ENGLISH FOR THE OIL AND GAS INDUSTRIES

MAZINGIRA OIL
Negotiation
Following extensive testing, Mac la! Oil "as anno#nce$ t"e $iscove%& o' oil %ese%ves on t"e islan$ o' Ma(ingi%a) Mac la! "a$ o*taine$ +e%!ission to esta*lis" a test $%ill on Ma(ingi%a 'ollowing a s"o%t $isc#ssion wit" t"e 'o%!e% ,%esi$ent, w"o was $e+ose$ in a co#+ 'ive &ea%s ago) T"e te%!s o' t"e ex+lo%ato%& test we%e neve% 'o%!all& ag%ee$ an$ t"e w%itten $oc#!entation, i' it existe$, "as *een lost) It is esti!ate$ t"at t"e total %ese%ves at t"e c#%%ent +%ice o' oil o' -.// a *a%%el will a!o#nt to a++%oxi!atel& at least -. *illion ove% t"e next 0/ &ea%s) A'te% a lavis" +a%t& at t"e ,%esi$ent1s +alace to cele*%ate t"e $iscove%&, tal2s "ave *een convene$ *etween t"e Di%ecto%s o' Mac la! an$ t"e Minist%& o' Econo!ic Develo+!ent) #%%entl&, Ma(ingi%a1s GD, +e% ca+ita is a%o#n$ -./,///) Most o' t"e +o+#lation o' Ma(ingi%a1s +o+#lation o' .3/,/// live in Ta*asco 4see !a+5) T"e +%inci+le in$#st%& is t"e "a%vesting o' t"e *a%2 '%o! t%ees onl& 'o#n$ on t"e islan$) T"is *a%2 is #se$ *& t"e +"a%!ace#tical in$#st%&) It +%ovi$es t"e !a6o% cont%i*#tion to t"e co#nt%&1s ann#al G%oss Do!estic ,%o$#ct o' -./ *illion) Ma(ingi%a "as so!e ca+ital %eso#%ces, an$ wo#l$ nee$ Ma la! to +%ovi$e !ost o' t"e sta%t #+ ca+ital to ex+loit t"e %eso#%ces) Howeve%, t"e ,%esi$ent wants to ens#%e t"at t"e new $iscove%& will envi%on!ental stan$a%$s an$ wa& o' li'e o' "is co#nt%&) %es+ect t"e

Negotiation7 Mac la! an$ t"e Ma(ingi%an gove%n!ent "ave ag%ee$ to "ol$ tal2s to $isc#ss t"e 'ollowing "ea$s o' ag%ee!ent wit" a view to ag%eeing a 8oint 9ent#%e to ex+loit t"e oil an$ gas %ese%ves) .) Na!e 'o% t"e new 8oint 9ent#%e 0) Initial Invest!ent:,a&!ent 'o% t"e oncession to Ex+loit t"e Rese%ves ;) E<#it& +a%tici+ation in 8oint 9ent#%e 3) A%*it%ation : D#%ation o' 8oint 9ent#%e =) Envi%on!ental I!+act:E!+lo&!ent

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ENGLISH FOR THE OIL AND GAS INDUSTRIES

Ma(ingi%a
Mo6a$a (Pop 30,000)

Rive% Ta*asco

Ta*asco (Pop 100,000)

Ai%+o%t

10km

farmland village

road dock

town rainforest

mountain

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ENGLISH FOR THE OIL AND GAS INDUSTRIES

Mac la! > EO

?o# a%e an ex+e%ience$ Oil an$ Gas o!+an& *ase$ in A*e%$een, Scotlan$) Un'o%t#natel&, &o#% c"ai%!an Si% E%nest Mac la! is #nwell, *#t &o# "ave "is '#ll a#t"o%it& to %eac" a *in$ing ag%ee!ent to$a&) ?o#% !ain oil wells a%e in t"e No%t" Sea, *#t &o# "ave "a$ s#ccess'#l ex+lo%ations in Senegal an$ New G#inea) ?o# a%e +lease$ at t"e $iscove%& o' t"e oil an$ gas in Ma(ingi%a) In 'act &o#% enginee%s "ave *een tol$ t"at t"e +otential %ese%ves a%e !#c" la%ge% t"an state$, an$ t"e%e is a st%ong +ossi*ilit& o' o''s"o%e $iscove%ies) ?o# !a& c"oose to 2ee+ t"is con'i$ential o% to *e as t%ans+a%ent as +ossi*le) T"e %ig"t to ex+lo%e was ag%ee$ $#%ing a %#g*& to#%na!ent, w"e%e &o#% "ai%!an, Si% E%nest Mac la!, !et ,%esi$ent To*a2o, t"e 'o%!e% lea$e% at a $inne%) An #no''icial +olitical cont%i*#tion o' seve%al !illion $olla%s was +ai$ to t"e Swiss acco#nt o' t"e ,%esi$ent in %et#%n 'o% t"e %ig"t to con$#ct t"e ex+lo%ato%& tests) No 'o%!al $oc#!ents we%e eve% $%a'te$) Negotiating *%ie'7 S#ggest a nice na!e 'o% t"e new 89) Listen to t"ei% s#ggestion an$ ag%ee on a na!e toget"e%) Ma2e s#%e t"is is not a $eal *%ea2e%) ?o# "ave s+ent -./ !illion on t"e tests, incl#$ing t"e coo+e%ation o' t"e 'o%!e% ,%esi$ent) T"e cost o' t"e new well is +%o6ecte$ to *e7 onst%#ction:Installation o' new +lat'o%!7 -./ !illion onst%#ction o' in'%ast%#ct#%e7 -= !illion) Deci$e "ow !#c" o' t"is Mac la! is willing to +a&) oncession Rig"ts7 ?o# a%e willing to +a& #+ to -0/ !illion in a l#!+ s#! to t"e Ma(ingi%an gove%n!ent 'o% t"e excl#sive %ig"ts to $%ill on Ma(ingi%a) E<#it& ,a%tici+ation7 ?o# wo#l$ li2e t"e 89 to *e on a =/:=/ *asis, wit" Si% E%nest Mac la! "aving a casting vote at s"a%e"ol$e%s1 !eetings) Net +%o'its wo#l$ *e s"a%e$ on t"e sa!e *asis) A%*it%ation7 ?o# a%e willing 'o% new $is+#tes to settle$ *& t"e Inte%national "a!*e% o' o!!e%ce a%*it%ation se%vice) D#%ation7 ?o# ex+ect t"at t"e 89 will *e on an o+en en$e$ *asis s#*6ect to te%!ination onl& *& ag%ee!ent o' *ot" +a%ties) Envi%on!ental I!+act:E!+lo&!ent7 T"e well will %e<#i%e t"e $e'o%estation o' so!e ./@ o' Ma(ingi%an %ain 'o%est) An& a$$itional $a!age will *e allowe$ onl& a'te% cons#ltation wit" t"e ,%esi$ent) ?o# a%e willing to t%ain .// Ma(ingi%an enginee%s at &o#% "ea$<#a%te%s in A*e%$een) Initiall&, t"e o+e%ational sta'' will "ave to *e +%ovi$e$ *& Mac la!)

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ENGLISH FOR THE OIL AND GAS INDUSTRIES

Ministe% o' Econo!ic Develo+!ent o' Ma(ingi%a

?o# "ave %ecentl& *een a++ointe$ *& t"e new +%esi$ent, M% Rasa+e2a, w"o was electe$ on a +o+#la% !an$ate to Aclean #+ Ma(ingi%a1) It is wi$el& s#s+ecte$ "at t"e 'o%!e% ,%esi$ent To*a2o was co%%#+t) ?o# want to ens#%e t"at Ma(ingi%a *ene'its as !#c" as +ossi*le '%o! t"is $iscove%&) At t"e !o!ent Ma(ingi%a "as no oil in'%ast%#ct#%e o% %elations"i+ wit" an& o' t"e oil co!+anies ot"e% t"an Mac la!) Howeve%, &o# wo#l$ li2e to 2ee+ o+en t"e o+tion o' a $eal wit" ot"e% co!+anies) It is not 2nown "ow Mac la! ca!e to *e involve$ in Ma(ingi%a, o% t"e te%!s on w"ic" t"e ex+lo%ato%& tests we%e !a$e) D#%ing t"e co#+, w"ic" le$ to t"e election o' M% Rasa+e2a, !an& state +a+e%s we%e $est%o&e$ in a 'i%e at t"e gove%n!ent +alace) Negotiating B%ie'7 Celco!e &o#% g#ests to Ma(ingi%a) As2 a*o#t Si% E%nest Mac la!) As2 'o% $etails o' t"e ex+lo%ato%& tests7 How !#c" $i$ t"e& cost, w"at $i$ t"e& s"owD Na!e7 S#ggest a na!e 'o% t"e 89) T"is s"o#l$ "ave so!e association wit" t"e islan$ to s"ow t"at it is &o#% oil) oncession Rig"ts7 ?o# %e<#i%e an initial +a&!ent o' -.//,/// to g%ant Mac la! excl#sive %ig"ts) Howeve%, &o# co#l$ lowe% t"is a!o#nt i' Ma(ingi%a %e!ains '%ee to tal2 to ot"e% oil co!+anies) E<#it& ,a%tici+ation7 ?o# wo#l$ li2e Ma(ingi%a to cont%ol E=@ o' t"e E<#it&) Howeve% &o# co#l$ %e$#ce t"is to =/@ i' &o#% ,%esi$ent o% an in$e+en$ent t"i%$ +a%t& we%e to %etain a casting vote) Net +%o'its wo#l$ *e $ivi$e$ on t"is *asis) A%*it%ation7 ?o# a%e willing 'o% new $is+#tes to settle$ *& t"e Inte%national "a!*e% o' o!!e%ce a%*it%ation se%vice D#%ation7 ?o# wo#l$ li2e a *%ea2 cla#se in t"e 89 ag%ee!ent, w"ic" wo#l$ allow eit"e% +a%t& to te%!inate t"e 89 eve%& = &ea%s) Envi%on!ental I!+act:E!+lo&!ent7 ?o# want to ens#%e t"e +%otection o' t"e %ain'o%est o' Ma(ingi%a, w"ic" is an integ%al +a%t o' &o#% "e%itage, an$ w"ic" &o# will nee$ to s#stain t"e *a%2 on w"ic" t"e long te%! '#t#%e o' t"e co#nt%& $e+en$s) Howeve%, &o# %ecognise t"at t"at t"e installation will involve so!e $a!age) T%& to +#t a li!it on t"e $e'o%estation) ?o# wo#l$ li2e t"e oil in$#st%& to e!+lo& as !an& Ma(ingi%ans as +ossi*le)

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ENGLISH FOR THE OIL AND GAS INDUSTRIES

New +a%tne%s"i+ in G#ineaFs oil an$ gas concession a'%ol News, .G Octo*e% - Hyperdynamics Corporation as today announced it as signed a letter of intent wit !"erdeen-"ased #ana Petroleum P$C under w ic t e two companies will negotiate t e assignment of a %3 percent participating interest in t e oil and gas concession offs ore t e &epu"lic of 'uinea( !ccording to t e company, t e letter of intent, w ic is non-"inding and gives #ana e)clusive negotiating rig ts for t e %3 percent s are, calls for #ana to take a participating interest in Hyperdynamics* concession in e)c ange for total consideration of +%0 million( , is includes +- million in cas paya"le upon e)ecution of t e definitive agreements and, w ere applica"le, t eir entry into full legal effect pursuant to t e laws of 'uinea, t e company e)lained, adding t at t e remaining +1- million is paya"le at #ana*s option in eit er cas or newly issued ordinary s ares of #ana( ./t would "e paid upon t e conclusion "y 0arc %010 of a review "y t e government of 'uinea and Hyperdynamics of its %001 Production 2 aring Contract pursuant to t e terms of a 0emorandum of 3nderstanding signed in 2eptem"er and t e effectiveness of any resulting revisions or amendments( , ere would "e no restriction on t e immediate resale of t ese s ares "y Hyperdynamics,. e)plained t e company statement( !ccording to t e statement, t e two companies intend to seal t e deal no later t an 31 #ecem"er, %004, w en t e letter of intent would terminate unless e)tended "y furt er agreement( #ana also as t e option to negotiate wit Hyperdynamics to take up to an additional %5 percent of t e concession, wit consideration to "e separately negotiated, if Hyperdynamics does not sign a letter of intent for a participating interest wit an additional e)ploration and production company wit t e financial and tec nical capa"ility to operate in deep water off t e coast of 6est !frica "y 30 7ovem"er, %004( .6it a strong record of successful e)ploration and production activities in t e 7ort 2ea and ongoing e)ploration in 6est !frica in 0auritania and 2enegal, #ana is t e kind of partner Hyperdynamics as "een seeking to supply additional tec nical e)pertise and elp us accelerate e)ploration of our offs ore 'uinea concession,. said &ay $eonard, Hyperdynamics* President and C ief 8)ecutive 9fficer( .6e intend to "egin a new %-# seismic survey at t e end of t is mont , and we look forward to working in partners ip wit #ana to elp us evaluate t e results of t e new data and select w ic portions of our 31,000-s:uare-mile contract area to retain for future e)ploration under our Production 2 aring Contract and t e more recent 0emorandum of 3nderstanding wit t e government of 'uinea,. 0r $eonard said(

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ENGLISH FOR THE OIL AND GAS INDUSTRIES

;ased in !"erdeen, 2cotland, #ana as "ot production and e)ploration operations in t e 7ort 2ea and 8gypt, as well as additional e)ploration activities offs ore 0auritania, 0orocco and 2enegal( #ana reported t at last year it produced more t an 34,000 "arrels of oil e:uivalent per day and ad proved and pro"a"le reserves of 14< million "arrels of oil e:uivalent at year-end %00=( New +a%tne%s"i+ in G#ineaFs oil an$ gas concession Please insert the following words into the gaps. ex+e%tise %e!aining a$$itional %eco%$ s#%ve& o''s"o%e +a%tici+ating %etain lette% o' intent nonH*in$ing o+tion concession exec#tion laws %evisions %esale ongoing seal *ase$
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ENGLISH FOR THE OIL AND GAS INDUSTRIES

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ENGLISH FOR THE OIL AND GAS INDUSTRIES

New +a%tne%s"i+ in G#ineaFs oil an$ gas concession Hyperdynamics Corporation as today announced it as signed a >>>>>>>>>>>>>>>>>>>>> wit !"erdeen-"ased #ana Petroleum P$C under w ic t e two companies will negotiate t e assignment of a %3 percent >>>>>>>>>>> interest in t e oil and gas concession >>>>>>>>>>>>>>>>>>> in t e &epu"lic of 'uinea( !ccording to t e company, t e letter of intent, w ic is >>>>>>>>>>>>>>>> and gives #ana e)clusive negotiating rig ts for t e %3 percent s are, calls for #ana to take a participating interest in Hyperdynamics* >>>>>>>>>>> in e)c ange for total consideration of +%0 million( , is includes +- million in cas paya"le upon >>>>>>>>>>>>>>> of t e definitive agreements and, w ere applica"le, t eir entry into full legal effect pursuant to t e >>>>>>>>>> of 'uinea, t e company e)lained, adding t at t e >>>>>>>>>>>>> +1million is paya"le at #ana*s option in eit er cas or newly issued ordinary s ares of #ana( ./t would "e paid upon t e conclusion "y 0arc %010 of a review "y t e government of 'uinea and Hyperdynamics of its %001 Production 2 aring Contract pursuant to t e terms of a 0emorandum of 3nderstanding signed in 2eptem"er and t e effectiveness of any resulting >>>>>>>>>>> or amendments( , ere would "e no restriction on t e immediate >>>>>>>>>>> of t ese s ares "y Hyperdynamics,. e)plained t e company statement( !ccording to t e statement, t e two companies intend to >>>>>>>>> t e deal no later t an 31 #ecem"er, %004, w en t e letter of intent would terminate unless e)tended "y furt er agreement( #ana also as t e >>>>>>>>> to negotiate wit Hyperdynamics to take up to an additional %5 percent of t e concession, wit consideration to "e separately negotiated, if Hyperdynamics does not sign a letter of intent for a participating interest wit an >>>>>>>>> e)ploration and production company wit t e financial and tec nical capa"ility to operate in deep water off t e coast of 6est !frica "y 30 7ovem"er, %004( .6it a strong >>>>>>>>>>>> of successful e)ploration and production activities in t e 7ort 2ea and >>>>>>>>>>> e)ploration in 6est !frica in 0auritania and 2enegal, #ana is t e kind of partner Hyperdynamics as "een seeking to supply additional tec nical >>>>>>>>>>>> and elp us accelerate e)ploration of our offs ore 'uinea concession,. said &ay $eonard, Hyperdynamics* President and C ief 8)ecutive 9fficer( .6e intend to "egin a new %-# seismic >>>>>>>>>>>> at t e end of t is mont , and we look forward to working in partners ip wit #ana to elp us evaluate t e results of t e new data and select w ic portions of our 31,000-s:uare-mile contract area to >>>>>>>>>>> for future e)ploration under our Production 2 aring Contract and
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ENGLISH FOR THE OIL AND GAS INDUSTRIES

t e more recent 0emorandum of 3nderstanding wit t e government of 'uinea,. 0r $eonard said( >>>>>>>>> in !"erdeen, 2cotland, #ana as "ot production and e)ploration operations in t e 7ort 2ea and 8gypt, as well as additional e)ploration activities offs ore 0auritania, 0orocco and 2enegal( #ana reported t at last year it produced more t an 34,000 "arrels of oil e:uivalent per day and ad proved and pro"a"le reserves of 14< million "arrels of oil e:uivalent at year-end %00=(

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