Νόμοι — ΦΕΚ A' 47/2018

the French Institute of Petroleum (IFP Energies Nouvelles), provided that if, because of a conflict of interests, a Sole Expert cannot be appointed from either of the aforementioned institutes, the Lessor shall be entitled to appoint a Sole Expert from an independent, reputable petroleum institute of another member state of the European Union in which Hydrocarbons are produced. "State" or “Greece” means the Hellenic Republic. “State Data” means any and all geological, geophysical, drilling, well production data, well location maps and other information held or developed by the Lessor in any form in relation to the Contract Area as well as any data acquired and/or produced under the non exclusive marine seismic data acquisition and services commenced on the 26th of October 2012 in any form in relation to the Contract Area. "Third Phase" means the third phase of the Basic Exploration Stage described in Article 2.1(a). INTERPRETATION In this Agreement, subject to any express contrary indication: (a) any reference to an Article shall be construed as a reference to an article of this Agreement and any reference to an Annex shall be to an annex to this Agreement; (b) any reference to a person shall be construed as including: (i) any person, firm, company, Governmental Authority, corporation, society, trust, foundation, government, state or agency of a state or any association or partnership (in each case whether or not having separate legal personality) of two or more of these; (ii) a reference to the successors, permitted transferees and permitted assignees of any of the persons referred to in sub-paragraph (i) above; (c) any reference to this Agreement or any other agreement or document shall be construed as a reference to this Agreement, that agreement or document as it may have been, or may from time to time be, amended, varied, novated, replaced or supplemented; (d) any reference to a law shall be construed as a reference to it as it may have been, or may from time to time be (with or without modification) amended or re-enacted and the Definitions section or elsewhere in this Agreement. 1.1 This Agreement is a lease agreement pursuant to which, in accordance with paragraph 10 of article 2 of the Hydrocarbons Law, the State as the Lessor grants to the Lessee in accordance with the terms and conditions hereof, exclusive rights to carry out Petroleum Operations in the Contract Area. 1.2 The Lessee undertakes in accordance with the terms and conditions set out herein to at all times conduct Petroleum Operations in the Contract Area in accordance with the 1.3 The costs and risks of carrying on Petroleum Operations shall be borne exclusively by the Lessee and the Lessee will have no right to recover such costs, or any part thereof, from the Lessor except as hereinafter provided in this Agreement. 1.4 Each Co-Lessee shall: (a)be jointly and severally liable in respect of the Lessee’s and the other Co-Lessees’ obligations arising under this Agreement against the Lessor and (b)hold an undivided interest, as per Article 1.5, in all of the rights and obligations under this Agreement. For the purposes of this Agreement, any reference to the term “Joint Venture” in the Hydrocarbons Law or in this Agreement means the contractual co-operation between the Co-Lessees under a joint operating agreement, without creating or implying or having the intention to create any, de jure or de facto partnership or entity with or without a separate legal personality. 1.5 The undivided interest of each Co-Lessee (expressed as a percentage of the total interests of all Co-Lessees) in the rights and obligations in this Agreement is as of the Effective Date as follows: Total 50% Edison 25% Hellenic 25% 1.6 The Lessor and the Lessee hereby expressly and unconditionally agree and accept that: (a) any contract to which the Lessor is not a contracting party, which contains terms or provisions defining the relations between the Lessee and/or the CoLessees and/or third parties shall not create any claim against the Lessor or amend this Agreement or regulate this Agreement in a different way; third parties shall not create any claim against the Lessee and/or a Co-Lessee or amend this Agreement or regulate this Agreement in a different way; (c) the terms and provisions of the afore-mentioned contracts cannot be used as a means of interpreting this Agreement nor may they be considered to prevail in any way either in part or in whole, over this Agreement; (d) both the Lessor and the Lessee hereby simultaneously waive every right to contest, cancel and/or challenge the validity and enforceability of this clause. The “Exploration Stage” shall commence on the Effective Date and, unless this Agreement is terminated earlier in accordance with its terms, shall subsist for the periods described in this Article 2. 2.1 For a Basic Exploration Stage (a) Subject as hereinafter provided, the basic exploration stage (the "Basic Exploration Stage") shall subsist for eight (8) years. For the purposes of this Agreement, the Exploration Stage is divided into consecutive exploration Phases defined for the Contract Area as follows: First Phase: 3 years Second Phase: 3 years Third Phase: 2 years (b) Where the Lessee has, during the First Phase, fulfilled its Minimum Work Programme and Minimum Expenditure Obligation relating to that Phase in accordance with Article 3 it may, by giving notice to the Lessor, continue its Exploration Operations during the Second Phase and shall thereupon assume and during the Second Phase discharge its Minimum Work Programme and Minimum Expenditure Obligation relating to that phase set out in Article 3; (c) Where the Lessee has, during the Second Phase, fulfilled its Minimum Work Programme and Minimum Expenditure Obligation relating to that Phase in accordance with Article 3 it may, by giving notice to the Lessor, continue its Exploration Operations during the Third Phase and shall thereupon assume and during the Third Phase discharge its Minimum Work Programme and Minimum Expenditure Obligation relating to that phase set out in Article 3; (d) In the event that before the end of the First Phase or, as the case may be before the end of the Second Phase the Lessee has not given to the Lessor notice pursuant to Article 2.1(b) or, as the case may be, Article 2.1(c), the rights and obligations of the Lessee in respect of the Contract Area shall cease and, subject always to the obligations of the Lessee in respect of liabilities which have accrued under this Agreement, shall be deemed to have been terminated. (e) Upon the Lessee’s duly justified and reasonable request, in order to provide the with Article 2.1(b) and (c) above, a current Phase may be extended by a period up to six (6) Months, provided that the well is the subject of the Minimum Work Obligation and has been spudded prior to the end of the said Phase. If required, and upon the Lessee’s duly justified and reasonable request, the Phase may be further extended for a reasonable time period. (f) In the event that a current Phase (other than a Third Phase) is extended pursuant to Article 2.1. (e) the amount of time by which the current Phase is extended shall be deducted from the period of time defined for the subsequent Phase. 2.2 For an Exploration Stage Extension (a) The Lessee may, in accordance with the provisions of paragraph 3 of article 5 of the Hydrocarbons Law apply for an exploration stage extension (an "Exploration Stage Extension"). (b) It is understood and agreed between the Parties that a requirement for additional time to complete an Appraisal Programme, or where additional reserves must be located before a commercial deposit can be established, to undertake further exploration drilling, or to establish a market for Natural Gas, is a requirement falling within the scope of subparagraph (b) of paragraph 3 of article 5 of the Hydrocarbons (c) If an Exploration Stage Extension is granted pursuant to paragraph 3 of article 5 of the Hydrocarbons Law, the Lessee shall provide to the Lessor a Bank Guarantee on the first day of the Exploration Stage Extension for the full amount, if any, of the shortfall being the difference between the Minimum Expenditure Obligation at the end of the Basic Exploration Stage and the Lessee’s Actual Expenditure during that stage, as defined in Article 3.9. Such Bank Guarantee will replace any existing current Bank Guarantee already provided under this Agreement. In the event that there is no such shortfall, the Lessor shall return any Bank Guarantee provided pursuant to the above promptly upon the commencement of the Exploration Stage Extension. 2.3 For a Special Exploration Stage Extension (a) Pursuant to paragraph 4 of article 5 of the Hydrocarbons Law a Special Exploration Stage Extension not exceeding eight (8) years for offshore, may be granted to the Lessee following its submission of a relevant application by resolution of the Council of Ministers on the recommendation of the Minister. Additional terms and conditions may be imposed in the resolution of the Council of Ministers, notwithstanding the provisions of this Agreement, and this Agreement shall be amended accordingly. (b) In a case where the Lessee has made: exploitation of Associated Natural Gas; or (ii) a Discovery of Hydrocarbons Reservoir in deep waters, the Lessor will support an application by the Lessee under article 5 paragraph 4 of the Hydrocarbons Law for a Special Exploration Stage Extension, timely sufficient to enable the Lessee, before making a declaration of commerciality, to consider the construction and financing of the necessary infrastructure for the disposal of Natural Gas or as the case may be, to consider the physical and financial problems associated with the development of a deposit located in deep waters. 3.1. In discharge of its obligation to carry out Petroleum Operations in the Contract Area, the Lessee shall commence Exploration Operations within six (6) Months of the Effective Date and shall carry out the work and spend, subject to Article 3.3, not less than the sums specified in Article 3.2. 3.2. For the purpose of this Article, the Minimum Work Programme to be performed, and the corresponding Minimum Expenditure Obligations of the Lessee for each Phase of the Basic Exploration Stage, as described in Article 2, shall be as follows Minimum Work Programme Phase 1 Phase 2 Phase 3 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Firm 2D seismic survey Acquisition of 1800 km 2D seismic data + processing Re-evaluation of seismic data Re-evaluation of seismic data 3D seismic survey Other Geophysical Survey Magnetic & Gravity survey if possible during the 2D seismic Acquisition Drilling 1 (one) well 1 (one) well G & G Geological studies, basin analysis Petrophysical and Geochemical analysis, etc. Re-evaluation of G&G data HSE Baseline Report I, Environmental Action Plan etc Baseline Report II, Environmental Impact Assessment etc. Baseline Report III, Environmental Impact Assessment etc. Minimum Expenditure 4,200,000 (four million and two hundred thousand euros) 25,000,000 (twenty five million euros) 30,000,000 (thirty million euros) Contingent Seismic survey Acquisition of 3D seismic program. The size depends on the interpretation of the 2D seismic and of the results of

Annual Work Programme and Budget: save where a proposed Annual Work Programme and Budget is deemed to have been approved by the Lessor pursuant to Article 5.1 and subject to Article 5.2, to review the Annual Work Programme and Budget submitted by the Lessee and consider proposals for the revision of specific features thereof submitted by the Lessor;

Appraisal Programme: to review any Appraisal Programme submitted by the Lessee to the Lessor and to observe the implementation of the work conducted thereunder and inform the Lessor about the progress of the said works;

Development and Production Programme: to review any Development and Production Programme submitted by the Lessee to the Lessor in connection with a Discovery of commercially exploitable Hydrocarbons; All meetings of the Technical Advisory Committee shall be held at such places, whether within or, with the prior approval in writing of the Lessor, outside Greece, and at such times, as may be determined unanimously by its members, but not less than one meeting during each semester, in order to inform the Lessor about the progress of the implementation of the Annual Work Programme and Budget. 4.5 In addition to the scheduled meetings of the Technical Advisory Committee, either the Lessor or the Lessee shall have the right to convene a meeting of the Technical Advisory Committee within Greece in the event of an emergency or extraordinary situation by giving not less than three (3) calendar days written notice to each of the members of the Technical Advisory Committee. 4.7 The Lessor and the Lessee shall each have the right to call any expert to any meeting of the Technical Advisory Committee to advise the committee on any matter of a technical nature requiring expert advice. 4.8 All decisions of the Technical Advisory Committee shall be by unanimous vote of the members present at a meeting thereof and together forming a quorum. 4.9 If the Technical Advisory Committee is unable to reach unanimity on any matter being considered by the committee under this Article 4, the matter shall be referred to the Lessee and the Lessor within fifteen (15) calendar days from the date of the meeting where the matter was considered. If the Parties fail to reach unanimity within thirty (30) calendar days of such referral, the matter shall be referred to a Sole Expert for determination in accordance with Article 23. Provided however that in the case of an Annual Work Programme and Budget submitted by the Lessee prior to a Discovery by the Lessee, the proposals of the Lessee, set out in the Annual Work Programme and Budget, shall be deemed to have been accepted by the Technical Advisory Committee so long as those proposals have been devised in conformity with Article 5 and are consistent with and are intended to enable the Lessee to perform its Minimum Work Program and Minimum Expenditure Obligations under Article 3. 5.1 Three (3) Months before the end of each Calendar Year, or at such time as may be mutually agreed by the Parties, the Lessee shall prepare and submit to the Lessor for approval a programme setting forth all works and operations (including studies, exploration, procurement, equipment, installations, etc) to be carried out pursuant to this Agreement during the following twelve (12) Months period with the budgeted cost for each item of the programme (the "Annual Work Programme and Budget"). In the event that the Effective Date is different from the date of commencement of a Calendar Year the Lessee shall submit a work programme and budget for the remaining of the current Calendar Year within sixty (60) Business Days of the Effective Date. At any time, the Lessee may submit for approval by the Lessor, a revision of an Annual Work Programme and Budget for the remaining of the given Calendar Year. 5.2 Within one (1) Month of its submission, the Lessor may ask for clarifications in relation to the Annual Work Programme and Budget and put forward proposals for consideration by the Technical Advisory Committee for the revision of specific features thereof relating to the nature and cost of the works and operations. If the Lessor does not put forward any such proposals within the prescribed time period, the Annual Work Programme and Budget shall be deemed to have been approved by the Lessor. 5.3 Each Annual Work Programme and Budget and any revision or amendment thereof shall be consistent with the requirements of the Minimum Work Programme and Minimum Expenditure Obligation for the relevant Phase. 5.4 If the Lessee and Lessor fail to reach agreement on proposed revisions to the Annual Work Programme and Budget within ten (10) Business Days of the meeting scheduled to consider the matter(s) in issue, then such matter(s) shall be referred to a Sole Expert for determination. 5.5 Subject to the rights and obligations of the Lessee and in accordance with Article 4.5, the Lessor shall have the right to follow up the performance of the Annual Work Programme and Budget. 5.6 In the event that extraordinary circumstances arise that are not provided for in the Annual Work Programme and require immediate action, the Lessee may take all proper steps for the achievement of the objectives of the Agreement. Any resulting costs shall be included in the expenses referred to in Section 3.1 of Annex C. The Lessor shall be forthwith notified of all modifications referred to above. 5.7 In accordance with Article 4.10, in the case of an Annual Work Programme and Budget submitted by the Lessee prior to a Discovery by the Lessee, the proposals of the Lessee set out in the Annual Work Programme and Budget shall be deemed to have been accepted by the Technical Advisory Committee so long as those proposals have been devised in Article 3. 6.1 Surrender (a) Subject to the provisions of this Article, prior to the end of the Exploration Stage, the Lessee may, by written notice which becomes effective thirty (30) Business Days after it has been served on the Lessor, surrender its exploration rights over the entire Contract Area or a part thereof consisting of one or more contiguous Elementary Blocks. (b) In the event that the Lessee desires to surrender its rights to conduct Petroleum Operations in the Contract Area without having fulfilled all of its Minimum Work Programme and Minimum Expenditure Obligations under Article 3.2 (or such work and expenditure obligations as may be agreed between the Lessee and the Lessor for any Exploration Stage Extension or Special Exploration Stage Extension) ("Additional Expenditure Obligations"), the Lessee shall pay to the Lessor, prior to or on the effective date of any surrender, a sum equal to the difference between (i) the Actual Expenditure attributable to the Minimum Work Programme in that Phase or extension period and (ii) the Minimum Expenditure Obligation during such Phase or the minimum expenditure agreed by the Parties with regard to such extension period. The Lessor shall, in procuring satisfaction of such payment, be entitled to invoke any amount outstanding under the relevant Bank Guarantee. (c) The Lessee may surrender its rights, free of all obligations, at the end of any Phase if it has fulfilled all of its contractual obligations under this Agreement (including Minimum Work Programme and Minimum Expenditure Obligations) up to the end of that Phase. (d) Without prejudice to its other liabilities and obligations under this Agreement, the Lessee's surrender shall not give rise to any claim by it against the Lessor in costs or damages. 6.2 Relinquishment (a) Where the Lessee has, prior to the end of the First Phase, given to the Lessor notice under Article 2.1(b) the Lessee, shall before the commencement of the Second Phase relinquish a portion or portions of the Contract Area (providing they comprise a number of contiguous Elementary Blocks) so that the Contract Area retained is not more than eighty per cent (80%) of the Contract Area on the Effective Date. (b) Where the Lessee has prior to the end of the Second Phase of the Basic Exploration Stage, given to the Lessor notice under Article 2.1(c) the Lessee shall before commencement of the Third Phase relinquish a portion or portions of the Contract Area (providing they comprise a number of contiguous Elementary Blocks) so that the Contract Area retained is not more than sixty per cent (60%) of the Contract Area on the Effective Date. to Article 7 has become an Exploitation Area. (d) When, pursuant to this Article, the Lessee surrenders or relinquishes part of the Contract Area the remaining area or areas shall be rectangular in shape and constitute not more than two non-contiguous areas. 6.3 Clean-up Prior to surrender or relinquishment of the Contract Area or any part of it, the Lessee shall: (a) in accordance with Good Oilfield Practices, perform any necessary clean-up activities including removal of any facilities and equipment installed by the Lessee, in order to restore such area as nearly as possible to the original condition that existed on the Effective Date; (b) fulfil its obligations under Articles 9.1 and 9.2; and (c) take action necessary to prevent hazards to environment, human life or property. 7.1 Where the Lessee makes a Discovery of Hydrocarbons in the Contract Area it shall inform the Lessor promptly by notice in writing and communicate the test(s) and/or other technical evaluation(s) to be made in connection with the Discovery in order to determine the extent to which the Discovery is potentially of commercial interest. The results from those tests and/ or technical evaluations thereof shall be submitted to the Lessor as soon as such tests and/ technical evaluations have been completed. 7.2 Where the Lessee makes a discovery of any subsoil resource in the Contract Area which is not a Hydrocarbon, it shall inform the Lessor promptly by notice in writing. 7.3 Save in the event that the Lessee informs the Lessor when test results are submitted that the Discovery does not merit appraisal, or does not merit appraisal until further exploration drilling has taken place in the Contract Area, the Lessee shall, when the tests referred to in Article 7.1 are completed, prepare and submit to the Lessor for approval an Appraisal Programme relating to the Discovery. Within two (2) Months from the date on which the Appraisal Programme is submitted to the Lessor, the Lessor will approve the Appraisal Programme unless, after its review by the Technical Advisory Committee, the Lessor determines that the Appraisal Programme is unlikely to satisfy the requirements of Article 7.5 (a) to (e). In that event, if the Lessor and the Lessee are unable to agree appropriate changes to the Appraisal Programme, the matter or matters in dispute will be referred to a Sole Expert for determination in accordance with Article 23. 7.4 When an Appraisal Programme has been completed, the Lessee will inform the Lessor by a notice in writing whether the Discovery is commercially exploitable, and the determination of the Lessee in that regard shall be final. 7.5 A notice in writing under Article 7.4 shall be accompanied by a report on the Discovery containing particulars of:1. The chemical composition, physical and thermodynamic properties and quality of Hydrocarbons discovered;

The thickness and extent of the production strata; 3.Petrophysical properties of the Hydrocarbon Reservoir formations; 4.The Hydrocarbons Reservoir's productivity indices for the wells tested at various rates of flow; 5.Permeability and porosity of the Hydrocarbon Reservoir formations; Lessee in relation to the Discovery; 8.Evaluation of the Hydrocarbons Reservoir and adjoining areas; and 9.Additional geological data and other relevant information relating to the Discovery. 7.6 Where the Lessee by notice in writing under Article 7.4, has informed the Lessor that the Discovery is commercially exploitable: 1.as soon as possible thereafter, the Lessor and the Lessee will meet and delimit by mutual agreement the Exploitation Area in respect of the Discovery, to the extent that such a delimitation is possible within the boundaries of the Contract Area. Notwithstanding solely the size limitations set out in paragraph 9 of article 5 of the Hydrocarbons Law, the said Exploitation Area shall include, in a single area, the Hydrocarbons Reservoir in respect of which the notice was given under Article 7.4, together with a reasonable margin surrounding the periphery of that area. In the event that the Lessor and the Lessee are unable, within sixty (60) calendar days from the date of the notice under Article 7.4, to agree on the boundaries of the Exploitation Area, either the Lessor or the Lessee may refer the matter for determination by a Sole Expert in accordance with Article 23. 2.Without prejudice to the provisions of Article 2.3(b), the Lessee will prepare and submit to the Lessor, not later than six (6) Months from the date of the notice given under Article 7.4, a Development and Production Programme in respect of the Discovery. The Development and Production Programme shall be consistent with the requirements listed in paragraph 2 article 2 of the Presidential Decree, be prepared on sound engineering and economic principles in accordance with Good Oilfield Practices and be designed to ensure: (i) the optimum economic recovery of Hydrocarbons by the efficient, beneficial and timely use of the hydrocarbon resources of the Exploitation Area; and (ii) adequate measures for the protection of the environment in conformity with accepted standards prevailing in the international petroleum industry, and taking account of the particular characteristics of the Contract Area. 3.Without prejudice to the generality of the requirements set out in Article 7.6(b), the Development and Production Programme will contain the following particulars: (i) Feasible alternatives for the development and production of the Discovery, including the method for disposition of Associated Gas; (ii) Proposals relating to the spacing, drilling and completion of production and injection wells, the production and storage installations and transport and delivery facilities (A) estimated number of production and injection wells; (B) particulars of production equipment and storage facilities; (C) particulars of feasible alternatives for transportation of the Hydrocarbons including pipelines; (D) particulars of installations and other technical equipment required for the operations; (1) The production profiles for Crude Oil and Natural Gas from the Hydrocarbon Reservoirs; (2) Specific steps which the Lessee proposes to take during production in accordance with Good Oilfield Practices to prevent pollution and to restore the environment when the Exploitation Stage terminates; (3) Cost estimates of capital and recurrent expenditures; (4) Economic feasibility studies carried out by or for the Lessee in respect of the Discovery taking into account the location, meteorological conditions, cost estimates, the price of Hydrocarbons and any other relevant data; and evaluations thereof; (5) Safety measures to be adopted in the course of the Exploitation Operations, including without limitation, measures complying with the “Offshore Safety Law” and dealing with emergencies; (6) Estimate of the time required to complete each phase of the Development and Production Programme; and (7) The Delivery Point for the delivery of the Lessor In-Kind Royalty. 7.7 At or before the time the Development and Production Programme is submitted to the Lessor, the Lessee , if so requested by the Lessor and in addition to the EIS prepared in accordance with Article 12, shall make available to the Lessor, in accordance with Article 12, an environmental impact study prepared by an Independent Third Party (approved by the Lessor) with expertise in the field of international environmental studies, for the purpose of assessing the effects of the proposed development on the environment, including its effect on human beings, wild life and aquatic life in and around the Exploitation Area. This environmental impact study shall, as a minimum, address the matters referred to in Article 12.6. Within two (2) Months from the date on which the Development and Production Programme was submitted to the Lessor, the Lessor will approve the Development and Production Programme unless the Lessor, after review of such Programme by the Technical Advisory Committee, determines that the Programme does not satisfy the requirements of Article 7.6(b). In that event, if the Lessor and the Lessee are unable to 7.8 Subject to Article 23.2(f), the opinion of the Sole Expert shall be binding on the parties with the effect that: 1.if the Sole Expert is of the opinion that the Development and Production Programme as submitted by the Lessee meets the requirement of Article 7.6 (b), the Development and Production Programme shall be deemed to have been approved by the Lessor; 2.if the Sole Expert is of the opinion that the Development and Production Programme does not meet the requirements of Article 7.6(b), the Lessee shall, not later than sixty (60) calendar days from the date on which the expert has given his opinion, either re-submit the Development and Production Programme amended to take account of the opinion of the Sole Expert or surrender the Exploitation Area; and 3.where the Lessee has re-submitted the Development and Production Programme, amended as aforesaid, the Development and Production Programme, as so amended, shall be deemed to have been approved by the Lessor within one week after receipt by the Lessor. 8.1 Subject to the possibility of an extension (for two (2) extensions of five (5) years each) in accordance with paragraph 13 of article 5 of the Hydrocarbons Law, the duration of the Exploitation Stage for each Exploitation Area shall be twenty five (25) years from the date on which a notice was given by the Lessee to the Lessor under Article 7.4. 8.2 The Lessee may at any time unconditionally surrender 100% of its Hydrocarbons Exploitation rights over any one (1) or more or over all of the Exploitation Areas created under the terms of Article 7.6, by serving notice to the Lessor ninety (90) calendar days in advance. Such surrender shall give the Lessee no claim whatsoever against the Lessor in respect of costs or damages. Surrender by the Lessee of less than 100% of its exploitation rights in any Hydrocarbons Exploration Area or surrender with conditions shall not be permitted, but nothing in this paragraph shall be read or construed as prohibiting a Co-Lessee from withdrawing from the Agreement provided that its rights and obligations under this Agreement are assumed by the remaining CoLessees (or by a third party) in accordance with Article 20. 8.3 Upon the expiration of the Exploitation Stage in any Exploitation Area, this Area shall revert, free and clear, to the State. (a) The use of real property, which has been acquired pursuant to the provision of paragraphs 1 to 3 inclusive, of article 6 of the Hydrocarbons Law and paragraphs 1 to 5, inclusive, of article 11 of the same Law, and the ownership of moveable property, the value of which has been fully depreciated, shall be turned over to the Lessor ipso jure without the payment of any consideration. (b) Real property which has not been acquired pursuant to the provision of paragraphs 1 to 3, inclusive, of article 6 of the Hydrocarbons Law and paragraphs 1 to 5, inclusive of article 11 of the same Law and, without prejudice to Article 10.5, movable property, the value of which has not been fully depreciated shall be transferred to the Lessor at a fair market value taking due account of the condition of each asset and making allowance for depreciation already recovered hereunder. In the event that an agreement cannot be reached on a fair market value for any asset, the matter shall be referred for determination to a Sole Expert under Article 23. (c) In respect of the assets acquired by the Lessor under this Article, the Lessor shall bear no responsibility whatsoever to the lenders of the Lessee, if any, for any of the Lessee's debts and the Lessee hereby indemnifies and holds harmless the Lessor against any claims by such lenders, if any. In the event that security has been granted in favour of any such lender the Lessee is obliged to release the security before the any Exploitation Area, any such real property and/or assets are still required by the Lessee for its Petroleum Operations in other Exploitation Area(s) in the Contract Area, the Parties shall meet to agree if, to what extent and under what conditions such transfer to the State shall occur so as to allow the Lessee to conduct its Petroleum Operations in the remaining Exploitation Area(s). 8.4 Unless the Lessor states otherwise not later than six (6) Months prior to the expiration of the Exploitation Stage the Lessee shall be obliged to: (a) plug all producing wells and known water zones and/or aquifers: (b) remove all installations; and (c) restore the environment in accordance with the proposals set out in the Development and Production Programme, the EIS and any further environmental impact study prepared pursuant to Article 12. 8.5 A committee shall be formed in accordance with the provisions of Article 8.6 for the monitoring and coordination of work to ensure the fulfilment of the Lessee's obligations under Article 8.4 ("The Committee for the Removal and Disposal of the Installations"). This Committee shall comprise three (3) members. One member shall be appointed by the Lessor, one by the Lessee and the third member, who shall be the chairman of the Committee, shall be appointed by the two already appointed members, jointly. This third member shall be selected from persons who are independent of the Lessor and the Lessee and have experience on matters of Good Oilfield Practices. If the two members fail to appoint the third member of such Committee within thirty (30) calendar days of their appointment, the Lessor or the Lessee shall be entitled to request the selection and the appointment of the third member by the Sole Expert. (a) The time when the Committee for the Removal and Disposal of the Installations shall be empowered to act shall be determined by the mutual agreement of the Lessor and the Lessee which shall be reached upon either the date referred to in Article 8.6 (i) or in Article 8.6 (ii). (b) The Committee shall examine all technical, legal, environmental and fiscal matters related to the removal of the installations and may, at its discretion, request the assistance of specialists on such subjects. (c) The Committee shall decide in accordance with the opinion of the majority of its members and its decisions shall be binding upon the Lessor and the Lessee. The Committee's decision is subject to the approval of the Minister. (d) The Committee's expenses shall be paid by the Lessee and shall be debited to the Lessee's income and expenditure account. Decree, the Lessee shall, either from (i) the beginning of the sixth year from the Commercial Production Date where Crude Oil is produced; or, (ii) the beginning of the ninth year from the Commercial Production Date where Natural Gas, or Natural Gas and Condensates are produced, open a special dedicated account in a bank or banks legally operating in Greece. During the Exploitation Stage it shall periodically deposit annual amounts into such account and such funds, plus any interest thereon, shall be developed to be the Lessee’s special reserve for the fulfilment of its obligations to remove the installations. The procedure and all relevant details for these periodic deposits shall be mutually agreed upon the Commercial Production Date. If no agreement is reached, the matters in issue shall be referred to the Sole Expert for determination as provided in Article 23.2. 8.7 The time when the special reserve shall be used as well as the necessary amounts and the time when the Lessee shall deposit them, shall be determined by decision of the Committee for the Removal and Disposal of the Installations. Any funds accumulated in the special reserve, without the relevant interest, shall be debited to the Lessee's income and expenditure account. 8.8 The obligations to remove installations may be suspended following the consent of the Minister for whatever period of time the existence of such installations is considered necessary for the performance of the Lessee's operations in the Contract Area or in another contract area, in accordance with the provisions and the procedure laid down in paragraph 4 of Article 10 of the Hydrocarbons Law. 8.9 The provisions of Article 8.4 shall apply mutatis mutandis where the Lessee is declared to have forfeited pursuant to paragraphs 8 to 11 (inclusive) of article 10 of the Hydrocarbons Law or where the Lessee surrenders its Hydrocarbons Exploitation rights pursuant to paragraph 14 of article 5 of the same Law and Article 8.2. The provisions of Articles 8.6 and 8.7 shall also apply, mutatis mutandis, if the Committee for the Removal and Disposition of Installations has been established, where such forfeiture or surrender has taken place. 9.1The Lessee will carry out Petroleum Operations in the Contract Area: (a) in accordance with: (i) the Hydrocarbons Law and Offshore Safety Law and other applicable provisions of the Law, including but not limited to regulations made under paragraph 1 of article 12A of the Hydrocarbons Law; and (ii) the Presidential Decree, which in accordance with paragraph 29 of article 2 of the Hydrocarbons Law, is applicable to this Lease Agreement; (b) diligently, in accordance with Good Oilfield Practices, and in a safe workmanlike manner and, in respect of Petroleum Operations in any Exploitation Area, in compliance with the Development and Production Programme for that area. 9.2 Without prejudice to the generality of the foregoing, the Lessee, in accordance with such laws as may be prescribed from time to time, will: (a) take all reasonable measures to control the flow and to prevent loss in any form or waste of Hydrocarbons above or under the ground during drilling, producing, gathering, distributing or storage operations; (b) take whatever practical measures are necessary to prevent any injurious ingress of water or damage of any kind to any Hydrocarbon-bearing formation which may be encountered while drilling operations are in progress, or upon abandonment of any well and shall carefully locate and preserve any fresh water sources discovered in the course of such operations; (c) take all reasonable precautions against fire and any unwarranted wasting of Hydrocarbons or water; (d) upon completion of the drilling of a well, inform the Lessor when the well will be tested and the production rate ascertained; (e) except in instances where multiple producing formations in the same well can be produced economically only through a single tubing string, refrain from producing Hydrocarbon from multiple oil carrying zones through one string of tubing at the same time, except with the prior written approval of the Lessor. cause pollution or other environmental damage harmful to people, animals, aquatic life or vegetation, take, as may be required by the Lessor, remedial measures and repair damage to the environment; (g)effect and maintain for Petroleum Operations insurance coverage of the type, and in such amount, as is customary in the international petroleum industry in accordance with Good Oilfield Practices, and, on request, furnish to the Lessor certificates evidencing that such coverage is in effect when any surrender takes place. The said insurance shall, without prejudice to the generality of the foregoing cover those matters described in Annex E, and be subscribed towards insurers and/or reinsurers (including Affiliate Enterprises and captives) with a minimum Standard and Poors’ rating of A-; (h) require its contractors and sub-contractors to carry insurance of the type and in such amount as is customary in the international Petroleum industry in accordance with Good Oilfield Practices; and (i) indemnify, defend and hold the Lessor harmless against claims, losses and damages of any nature whatsoever, including, without limitation, claims for loss or damage to property, injury or death to persons or damage to the environment caused by or resulting from Petroleum Operations conducted by or on behalf of the Lessee, provided that the Lessee shall not be held responsible to the Lessor under this provision for any loss, claim, damage or injury caused by or resulting from gross negligence or wilful misconduct of personnel employed by the Lessor or from action done at the direction of the Lessor. 9.3 The Lessee shall promptly notify the Lessor of any serious events within the Contract, Area or of any serious damage to the installations capable of impeding the performance of the Annual Work Programme and Budget. If, and to the extent, acts or omissions on the part of the Lessee its agents or servants, cause liability of the Lessor towards third parties, it shall indemnify and hold harmless the Lessor in respect of all such liability. 9.4 The Lessee shall, before drilling any Exploration or Appraisal Well: (a) notify the Minister: (i)at least two (2) Months before the spudding of an Exploration Well: and (ii)at least one (1) week before the spudding of an Appraisal Well; and (ii) at least one (1) week before the spudding of an Appraisal Well. 9.5 Where the Lessee has, for the purpose of implementing a Development and Production Programme relating to one or more Exploitation Areas, constructed one or more pipeline(s), the Lessee shall on the application of the Lessor and subject to available capacity, in respect of which the Lessee shall have priority, make its pipeline available to transport the Hydrocarbons of the Lessor or of Independent Third Parties. The Hydrocarbons aforesaid shall be transported by the Lessee on reasonable and fair market terms and conditions and where agreement on such terms cannot be reached by the Lessee and the Lessor, or as the case may be, the Lessee and an Independent Third Party within one hundred and twenty (120) calendar days of the commencement of discussions, the issue or issues in dispute shall be referred to an Sole Expert for determination under Article 23. 9.6 Three (3) Months before the beginning of each Calendar Year, the Lessee shall submit to the Lessor a statement showing the anticipated production of Hydrocarbons and ByProduct(s) for the following Calendar Year and their expected values. Three (3) Months prior to the anticipated commencement of first regular production of the Hydrocarbons and By-Products, the Lessee shall submit a similar statement covering the period to the end of the then current Calendar Year. 10.1 The Lessee shall have the exclusive right to carry out Petroleum Operations in the Contract Area and, to manage such operations. 10.2 Subject to the provisions relating to the safety of installations, representatives of the Lessee, its personnel, and the personnel of its contractors and of their sub-contractors may enter the Contract Area and have free access to all installations of the Lessee. 10.3 Subject to the provisions of paragraph 12 article 7 of the Hydrocarbons Law and of Article 13, relating to joint title where royalties are taken as In-Kind Royalty as set out in Article 13, each Co-Lessee, according to its interest in this Agreement under Article 1.5, shall have unencumbered title at the wellhead to all Hydrocarbons Produced and Saved in the Contract Area. 10.4 The Lessee, its contractors and their sub-contractors shall be entitled to freely re-export any items they import into the country. 10.5 The Lessee shall be entitled to sell, within or outside the country, equipment, as well as materials resulting from the dismantling of installations no longer in use by notifying the Lessor within two (2) Months of the objects to be sold and their prices. 10.6 No Governmental Authority shall grant to any third party any Hydrocarbons prospecting or other related license in the Contract Area (or any part of it) to collect seismic and other data with the view to assessing its oil and gas potential without the prior written consent of the Lessee. 11.1 If a Hydrocarbons Reservoir extends beyond the limits of the Contract Area of the Lessee into the contract area of another lessee, upon the invitation of the Minister the Lessee shall jointly with the lessee of the adjoining contract area prepare and submit to the Minister within the time specified by the Minister a unitization programme of Hydrocarbons Exploration and Exploitation of the Hydrocarbons Reservoir. If such a unitization programme is not submitted within the applicable timeframe, the Minister shall prepare such a programme and the Lessee shall perform and observe all the terms and conditions thereof, failing which the Lessor shall be entitled to terminate this Agreement in accordance with paragraph 15 of Article 5 of the Hydrocarbons Law. 11.2 If a Hydrocarbons Reservoir extends beyond the limits of the Contract Area of the Lessee into an area where the State has the exclusive rights of Hydrocarbons Exploration and Exploitation, upon invitation by the Minister, the Lessee shall prepare a joint development plan for the Hydrocarbons Exploration and Exploitation of the Hydrocarbons Reservoir. Following the submission of a joint development plan the Lessor shall proceed in accordance with paragraph 15 of Article 5 of the Hydrocarbons 11.3 As from the date when the Minister invites the Lessee to prepare a unitization programme in accordance with Article 11.1, or a joint development plan in accordance with Article 11.2, the time limits set for the fulfilment by the Lessee of its contractual obligations shall be suspended only insofar as the obligations are solely and directly related to matters arising under the unitization process described in this Article 11. 12.1All capitalized terms in this Article 12 which are not otherwise defined in this Agreement have the meaning assigned to them in the Environmental Laws and the Offshore Safety Law. 12.2 Further to the preceding article, the Lessee shall: (a) conduct all Petroleum Operations in a manner which will assure the protection of environment in accordance with Good Oilfield Practices; (b) carry out all Petroleum Operations in full compliance with: (i) the Environmental Laws; (ii)the Offshore Safety Law; (iii) the approved Strategic Environmental Assessment (SEA); (iv) the Terms of Environment (ToE) resulting from the relevant Environmental Impact Assessment (EIA) procedure ; and (v) any additional Environmental Action Plan (EAP), pursuant to this Article and Good Oilfield Practices, while ensuring that such operations are properly monitored; (c) employ modern and appropriate techniques in accordance with Good Oilfield Practices, for preventing any environmental damage that might be caused by the Petroleum Operations, and for minimizing the environmental impacts of the Petroleum Operations and works within the Contract Area and in adjoining or neighbouring or more distant areas; (d) properly and timely implement any Laws in force regarding the safety of Hydrocarbons exploration and production activities during the period of Petroleum Operations; (e) procure that the documentation on environmental compliance in conducting Petroleum Operations, such as SEA, ToE or EAPs and associated documents are made available to its employees and to its contractors and their subcontractors to develop adequate and proper awareness of the measures and methods of environmental protection to be used in conducting Petroleum Operations; and (f) ensure that any agreement between the Lessee and its contractors and their subcontractors relating to the Petroleum Operations shall include, where applicable, terms Agreement. 12.3 The Lessee undertakes for the purposes of this Agreement to take all necessary and adequate steps: (a) to fully and timely fulfil all requirements of applicable Environmental Laws; and (b) to prevent environmental damage to the Contract Area and neighbouring or more distant areas being caused by Petroleum Operations. 12.4 If the Lessor has on reasonable grounds reason to believe that any works or installations erected by the Lessee or any operations carried out by the Lessee are endangering or may endanger persons or any property of any other person or are causing pollution or are harming wildlife, aquatic life or the environment to a degree which the Lessor deems unacceptable, the Lessee should take remedial measures within such period as may be determined by the Lessor and repair any damage to the environment, the costs of such remedial action to be borne by the Lessee. If the Lessor deems it necessary, it may require the Lessee to discontinue Petroleum Operations in whole or in part until the Lessee has taken such remedial measures or has repaired any damage attributable to it. 12.5 The measures and methods to be applied by the Lessee for the purposes of complying with the terms of this Article 12 shall be determined in timely consultation and agreed with the Lessor prior to the commencement of the relevant Petroleum Operations and/or associated works and whenever there is a significant change in the scope or method of carrying out Petroleum Operations, and the Lessee shall take into account Good Oilfield Practices, as well as the relevant requirements of the ToE. 12.6 Pursuant to Article 12.2(a), the Lessee shall prepare and submit to the competent governmental authority, an Environmental Impact Study (EIS) for the relevant Petroleum Operations in respect of which an EIA procedure is required. The EIS shall, as a minimum: (a) fully comply with the requirements of the EIA legislation in force; (b) meet the requirements and guidelines set out by SEA; and (c) be prepared by a third party with adequate expertise in the field of environmental studies, which will be appointed by the Lessee to work on its behalf. 12.7 Each project, work, activity or any other part of the Petroleum Operations that is subject to an EIA, shall commence only after the 2D% have been approved. 12.8 Any modification, expansion, improvement or modernization of a project, work, activity or any other part of the Petroleum Operations with approved ToE, requires 12.9 In case of activities for which an EIA is not mandatory, but nevertheless it is reasonably expected that some minor environmental impacts may occur, as in particular for the case of seismic surveys, the Lessee shall prepare an EAP, to determine, assess and mitigate these impacts, focusing on prevention and minimization thereof in accordance with Good Oilfield Practices. 12.10 The EAP shall be submitted to the Lessor for review and must be complied with by the Lessee. 12.11 The Lessee shall include in each Annual Work Programme and Budget to be submitted to the Lessor, an environmental report on the work to be undertaken as provided in that document, as well as on the work undertaken in accordance with the preceding Annual Work Programme and Budget. 12.12 Before carrying out any drilling activities, the Lessee shall fully meet the requirements of the applicable legislation for safety, contingency (i.e. oil spill, fire, accident, emissions etc.) and major hazard management plans. 12.13 In the event of any emergency or accident arising from Petroleum Operations affecting the environment, the Lessee shall immediately notify the Lessor, giving details of the incident and immediately implement the relevant contingency plan. In dealing with any emergency or accident affecting the environment, the Lessee shall at all times take such action as is prudent and necessary in accordance with the Environmental Laws and Good Oilfield Practices in the circumstances. 12.14 The Lessee shall not be liable for any environmental condition or damage existing in the Contract Area prior to the commencement of the Petroleum Operations. For this purpose, a baseline report shall be prepared by the Lessee, to detail the condition of the environmental parameters and resources existing at the time prior to Petroleum Operations’ commencement. The baseline report shall be submitted for review to the Lessor. If no objection is raised by the latter within twenty (20) Business Days, the report is deemed accepted. 13.1In accordance with the Presidential Decree, the Lessee shall pay to the Lessor a Royalty on all Hydrocarbons and By-Products Produced and Saved in the Contract Area. The Royalty shall be calculated and payable in accordance with the provisions of this Article 13. For the purposes of this Article 13: "Actual In-Kind Royalty" means, in respect of the First Period or any subsequent Calendar Quarter, the In-Kind Royalty determined in accordance with Article 13.5.(b). "Actual Production" means, in respect of the First Period or any subsequent Calendar Quarter, the total quantity of Hydrocarbons and By-Products Produced and Saved from the Contract Area during that First Period or that Calendar Quarter, as the case may be, as set out in a statement prepared by the Lessee in accordance with Article 13.7 and section 5 of Annex C (the “Exploitation Statement”). “Cash Royalty” means any Royalty the Lessor elects to take in cash in accordance with Article 13.3. “Cash Royalty Calculation Date” means each of the following dates: (i) in respect of the First Period, and in respect of each subsequent Calendar Quarter, that date which is thirty (30) calendar days after the commencement of the next Calendar Quarter; and (ii) the date of termination of this Agreement. “Cash Royalty Payment Date” means each of the following dates: (i) in respect of the First Period, and in respect of each subsequent Calendar Quarter, that date which is forty five (45) calendar days after the commencement of the next Calendar Quarter, and (ii) the date of termination of this Agreement. “Cumulative Gross Inflows” means in respect of the First Period or any subsequent Calendar Quarter the cumulative gross value of: (i) Hydrocarbons and By-Products Produced and Saved (as determined under the provisions of Article 16) from the Contract Area; (ii) sales of assets acquired for use in connection or associated with Petroleum Operations; and (iii) the net proceeds of the transactions described in paragraph 3.6 of Annex C, any other income in connection or associated with Petroleum Operations including, but not due to the Co-Lessee or its Affiliate Enterprise, income derived for the generation of electrical power and income resulting from any insurance policy or indemnity, for all years from the Commercial Production Date up to and including the last day of that First Period or subsequent Calendar Quarter, as the case may be. For the purposes of this definition, gross value means the value prior to the deduction of any Royalty, taxes, duties or other fiscal impositions, transportation, handling, agency or any other costs or expenses of any nature whatsoever. “Cumulative Total Outflows” means, for the First Period and all subsequent Calendar Quarters, the cumulative sum of all Exploration Costs, Exploitation Costs, Operating Costs and other deductible costs referred to in Section 3 of Annex C for all periods from the Effective Date up to and including the last day of that First Period and each subsequent Calendar Quarter, as the case may be. “Estimated In-Kind Royalty” means in respect of the First Period or any subsequent Calendar Quarter, the estimate of the In-Kind Royalty for such period, as determined in accordance with Article 13.5.(a). “Estimated In-Kind Royalty Calculation Date” means each of the following dates: (i) in respect of the First Period, such date (as agreed between the Parties) which is at least two (2) Months prior to the estimated Commercial Production Date; and (ii) in respect of each subsequent Calendar Quarter, such date (as agreed between the Parties) which is at least two (2) Months prior to the first day of that Calendar Quarter. “Estimated Production” means in respect of the First Period and each subsequent Calendar Quarter, the Lessee's estimate of the total quantity of the Hydrocarbons and By-products to be Produced and Saved from the Contract Area during such period. “Estimated R Factor” means in respect of: (i) the First Period and the next Calendar Quarter, the Lessee's estimate of what the R Factor will be for each such period; (ii) the second Calendar Quarter after the First Period, the R Factor for the First Period; and (iii) each subsequent Calendar Quarter, the R Factor for that Calendar Quarter which immediately preceded the immediately preceding Calendar Quarter. “Estimated Royalty Percentage” means, in respect of the First Period and in respect of each subsequent Calendar Quarter, the Royalty Percentage for such period calculated by reference to the Estimated R Factor for that period. “First Period” means, that period from the date of the notice sent by the Lessee to the Lessor in accordance with Article 7.4 informing the Lessor that a Discovery is commercially exploitable up to the commencement of that Calendar Quarter which immediately succeeds the Commercial Production Date. “In - Kind Royalty Calculation Date” means each of the following dates: (i) in respect of the First Period and each subsequent Calendar Quarter that date which is thirty (30) calendar days after the commencement of the next Calendar Quarter; and (ii) the date of termination of this Agreement; “Royalty Percentage” means, in respect of the First Period and in respect of each subsequent Calendar Quarter, that percentage, calculated by reference to the R Factor, such that, if the R Factor in respect of such period is:

lower than or equal to 0.5, the Royalty Percentage shall be four per cent (4%);

higher than 0.5, but lower than or equal to 1.0, the Royalty Percentage shall be five per cent (5%);

higher than 1.0, but lower than or equal to 1.5, the Royalty Percentage shall be six per cent (6%); 4.higher than 1.5, but lower than or equal to 2.0, the Royalty Percentage shall be seven per cent (7%); 5.higher than 2.0 , the Royalty Percentage shall be fifteen per cent (15%); “R Factor” means, in respect of the First Period and in respect of each subsequent Calendar Quarter, the product of: (i) Cumulative Gross Inflows for the First Period or that Calendar Quarter, as the case may be, divided by (ii) Cumulative Total Outflows for the First Period or that Calendar Quarter, as the case may be. Regarding the calculation of the R factor: (i) Any amounts deposited in the special dedicated reserve for decommissioning or removal of installations and the rectification of the Contract Area (“Abandonment”) and if applicable, the total amount of actual expenses for Abandonment work not covered by the special reserve, are considered and shall be treated as deductible costs. (ii) All costs and expenses, in relation to the loans to finance the Petroleum Operations, including but not limited to, interest and finance charges incurred by each Co-Lessee are not considered a deductible cost. (iii) Royalties are included in the denominator (Cumulative Total Outflows) of the R factor. 13.2 The Royalty to be paid by the Lessee to the Lessor shall be calculated as a percentage of the Hydrocarbons and By-Products Produced and Saved from the Contract Area in respect of the First Period and each subsequent Calendar Quarter in accordance with the following provisions of this Article 13. 13.3 The Lessor may elect, in its discretion, to take its Royalty in-kind ("In-Kind Royalty"), or in cash ("Cash Royalty") or in a combination of both in respect of any Calendar Year. If the Lessor wishes to take all or part of the Royalty as a Cash Royalty the Calendar Year in which Hydrocarbons are produced, at least two (2) Months prior to the estimated Commercial Production Date). The Lessor shall also specify the percentage of Royalty entitlement it intends to take as a Cash Royalty during that year (or in respect of the first Calendar Year in which Hydrocarbons are produced, during the remaining part of that Calendar Year). If the Lessor does not elect to take all or part of the Royalty as a Cash Royalty, in respect of any Calendar Year the Lessor shall be deemed to have elected to take all of the Royalty as an In-Kind Royalty in respect of that Calendar Year. That proportion of the Royalty the Lessor is to take as a Cash Royalty shall be calculated and paid in accordance with Article 13.4. The proportion of the Royalty the Lessor is to take as an In-Kind Royalty shall be calculated and delivered in accordance with Article 13.5. 13.4 If, in respect of any Calendar Year, the Lessor elects to take any part of its Royalty as a Cash Royalty, the following provisions shall apply: 1.The Cash Royalty (if any) in respect of the First Period and each subsequent Calendar Quarter shall be calculated on the Cash Royalty Calculation Date in respect of the First Period or that subsequent Calendar Quarter, as the case may be, and shall be paid by the Lessee to the Lessor on the Cash Royalty Payment Date in respect of the First Period or that subsequent Calendar Quarter, as the case may be. 2.On the Cash Royalty Calculation Date in respect of the First Period and on the Cash Royalty Calculation Date in respect of each subsequent Calendar Quarter, the Lessee shall determine the amount of the Cash Royalty for such period by: (i) determining the R Factor and then the Royalty Percentage in respect of the First Period or that subsequent Calendar Quarter, as the case may be; (ii) multiplying the Royalty Percentage determined in accordance with Article 13.4 (b) (i) above by the Actual Production for the First Period or that Calendar Quarter, as the case may be; (iii) multiplying the amount determined in accordance with Article 13.4.(b) (ii) by a percentage which is equal to the percentage of the Royalty for that Calendar Year for which the Lessor has elected to take Cash Royalty in accordance with Article 13.3; and (iv) calculating the cash value of the amount determined in accordance with Article 13.4.(b) in accordance with Article 16 (Valuation of Hydrocarbons). 13.5 If, in respect of any Calendar Year, the Lessor elects or is deemed to elect to take any part of its Royalty as an In-Kind Royalty, the following provisions shall apply: (a) On the Estimated In-Kind Royalty Calculation Date in respect of the First Period and each subsequent Calendar Quarter, the Lessee shall: Estimated Royalty Percentage for the First Period or that Calendar Quarter, as the case may be; (B) multiplying the Estimated Royalty Percentage determined in accordance with Article 13.5,(a)(i)(A) by the Estimated Production for the First Period or that Calendar Quarter, as the case may be; and (C)multiplying the amount determined in accordance with Article 13.5.(a)(i)(B) above by a percentage which is equal to the percentage of the Royalty for that Calendar Year which the Lessor has elected or is deemed to have elected to take in-kind in accordance with Article 13.3; and (ii) with the Lessor, prepare a programme pursuant to which the Lessor shall take delivery of such Estimated In-Kind Royalty during such period, and the Lessee shall be obliged to deliver the Estimated In-Kind Royalty in accordance with the agreed programme at the Delivery Point. (b) On the In-Kind Royalty Calculation Date in respect of the First Period and each subsequent Calendar Quarter the Lessee shall determine the amount of the In-Kind Royalty by: (i) determining the R Factor and then the Royalty Percentage for the First Period or that Calendar Quarter, as the case may be; (ii) multiplying the Royalty Percentage determined in accordance with Article 13.5.(b)(i) above by the Actual Production for the First Period or that Calendar Quarter, as the case may be; and (iii) multiplying the amount determined in accordance with Article 13.5.(b)(ii) by a percentage which is equal to the percentage of the Royalty for that Calendar Year which the Lessor has elected or is deemed to have elected to take in kind in accordance with Article 13.3; (c) If the Estimated In-Kind Royalty for the First Period or any subsequent Calendar Quarter is less than or greater than the Actual InKind Royalty for the same period, then an appropriate adjustment shall be made to future In-Kind Royalties or Cash Royalties to be delivered or paid by the Lessee to the Lessor in order to correct any such difference according to the provisions of article 2.3(b) of the Presidential Decree. 13.6 If a Cash Royalty shall become due to the Lessor, each Co-Lessee, according to its In-Kind Royalty shall become due to the Lessor, the Lessor and each Co-Lessee, according to its respective interest in this Agreement as set out in Article 1.5, shall become, as from the time of the extraction of the Hydrocarbons until delivery of the royalty to the Lessor is made, joint owners thereof in proportions by which the Lessor's royalty entitlement and the Lessee's entitlement (after deduction of the Lessor's Royalty entitlement) for the First Period or that Calendar Quarter, as the case may be, bear to the total volume of Hydrocarbons and By-Products Produced and Saved in the First Period or that Calendar Quarter, as the case may be. 13.7 Within fourteen (14) calendar days of the end of the First Period and the end of each subsequent Calendar Quarter the Lessee shall submit to the Lessor a statement showing the Actual Production for the First Period or that Calendar Quarter, as the case may be in accordance with the procedure and as contemplated in Section 5 of 13.8 The Lessee shall bear all risks, costs and expenses associated with the Lessor's In-Kind Royalty up to the delivery point agreed between the Parties in the Development and Production Programme and the Lessor shall bear all risks, costs and expenses beyond that delivery point. 13.9 Subject to the provisions of this Article concerning the Lessor's right to take an InKind Royalty, each Co-Lessee shall be entitled to export freely the Hydrocarbons and By-Products produced. 13.10 Without prejudice to the provisions of Article 1.4 and notwithstanding anything to the contrary in this Agreement, any payment due to the Lessor under this Article 13 shall be made by the Lessee. The tax regime of this Agreement is exclusively governed by the provisions of the present Article and Article 31 and, with the exception of paragraph 5 of article 8 and paragraphs 10 and 11 of article 9 of the Hydrocarbons Law, the provisions of articles 8 and 9 of the Hydrocarbons Law do not apply. Notwithstanding anything to the contrary in this Article, the present Article shall not be deemed to create or imply to create any de jure or de facto partnership, or entity with or without a separate legal personality. 14.1 Each Co-Lessee shall be subject to a special income tax, at a rate of twenty per cent (20%) and to a regional tax, at a rate of five per cent (5%), without any additional ordinary or extraordinary contribution, duty or other encumbrance of any kind, in favour of the State or any third party. The tax shall be imposed on the net taxable income earned by each Co-Lessee’s operations under this Agreement, as determined by the provisions of this Article. The imposition of this tax exhausts the income tax obligations of each Co- Lessee as well as its shareholders/partners/ members, with respect to the profits resulting from its contractual operations. The assessed tax in respect of a Year is payable in one payment. Notwithstanding the provisions of the Income Tax Code and the Taxation Procedures Code, each Co-Lessee shall be exempted from the obligation of advance payment of income tax for the tax corresponding to income arising from its contractual operations. 14.2 All the works, the purchases of fixed assets and the other expenses which are required for the fulfilment of the purposes of this Agreement as stipulated in detail in Article 14.7 are carried out by the Operator in its name on behalf of the Co-Lessees. The Operator concludes the required contracts, receives the relevant invoices in accordance with the tax legislation and records them in its books separately per each Exploration or Exploitation Area. The Operator issues a monthly clearance document until the 15th day of the following month allocating the above expenses to each CoLessee in accordance with the percentage that each Co-Lessee holds in this Agreement. VAT, where applicable, is passed on to each Co-Lessee through the clearance document. The clearance document which constitutes a record to be used for the accounting entries in the books of the Co-Lessees and the Operator, is accompanied by copies of the relevant records, by which the initial entries in the books of the Operator have been made. In case the Operator is one of the Co-Lessees the allocation concerns the remaining Co-Lessees. The amounts received by the Operator from the Co-Lessees for covering the expenses of the Operator do not constitute gross revenues of the Operator for the purposes of this Article and for income tax purposes. In addition to the expenses which are allocated to each CoLessee as above, each Co-Lessee shall have the right to deduct expenses stipulated in paragraph 7 of this Article and carried out by the Co-Lessee itself. 14.3 Each Co-Lessee shall maintain books and records that fully reflect its transactions, each Exploration or Exploitation Area. 14.4 The amounts that are recorded as income and expenses in the accounts specified in the preceding paragraph, shall be determined in paragraphs 6, 7 and 8 of this Article. Specifically with regard to licenses that fall within the provisions of Hydrocarbons Law, up to fifty per cent (50%) of the expenses of Exploration Operations in the Contract Area may be included in the expenses of another contract area for which the Lessee or each Co-Lessee holds an exploitation licence according to the provisions of Hydrocarbons Law and has commenced the production of Hydrocarbons. Such an allocation of expenses is realized, in the case of each Co-Lessee, in accordance with its respective interest in the present Agreement as set out in Article 1.5. Both exploration operations expenditures and the related depreciations of this category are accounted for in separate accounts in the books of each Co-Lessee. Net taxable income shall be the difference between the amounts credited as income and the amounts debited as expenses, as such amounts are shown in the consolidated account for the entire Contract Area. 14.5 For the purposes of determining each Co-Lessee’s annual taxable income, the permissible depreciation level of: i) the value of the expenses incurred for Hydrocarbons Exploration and the Exploitation infrastructure and the remaining fixed assets, including expenses incurred prior to the Commercial Production Date, and ii) expenses of the first establishment in Greece recorded in the income and expenditure account in accordance with Article 14.7 is equal to seventy per cent (70%) of the value of the annually Produced and Saved Hydrocarbons and Byproducts. Any depreciation taking place in accordance with the above, may not exceed the expenses incurred for exploration and the acquisition value of the assets to be depreciated. The value of the annually Produced and Saved Hydrocarbons and By-Products is determined in accordance with article 16 of this Agreement. 14.6 The income and expenditure account of each Exploitation Area is credited with the following:

the value of the Hydrocarbons and their By-Products Produced and Saved and sold by the each Co-Lessee;

the value of Royalties paid In-Kind to the Lessor as per the provisions of Article 13;

the proceeds of the sale of assets to the extent that such proceeds exceed the acquisition value thereof and, in the case of fixed assets, to the extent that such proceeds exceed the value thereof not yet depreciated; and

any other income connected with the Petroleum Operations or, deriving from the transportation of Hydrocarbons or By-Products through the Lessee’s pipelines on insurance or other compensation. In the event that any of the above revenues are derived by the Operator in the name and on behalf of the Co-Lessees such revenues will be allocated to the Co-Lessees by application of Article 14.2. 14.7 The income and expenditure account of each Exploration or Exploitation Area is debited with the following:

the expenses that are incurred for the Petroleum Operations, including but not limited to, the exploitation infrastructure and the other fixed assets, the expenses incurred prior to the commencement of Hydrocarbons Exploitation, as well as the expenses of the first establishment in Greece, which are calculated in accordance with Article 14.5;

current production expenses, and particularly the expenses incurred for materials, supplies or energy used or consumed, salaries and related expenses and expenses incurred for services provided by third parties;

general expenses incurred in the country for the Co-Lessee’s operations under this Agreement, including specifically expenses for salaries, rental costs for fixed and movable assets and insurance premiums;

amounts for salaries of managers or employees of the Co-Lessee’s offices abroad and for general administrative expenses of such offices according to the services provided by them relating to the contractual operations. Such amounts shall not exceed a percentage of the corresponding expenses incurred in Greece, as determined by the Presidential Decree unless otherwise approved by the Lessor during a given Annual Work Programme and Budget.

amounts of interest on loans and other bank and/or financing charges incurred for the purpose of securing financing or enabling each Co-Lessee to obtain credit in any other manner for the performance of the operations under this Agreement, with the exception of Exploration Operations and the delineation of deposits. The following interest charges shall be excluded: 1) the amounts by which the interest paid exceeds a reasonable interest rate according to the arm’s length principle; 2) the amounts by which the revenues from the production of hydrocarbons are used to finance capital investments in fixed development assets during the Exploitation Stage;

amounts for bad debt provisions according to the provisions of the Income Tax Code as well as any compensation paid for damages caused to third parties; 7.the non-depreciated value of destroyed or abandoned assets; 8.any amount deposited in a special dedicated account held with one or more banks accumulated shall appear in a reserve account and, any amount not used shall be taxed upon the termination of Hydrocarbons Exploitation ; 9.any amount of the Royalty to be paid in cash or in kind, as determined in accordance with Article 13;

any other current expense or loss relating to the contractual operations, provided that such expense or loss shall be deductible from the gross income in accordance with the general income tax provisions; 14.8 Revenues and expenses that cannot be attributed exclusively to a specific Exploitation Area are apportioned between all of the Exploitation Areas of the Contract Area, as more particularly prescribed by the Presidential Decree. 14.9 The value of the Hydrocarbons and their By-Products is determined in accordance with Article 16. 14.10 Losses incurred in respect of a particular Exploitation Area prior to the commencement of any Hydrocarbons Exploitation shall be carried forward without any restrictions to such period. From the commencement of any Hydrocarbons Exploitation and thereafter, the general income tax provisions shall apply in relation to the carry forward of losses. 14.11 In the event of a suspension of Hydrocarbons Exploitation in accordance with Article 26, the suspension period shall not be taken into account for the purposes of calculating the time period for which the transfer right of taxable losses applies in accordance with the general income tax provisions. 14.12 The actions of: (i) the grant of Hydrocarbon Exploration and Exploitation rights to the Lessee in accordance with this Agreement,; (ii) the transfer of rights and obligations by each Co-Lessee pursuant to agreements concluded in accordance with paragraphs 4 to 8 of article 7 of the Hydrocarbons Law and Article 20; (iii) the sale of Hydrocarbons Produced and Saved by each Co-Lessee; (iv) the contracts entered into for the purpose of Petroleum Operations by the Lessee with contractors and by contractors with subcontractors; and (v) the lease, the granting or the acquisition in any other manner of the use of property in accordance with the provisions of this Agreement, shall be objectively exempt from any general or special, ordinary or extraordinary tax, duty, stamp-duty, dues, ordinary or extraordinary contribution and deduction and shall be generally exempted from any financial charge in favour of the State and any third party. With respect to VAT, the provisions of the VAT Code (Law 2859/2000), as in force, shall apply. The capital gains resulting from the first transfer by any Co-Lessee of its respective interest as set out in Article 1.5 pursuant to agreements concluded in accordance with paragraphs 4 to 8 of article 7 of the Hydrocarbons Law and Article 20 and that is effected during a period of six (6) person for the implementation of the operations under this Agreement against the proportion transferred. 14.13 The loan or credit agreements, if any, granted to each Co-Lessee by banks or financial institutions or legal entities of any nature foreign or domestic, in order for the Petroleum Operations to be performed, the interest accrued and its payment, as well as the payments (cash calls) paid by each Co-Lessee to the Operator shall be exempt from any general or special, ordinary or extraordinary tax, duty, stamp-duty, dues, ordinary or extraordinary contribution and deduction and shall be generally exempted from any financial charge in favour of the State and any third party, save for the contribution of Law 128/75. Interest accrued on the aforementioned loan and credit agreements are not exempt from income tax. With respect to VAT, the provisions of the VAT Code (Law 2859/2000), as in force, shall apply. 14.14 The above provisions shall apply notwithstanding the provisions of the Income Tax Code, as in force, only with respect to issues that are not addressed by this Article. 14.15 The Code on taxation of inheritance, donations, gifts inter vivos and lottery gains, as ratified by the first article of Law 2961/2001 (Official Government Gazette A’ 266) shall apply in the event that the conditions for its application are met. 15.1 The Lessee shall pay the following surface fees: 1.Fifty (50) Euros per square kilometre of the Contract Area annually during the Exploration Stage (First Phase); 2.One hundred (100) Euros per square kilometre of the Contract Area annually during the Exploration Stage (Second Phase); 3.Two hundred (200) Euros per square kilometre of the Contract Area annually during the Exploration Stage (Third Phase) and any extension thereof as provided for in Article 2.3;

In addition to fees paid in respect of paragraphs (a), (b) and (c) above, one thousand (1,000) Euros per square kilometre of the Exploitation Area annually during the Exploitation Stage. For the first Calendar Year from Effective Date, the surface fee set forth in paragraph (a) above shall be calculated pro-rata from the Effective Date through to December 31st of said Calendar Year, and shall be paid within thirty (30) calendar days of the Effective Date. For succeeding Calendar Years, the surface fees set forth in paragraphs (a), (b) and (c) above shall be paid in advance, thirty (30) calendar days before the beginning of each Calendar Year. For the Calendar Year in which the Exploitation Stage commences with regard to the Exploitation Area, the surface fee set forth in paragraph (d) above shall be calculated pro-rata from the date the Exploitation Stage commences through to December 31st of said Calendar Year. For succeeding Calendar Years the surface fees set forth in paragraph (d) above shall be paid in advance, thirty (30) calendar days before the beginning of each Calendar Year. Surface fees shall be calculated based on the surface of the Contract Area and, where applicable, of the Exploitation Areas held by the Lessee on the date of payment of said surface rentals. In the event of surface relinquishment during a Calendar Year or in the event of Force Majeure, the Lessee shall have no right to be reimbursed for any surface fees already paid. 15.2 The Lessee shall pay to the Lessor the following amounts as bonus: 1.Five hundred thousand Euros [500,000 Euros] as a signature bonus within sixty (60) calendar days after the Effective Date; production of Hydrocarbons Produced and Saved from the Contract Area first reaches 10 MMboe (ten million barrels of Crude Oil or oil equivalent); 4.One million and two hundred thousand Euros [1,200,000 Euros] after the cumulative production of Hydrocarbons Produced and Saved from the Contract Area first exceeds 15 MMboe (fifteen million barrels of Crude Oil or oil equivalent); 5.One million Euros [1,000,000 Euros] after the cumulative production of Hydrocarbons Produced and Saved from the Contract Area first exceeds 30 MMboe (thirty million barrels of Crude Oil or oil equivalent); Natural Gas shall be taken into account for purposes of determining the cumulative production of Hydrocarbons Produced and Saved from the Contract Area under Article 15.2 (b) to (e) and Article 15.3(c) by converting daily Natural Gas delivered into equivalent barrels of daily Crude Oil production in accordance with the following formula: MSCF x H x 0.167 = equivalent barrels of Crude Oil where MSCF = one thousand Standard Cubic Feet of Natural Gas. H = the number of million British Thermal Units (BTU’s per MSCF). Such payments shall be made within sixty (60) calendar days following the day that the respective cumulative production thresholds mentioned under each Article 15.2 (b) to (e) has been achieved. The surface fees and bonuses required under this Article shall not be included in the Cumulative Total Outflows for the purposes of calculating the Royalty under Article 13. 15.3 The Lessee shall contribute to the training and facilities support of the human resources of the Ministry of Environment and Energy/HHRM SA as mutually agreed by the Parties. For that purpose the Lessee shall spend the following amounts, or pay to the Lessor/HHRM the difference between such amounts and the training expenditures yearly incurred: 1.during the Exploration Stage, an amount of eighty thousand Euros [80,000 Euros] per Calendar Year.

from the date that the Lessee declares a Discovery to be commercially exploitable under Article 7.4, an amount of one hundred thousand Euros [100,000 Euros] per Calendar Year. 3.During the Exploitation Stage, an amount of one hundred and forty thousand Euros any deduction including, without limitation, any deduction by way of claim, counterclaim or set off. Taking into account the provisions of the Presidential Decree, the value of any Hydrocarbons Produced and Saved shall be determined as follows: 16.1 For Crude Oil 1.In the case of Arm’s Length Sales (as defined in Article 16.1 (h)) of Crude Oil by the Lessee to Independent Third Parties: the price shall be the price free on board at the place of loading in Greece, ("FOB Greece Point of Delivery") actually realised by the Lessee provided that the said price is real and reasonable. A price shall be considered reasonable if it does not unduly differ from the official selling price, as fixed from time to time by the major crude oil exporting countries for Crude Oil closest in quality to that Hydrocarbons Produced and Saved and sold by the Lessee, after adjustment of such price to allow for variations in specific gravity, sulphur content, volumes, transportation costs and terms of sale (the "Official Price"). In the event of Cost Insurance Freight (CIF) sales appropriate deductions shall be made for applicable insurance and freight charges to calculate the FOB Greece Point of Delivery price. 2. (i) In the case of sales by the Lessee to Affiliate Enterprises and in the case of quantities retained by the Lessee for its own refining or use, and for any Crude Oil received in kind by the Lessor: the average weighted price, free on board (FOB) at the place of loading, in each Calendar Quarter, as established by Arm’s Length Sales of similar types of Crude Oil effected during such quarter from the Hydrocarbons Produced and Saved from the Contract Area by the Lessee to Independent Third Parties and by the Lessor to third parties (ii) If, during any Calendar Quarter, no Arm’s Length Sales of any type of Crude Oil have been made by the Lessee to Independent Third Parties, nor by the Lessor to third parties, other than to legal entities, directly or indirectly controlled by the State : the price shall be the Official Price.

In the event that, for the purposes of paragraphs (a) and (b) of this Article 16.1 the Parties cannot ascertain the Official Price of the Crude Oil Produced and Saved and sold then the price shall be as determined in accordance with paragraph (e) of this Article 16.1 for Crude Oil which, at the time of calculation, is being freely and actively traded in the international market and has similar characteristics (such as, by way of example only, specific gravity and sulphur content) to the Crude Oil in respect of which the price is being determined (the "Marker Crude"). The FOB selling price for the Marker Crude shall be ascertained from Platts Crude Oil Market Wire daily publication ("Platts"). 4.In the event the Parties fail to agree upon the identity of the Marker Crude, Article arithmetic average of the low and high price per barrel of the Marker Crude during the preceding seven (7) consecutive days high and low FOB prices for each day, as published by Platts, of the Marker Crude after adjustment of such prices to allow for variations in quality, transportation costs, delivery time, payment terms, the market area in which the Crude Oil is being sold, the prices available within the domestic market, product yield, seasonal variation in price and demand, market trends, other contract terms to the extent known and other relevant factors. Where the calculation for the average price includes a weekend or a day upon which Platts is not published, then the last published price shall be applied for the day or days upon which Platts is not available.

The FOB prices referred to in paragraph (e) of this Article 16.1 shall not include official sales prices set by governmental authorities or other prices established in government transactions, exchanges, barter, spot sales, restricted or distress transactions, any other transactions which are associated with special financial or commercial considerations or other dispositions not consistent with prevailing market prices for similar Crude Oil.

In the event that Platts ceases to be published for a period of thirty (30) consecutive Business Days, the Parties shall agree on an alternative daily publication of similar nature and stature used in the international petroleum industry. If the Parties cannot agree on the identity of an alternative daily publication as aforesaid, Article

For the purposes of this Article 16.1, the expression “Arm’s Length Sales” means sales entered into between a willing seller and a willing purchaser on commercial terms reflecting current open market conditions and excludes exchanges, barter, restricted or distress transactions or any other transaction which is associated with special financial or commercial considerations. 16.2 For Natural Gas, Condensates and other Hydrocarbons and By-Products (other than Crude Oil)

In the case of Hydrocarbons, other than Crude Oil, and By-Products, sold by the Lessee, the price shall be the actual selling price realised by the Lessee provided that the said price is real and reasonable. A price shall be considered reasonable if it takes account of prices current from time to time on the international market, the particular characteristics of the product, and the price of alternative fuels in the place to which the gas is delivered.