'Confidential D 107 86/5-I Eastern and General Syndicate Ltd. - Saudi Arabia' [‎79v] (163/386)

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Article 10.
As soon as it becomes possible (i.e .,the Company will be allowed a reasonable
im ± Vi5 orc , e ] rin ^ additional tools and for their shipment to Saudi Arabia to
mee the additional work after the date of discovering oil in commercial
quantities) the Company should continue digging, by means of two digging
machines, till it completes digging all over the fixed zone, in conformity with
the practice observed in first-class oil-fields, or until this agreement expires.
Article 11.
- Ilt J, h f Company shall pay to the Government royalty on all crude oil drawn
out oi stored, and which runs or flows from the field storage, after deducting—
First: Water and other foreign substances.
'^“within Sa"«A r W abSa be req “ ired by the for its OTdinar y work
I h^d: Oil which will be required for the purpose of manufacturing
quantities of benzine and kerosene, which will be supplied free to the ^
Government every year in pursuance of article 16 of this agreement.
The amount of royalty on each ton net weight of crude oil will be (a) 4s. gold or
s equivalent, or (b) in accordance with the choice which the Company may make
at the time of payment of each instalment, 1 American dollar on each toTof
ciude oil plus the difference in the rate of exchange in accordance with the
average of the rates of exchange for the three months before the payment of the
IlniSrSL t0r inStanCe p lf the av frage rate of exchange is 1 dollar or 14 cents
United States currency for each 4s. gold (i.e., that the value of £1 gold has
become equivalent to 5 do ars and 70 cents), the amount of royalty on ?ach ton
net weight of crude oil will then be 1 dollar and 4 cents.
Article 12.
nav tRo Company extracts, stores and sells any kind of mineral oil, it should
Ss ^ZZT 61 ! 1 * r T tj equivalent to one-eighth of the revenue from
Jorp anH Ti h is understood that the Company is not bound to extract,
bound" to nav anv mm f ,a . 01 ’ anc * it is also understood that the Company is not
bound to pay any royalty in respect of the oil which will be used by the Company
Kingdom ^ ^ maChineS and ° ther establ ^ments in t^e SaudiTJ
Article 13.
on their ShaTf 1 ^ 11 ^ ilave . tbe n ° ht ’ through representatives properly authorised
Comnanv b 1n a f> to , mspect ^ ur , m g working hours the work carried^ out by the
quantities producId^Tbl'r the P r0v } S10 ™ , of this agreement, and to check the
of mianHt^ nr^' Ihe , Com P an y s] ]ould keep correct accounts and measures
field In 1 ann a g ai .^ d and stored and which run from the depot of the
field, in accordance with the practice observed in the first-class oil-fields,
'oveinment representatives who are properly authorised have the right to check
IsTom TZl t a \ C °rr nt , tlme J After the ^Pi^tion of oS hSf-yS
as from the date on which the oil is discovered in commercial quantities the
of°Xee y monS mF' 1 t0 X Government a half-yearly account within a period
Of three months following the said half-year, and submit a statement showing
° f r °y alty due t0 the Government for that half-year. The Goverm
S tores wtdeh e accounts and statements as confidential with the exception
of figures which the Government may find it necessary to publish for certain
financial purposes. The royalty which will be due to‘ the Government should
be paid at the end of each half-year, as from the date on which oil is discovered
Hi , c f m . n j l i ercial quantities, and such payment should be made within the period
of the three months following that half-year. In the case of any dispute which
m ft y occur in respect of the amount of royalty due for a half-year, the Company
should hand over to the Government within the fixed period that part of the
royalty which is not m dispute. The dispute which may arise tetwSi the two
paities should be settled by them, and if they do not come to a settlement in this
way, then such dispute may be settled by means of arbitration pro toed for in
this agreement. Any amount which will be decided after this settlement should
decision is 0 g toi 1 G0Vernment “ S1Xty dayS ’ aS from the date on w hich the
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