Subject to Article 25.3.8, where Equipment, designs, processes, methods, information, work

or products specified and used or proposed to be used by Contractor are held to constitute infringement and its use enjoined, Contractor shall at its own expense either procure the

right to use the same or replace them with non-infringing Equipment, designs, processes, methods, information, work or products

25.4. Items of geological or archaeological interest

25.4.1. All fossils, coins, articles of value or antiquity and structures and other remains or items of

geological or archaeological interest discovered on the Site shall as between Company and

Contractor be deemed to be the absolute property of Company and Contractor shall take reasonable precautions to prevent his personnel or any other persons from removing or

damaging any such article or item and shall immediately upon discovery thereof and before removal acquaint Company of such discovery and carry out at the expense of Company,

Company's orders as to the disposal of the same.

ARTICLE - 26. CONFIDENTIALITY

26.1. Confidential Information and Confidential Records

26.1.1. Contractor undertakes that both during the term of the Contract and after its termination Contractor shall:

(a) preserve and cause all Subcontractors and Contractor Personnel to preserve the secrecy

of any Confidential Information and Confidential Record;



(b) not disclose to any third party any Confidential Information or Record except with

Company's prior written consent;

(c) not use any Confidential Information or Record other than for the purpose for which it has been disclosed to Contractor.

26.1.2. Such undertaking shall continue insofar and for so long as the Confidential Information or Confidential Record in question has not:

(a) become part of the public knowledge or literature otherwise than through any act or

default on the part of Contractor; or

(b) been disclosed to Contractor under an obligation to maintain secrecy by a third party

(other than one disclosing on behalf of Company) who could lawfully do so and who did not derive such Confidential Information or Confidential Record from Company.

26.1.3. Contractor shall ensure that if under the terms of this Article any Confidential Information or Confidential Record comes to the knowledge or in the possession of any third party such

third party shall also be bound by the stipulations contained in this Article.

26.1.4. Contractor shall return to Company after expiration or termination of the Contract, all originals and copies of documents, drawings, data and any other information placed with or

at the disposal of Contractor by or on behalf of Company relating to the performance of the Contract.

26.1.5. Contractor shall ensure that the provisions of this Article are incorporated in any

Subcontract.

26.2. Press releases

26.2.1. No announcements, press releases, handouts or photographs for publication etc. relating to this Contract or any part of the Work shall be issued or released without Company‟s prior

written approval.

ARTICLE - 27. BUSINESS ETHICS AND PRINCIPLES

27.1.1. Company works under strict general business principles that govern how it conducts its

affairs. These business principles are contained in a „Statement of General Business Principles‟ which can be accessed at http://www.pdo.co.om/pdoweb/tabid/83/Default.aspx

27.1.2. Company insists on honesty, integrity and fairness in all aspects of its business and expects

the same in its relationships with those with whom it does business. The direct or indirect offer, payment, soliciting, giving and acceptance of bribes in any form, are unacceptable

practices.

27.1.3. Company expects Contractor Group to practice such business principles that are consistent

with Company‟s business principles.

27.1.4. Without prejudice to any other rights that Company may have, Company may terminate the

Contract immediately upon notice in writing should Contractor violate the provisions of this

Article.

http://www.pdo.co.om/pdoweb/tabid/83/Default.aspx



ARTICLE - 28. CLAIMS

28.1. Contractors Claims for additional expense

28.1.1. If Contractor intends to claim any additional payment under these General Conditions or otherwise, Contractor shall give notice to Company as soon as possible and in any event

within fourteen (14) calendar days from the date of the event or circumstances giving rise to the claim.

28.1.2. Contractor shall keep such contemporary records as may be necessary to fully assess and

evaluate the claim.

28.1.3. Within twenty-eight (28) calendar days of such notice being given, or such other time as

may be agreed with Company, Contractor shall forward to Company an account, giving detailed particulars of the amount and basis of the claim. Contractor shall send such further

particulars as are requested by Company within the time specified by Company. Where

interim accounts are sent to Company Contractor shall send a final account within twenty-eight (28) calendar days of the end of the effects resulting from the event.

28.1.4. If Contractor fails to comply with this Article Contractor shall not be entitled to any additional payment.

ARTICLE - 29. ASSIGNMENT

29.1. Company may assign any or all of its rights or obligations under the Contract, subject to prior notification thereof in writing to Contractor.

29.2. Contractor shall not assign its rights or obligations under the Contract, in whole or in part, without the prior written consent of Company.

ARTICLE - 30. APPLICABLE LAW AND DISPUTE RESOLUTION

30.1.1. This Contract shall be construed and take effect in accordance with the laws of the Sultanate

of Oman.

30.1.2. Any dispute between Company and Contractor in connection with, or arising out of, the

Contract or the Work shall be resolved by means of the following procedure:

(a) the dispute shall initially be referred to the Contract Holder and Contract Manager who shall discuss the matter in dispute and make all reasonable efforts to reach an

agreement. The basis of such dispute shall be submitted in accordance with Articles 30.1.7 and 30.1.8;

(b) if no agreement is reached under Article 30.1.2.(a) the dispute shall be referred to two

nominated persons, one from each party, and such nominated person shall have seniority over the Contract Holder and Contract Manager. Such nominated persons may

be replaced by notice to the other party;

(c) if no agreement is reached under Article 30.1.2.(b) the dispute shall be referred to the

Managing Directors or equivalent level of executive management of Company and Contractor.

30.1.3. In the absence of any agreement being reached on a particular dispute in accordance with

Article 30.1.2 then such dispute shall be finally settled in accordance with the UNCITRAL Arbitration Rules in force at the Effective Date, by three arbitrators or, if the parties to the

dispute agree otherwise, by a sole arbitrator.

30.1.4. Each Party shall nominate an arbitrator and these two arbitrators shall designate a third

arbitrator. In the event that either party fails to nominate an arbitrator, as required above,

within two months of that date, then the other party may apply to the Chairman of the Competent Court of Appeal as per Royal Decree 47/97 as amended who has the authority to

nominate an arbitrator to represent the defaulting party. Where the two arbitrators cannot agree on a third arbitrator, either party shall ask the Chairman of the Competent Court of

Appeal as per Royal Decree 47/97 as amended to nominate the third arbitrator.



30.1.5. The arbitration proceedings shall be conducted in the English language and such

proceedings shall be held in Muscat, Sultanate of Oman. Awards shall be reduced to writing,

and shall be final and binding on the parties from the date they were made without the right of appeal, unless the award is in conflict with public order or due process or given

fraudulently. The parties undertake to carry out the award without delay. Judgment upon the award may be entered in any court having jurisdiction.

30.1.6. Whilst any matter(s) is in dispute, both Contractor and Company shall continue to comply

with all the provisions of the Contract, particularly, Contractor shall proceed with the execution and completion of the Work or part of the Work, which is not in dispute except to

the extent that such continuance would prejudice the legal position and /or rights of either party.

30.1.7. Prior to submitting any dispute in accordance with Article 30.1.2, the party raising a dispute shall send a letter of dispute which shall contain the following information:

a) a clear summary of the facts on which each matter in dispute is based;

b) the basis on which each matter in dispute is made, identifying the principal contractual terms and statutory provisions relied on;

c) the nature of the relief claimed; if damages are claimed, a breakdown showing how the damages have been quantified; if a sum is claimed pursuant to the Contract, how it has

been calculated; if an extension of time is claimed, the period claimed; and

d) any other matter of relevance relating to the dispute.

30.1.8. A party receiving a letter of dispute in accordance with Article 30.1.7 shall send, within

fourteen (14) calendar days, a letter of response either accepting or rejecting the reasons set out in the letter of dispute including the party‟s basis for rejection.

30.1.9. Nothing in this Contract shall constitute an agreement by Contractor Group to engage in any act or omission which would be a violation of or result in a penalty under the laws or

regulations of the country to which Contractor Group is subject.



ARTICLE - 31. NOTICES

31.1.1. All notices under the Contract shall be in writing.

31.1.2. Notice to either party shall be given at the address stated in the Form of Agreement and any change of such address shall be notified to the other party in writing.

31.1.3. Notices shall be effective:

a) if delivered by hand, at the time of delivery;

b) if sent by fax, at the time of receipt of the fax;

c) if sent by registered mail, postage prepaid, ten (10) calendar days after the date of mailing of the registered letter.

31.1.4. If either party intending to serve a notice on the other party forewarns that party by any means, the forewarning shall in no circumstances be deemed to be a notice nor shall the

giving of such forewarning have any effect on the time of receipt of the notice.

31.1.5. Unless specifically authorised by the Company Contract Holder, e-mail correspondence shall only be used for the day to day administration of the Contract.

ARTICLE - 32. SUSTAINABLE DEVELOPMENT

32.1.1. Company has a commitment to contribute to Sustainable Development. Company has

accepted and is committed to the Brundtland Commission statement that “meeting the

needs of the present without compromising the ability of future generations to meet their own needs”.

32.1.2. Company expects and requires Contractor to contribute to sustainable development in the way it executes the Work.

ARTICLE - 33. EXCLUSIONS OR LIMITATIONS OF LIABILITY

33.1.1. From the Effective Date of the Contract and before the Completion Date, Contractor's total cumulative liability to Company arising out of or related to the performance of Contract shall

be limited to the estimated Contract Price at the Effective Date of the Contract. The above limitation shall not apply any liabilities assumed by Contractor under the Articles headed

Inspection and Testing, Duties and Taxes, Suspension and Termination, Ownership, Patents

and Proprietary Rights, Insurance By Contractor, Confidentiality, sub-articles headed “Consequential Loss” (Article 17.5) and “Mutual Waiver and Indemnity” (Article 17.8).

33.1.2. After the Completion Date, Contractor‟s total cumulative liability to Company arising out of or related to the performance of Contract shall be limited to Twenty Five Percent (25%) of the

estimated Contract Price at the Effective Date of Commencement of Contract. The above

limitation shall not apply to any liabilities assumed by Contractor under the Articles headed Duties and Taxes, Ownership, Patents and Proprietary Rights, Insurance By Contractor,

Confidentiality, sub-articles headed “Consequential Loss” (Article 17.5) and “Mutual Waiver and Indemnity” (Article 17.8).

33.1.3. Costs arising from any cause of action of Company notified to Contractor before the Completion Date shall be subject to the limitation described in Article 33.1.1 but not to the

limitation described in Article 33.1.2.

33.1.4. Notwithstanding anything in the Contract to the contrary:

(a) misconduct or illegal or unlawful acts shall not be subject to any limitation or exclusion

of liability, and

(b) no liabilities of Contractor or Company covered by insurance are included in

Contractor‟s total cumulative liability for the purpose of determining the limit of

Contractor‟s liability under the Contract.

33.1.5. Any limitation or exclusion of liability under the Contract shall exclude or limit such liability

not only in contract but also in tort, including negligence, or otherwise at law.

33.1.6. Any and all limitations of Contractor‟s liability included in the Contract shall represent the

aggregate cumulative limitation of the liability of Contractor to Company Group.