Sie sind auf Seite 1von 95

CONTRACT FORM

TENDER DOCUMENTS

TENDER NO. CHO/2013/DPG/0003

PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

FOR

PETRONAS CARIGALI SDN BHD

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

TABLE OF CONTENT

ARTICLES

TITLE

PAGE NO.

PREAMBLE

SIGNATORIES

1. TENDER DOCUMENTS

 

7

2. DEFINITIONS AND INTERPRETATIONS

 

9

3. RESPONSIBILITY OF CONTRACTOR TO INFORM ITSELF

15

4. RESPONSIBILITY

OF

CONTRACTOR

TO

INFORM

16

COMPANY

5. CONTRACT DURATION

 

17

6. CONTRACT PRICE

18

7. INVOICING AND PAYMENTS

 

19

8. TAXES, CUSTOM CHARGES AND GOODS & SERVICES TAX

21

9. PERFORMANCE GUARANTEES

 

26

10. WARRANTY AND REPRESENTATIONS

28

11. OBLIGATIONS OF PARTIES

 

30

12. ACTIONS ON BEHALF OF COMPANY

 

37

13. REPRESENTATIVES OF THE PARTIES

38

14. LIENS AND CLAIMS

39

15. HEALTH, SAFETY AND ENVIRONMENT REQUIREMENTS

40

16. ACCEPTANCE OF SCOPE OF WORKS

 

45

17. DEFAULT OF CONTRACTOR

48

18. LIABILITIES AND INDEMNITIES

50

19. INSURANCES

52

20. SUSPENSION OF SCOPE OF WORKS

 

56

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

21. TERMINATION

57

22. AUDIT

60

23. CHANGES

61

24. FORCE MAJEURE

63

25. CONFLICT OF INTEREST

64

26. INTELLECTUAL PROPERTY RIGHTS

65

27. WAIVERS

67

28. CONFIDENTIALITY

68

29. ARBITRATION

69

30. GOVERNING LAWS AND LANGUAGE

70

31. ENTIRE AGREEMENT

71

32. NON-EXCLUSIVE AGREEMENT

72

33. SUB-CONTRACTING AND ASSIGNMENT

73

34. PROCUREMENT OF EQUIPMENT, FACILITIES, GOODS, MATERIALS, SUPPLIES AND SERVICES

75

35. NOTICES

77

36. SURVIVAL

78

37. SEVERABILITY

79

38. LIQUIDATED DAMAGES

80

39. CONTRACT CLOSURE

82

40. TRANSFER OF TITLE AND RISK OF LOSS

83

41. ENGINEERING CODES AND STANDARDS

84

42. VENDOR DATA REQUIREMENTS AND SUBMITTAL

85

43. EXPEDITING

86

44. INSPECTION

87

45. TRAINING

89

46. ANTI CORRUPTION

90

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

47 BUSSINESS CONDUCT

91

48 CONFLICT OF INTEREST AND FIGHTING CORRUPTION AND UNETHICAL PRACTICES

92

49 PRESERVATION AND MAINTENANCE

93

EXHIBITS

EXHIBIT I

SCOPE OF WORKS

 

EXHIBIT II

SCHEDULE OF WORKS

EXHIBIT III

SCHEDULE OF COMPENSATION

EXHIBIT IV

ADMINISTRATIVE PROCEDURES

EXHIBIT V

CONTRACTOR‟S ORGANIZATION AND PROJECT TEAM KEY PERSONNEL

EXHIBIT VI

LIST OF SUB-CONTRACTORS AND VENDORS

 

EXHIBIT VII

COMPANY AND CONTRACTOR SUPPLIED MATERIALS AND EQUIPMENT

EXHIBIT VIII

QUALITY ASSURANCE PROGRAMME REQUIREMENTS

 

EXHIBIT IX

HEALTH, SAFETY & ENVIRONMENT (HSE) REQUIREMENTS

EXHIBIT X

LIST

OF

SPECIFICATIONS,

CODES,

STANDARDS

AND

PROCEDURES

 

EXHIBIT XI

LIST OF TECHNICAL DOCUMENT AND DRAWINGS

 

EXHIBIT XII

PERFORMANCE GUARANTEE

 

EXHIBIT XIII

REGULATORY REQUIREMENTS

EXHIBIT XIV

MARINE SPREAD REQUIREMENTS

 

EXHIBIT XV

LIST OF APPLICABLE CORRESPONDENCE

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

PREAMBLES

The CONTRACT is made and entered into this [

] day of [

between

], year of [

]

PETRONAS CARIGALI SDN. BHD. [Co. No. 39275-U] , a company incorporated in Malaysia under PANYmpanies Act 1965 and having its registered office at Tower 1, PETRONAS Twin Towers, Kuala Lumpur City Centre, 50088 Kuala Lumpur, Malaysia (hereinafter referred to as the "COMPANY") of the first part

and

[CONTRACTOR Company Name ], [Co. No] [Note: Please state the registered address of the bidder's company, the location of the country where was the bidder's company incorporated and under what act/ law was the bidder's company registered] (hereinafter referred to as the "CONTRACTOR") of the second part.

Hereinafter the parties of the first and second parts shall be referred to singularly as "PARTY" and collectively as "PARTIES".

Whereas:

1. COMPANY (as defined herunder), pursuant to the Production Sharing Contract entered into with PETRONAS is engaged and appointed as the operator for the exploration, development and production of hydrocarbons for oil and gas fields onshore/offshore Malaysia

2. COMPANY requires the Procurement and Construction of Bergading Pipeline Tie-in Skid as described in the exhibits attached hereto and made a part hereof and in accordance with the terms and conditions of this CONTRACT (hereafter referred to as WORKS).

3. CONTRACTOR represents that it possesses the necessary experience and capability with qualified and experienced personnel and sufficient facilities, premises and equipment as well as being financially able to do and perform the WORKS expeditiously to the satisfaction of COMPANY.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

SIGNATORIES

IN WITNESS WHEREOF, the PARTIES have caused this CONTRACT to be executed in duplicate originals in their respective corporate names by their respective officers, thereunder duly authorized, as of the date and year first above written.

COMPANY

For and on behalf of

PETRONAS CARIGALI SDN. BHD.

CONTRACTOR For and on behalf of (CONTRACTOR'S Name)

BHD. CONTRACTOR For and on behalf of (CONTRACTOR'S Name) Name : Name : Designation : Designation
BHD. CONTRACTOR For and on behalf of (CONTRACTOR'S Name) Name : Name : Designation : Designation
BHD. CONTRACTOR For and on behalf of (CONTRACTOR'S Name) Name : Name : Designation : Designation
BHD. CONTRACTOR For and on behalf of (CONTRACTOR'S Name) Name : Name : Designation : Designation
BHD. CONTRACTOR For and on behalf of (CONTRACTOR'S Name) Name : Name : Designation : Designation
BHD. CONTRACTOR For and on behalf of (CONTRACTOR'S Name) Name : Name : Designation : Designation
BHD. CONTRACTOR For and on behalf of (CONTRACTOR'S Name) Name : Name : Designation : Designation
BHD. CONTRACTOR For and on behalf of (CONTRACTOR'S Name) Name : Name : Designation : Designation
BHD. CONTRACTOR For and on behalf of (CONTRACTOR'S Name) Name : Name : Designation : Designation
BHD. CONTRACTOR For and on behalf of (CONTRACTOR'S Name) Name : Name : Designation : Designation
BHD. CONTRACTOR For and on behalf of (CONTRACTOR'S Name) Name : Name : Designation : Designation
BHD. CONTRACTOR For and on behalf of (CONTRACTOR'S Name) Name : Name : Designation : Designation
BHD. CONTRACTOR For and on behalf of (CONTRACTOR'S Name) Name : Name : Designation : Designation
BHD. CONTRACTOR For and on behalf of (CONTRACTOR'S Name) Name : Name : Designation : Designation
BHD. CONTRACTOR For and on behalf of (CONTRACTOR'S Name) Name : Name : Designation : Designation
BHD. CONTRACTOR For and on behalf of (CONTRACTOR'S Name) Name : Name : Designation : Designation
BHD. CONTRACTOR For and on behalf of (CONTRACTOR'S Name) Name : Name : Designation : Designation
BHD. CONTRACTOR For and on behalf of (CONTRACTOR'S Name) Name : Name : Designation : Designation
Name : Name : Designation : Designation : WITNESS WITNESS Name : Name : Designation
Name
:
Name
:
Designation
:
Designation
:
WITNESS
WITNESS
Name
:
Name
:
Designation
:
Designation
:

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

Now, therefore, for and in consideration of the mutual covenants and agreements set forth herein, the PARTIES hereto agree as follows:

ARTICLE 1 - CONTRACT DOCUMENTS

1.1 The following documents together constitute this CONTRACT.

ARTICLES 1 49 (inclusive)

EXHIBIT I

SCOPE OF WORKS

 

EXHIBIT II

SCHEDULE OF WORKS

EXHIBIT III

SCHEDULE OF COMPENSATION

EXHIBIT IV

ADMINISTRATIVE PROCEDURES

EXHIBIT V

CONTRACTOR‟S ORGANIZATION AND PROJECT TEAM KEY PERSONNEL

EXHIBIT VI

LIST OF SUB-CONTRACTORS AND VENDORS

 

EXHIBIT VII

COMPANY AND CONTRACTOR SUPPLIED MATERIALS AND EQUIPMENT

EXHIBIT VIII

QUALITY ASSURANCE PROGRAMME REQUIREMENTS

 

EXHIBIT IX

HEALTH, SAFETY & ENVIRONMENT (HSE) REQUIREMENTS

EXHIBIT X

LIST

OF

SPECIFICATIONS,

CODES,

STANDARDS

AND

PROCEDURES

 

EXHIBIT XI

LIST OF TECHNICAL DOCUMENT AND DRAWINGS

 

EXHIBIT XII

PERFORMANCE GUARANTEE

 

EXHIBIT XIII

REGULATORY REQUIREMENTS

1.2 In the event of any ambiguity, inconsistency or conflict between the articles and exhibits listed above, the articles shall take precedence and prevail over the exhibits.

1.3 In the event of any ambiguity, inconsistency or conflict between the provisions of the exhibits, COMPANY shall decide the order of prevalence amongst the exhibits.

1.4 All STANDARDS, codes, SPECIFICATIONS, DRAWINGS, instructions and other documents, which are referred to in the exhibits, shall be deemed incorporated herein by reference and made a part hereof.

1.5 None of the documents abovementioned shall be used by CONTRACTOR for any purpose other than this CONTRACT.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

1.6 Any reference or detail provided in any one of the above documents but not in others shall be taken as read in all documents in this CONTRACT.

1.7 Unless otherwise specified by COMPANY, any reference to time period shall be deemed to be based on calendar days.

1.8 Any review, APPROVAL, acknowledgement or certificate given by COMPANY shall not in any way operate to release or relieve CONTRACTOR from or limit in any way any of CONTRACTOR‟s duties, responsibilities, obligations or liabilities imposed upon him by or as a result of any of the provisions of the CONTRACT.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 2 - DEFINITIONS AND INTERPRETATIONS

2.1 The following definitions shall apply to this CONTRACT except where the context otherwise requires:

2.1.1 “AFFILIATES” means any company or other entity that directly or indirectly through one or more intermediary, controls or is controlled by or is under common control with a PARTY to this CONTRACT. "Control" in this context means ownership of more than fifty percent (50%) of the voting stock of the controlled company or the direct or indirect right to determine its actions by contract or otherwise.

2.1.2 “APPROVAL” or “APPROVED” means approval and/or approved in writing (where provided for under this CONTRACT) made by COMPANY.

2.1.3 CHANGE ORDERmeans a document to be issued by COMPANY which sets forth mutually agreed changes to this CONTRACT and the basis on which CONTRACTOR shall be compensated for the change, if applicable.

2.1.4 “COMMISSIONING” means the activity of testing and adjusting of equipment, subsystems or systems or FACILITIES which may comprise of operational testing under real conditions and completion of the performance / endurance test to ensure that the same fulfils its design or intended purpose and meets all applicable SPECIFICATIONS, codes, regulation and STANDARDS. After COMMISSIONING, the equipment or system or FACILITIES shall be ready for use and put in service by COMPANY.

2.1.5 “COMPANY” means PETRONAS CARIGALI SDN. BHD.

2.1.6 “COMPANY’s EQUIPMENT” means the equipment and other parts, spares and other materials provided by COMPANY, as specified in ARTICLE 11 - OBLIGATIONS OF PARTIES and EXHIBIT VII - COMPANY AND CONTRACTOR SUPPLIED MATERIALS AND EQUIPMENT.

2.1.7 “COMPANY’s SUPPLY BASE” means COMPANYs warehouse at Kemaman Supply Base, Terengganu and/or Asian Supply Base, Labuan or any other supply base as determined by COMPANY from time to time, which shall be the port of call for work boats and supply boats where supplies, materials and equipment required for COMPANY‟s offshore FACILITIES are assembled.

2.1.8 “CONTRACT CLOSURE CERTIFICATE” means a document, issued by CONTRACTOR within thirty (30) days from the end of the warranty period of the WORKS and prior to COMPANY‟S issuance of NOTICE OF FINAL ACCEPTANCE of the WORKS, or upon earlier termination, signifying that all of CONTRACTOR‟s employees, SUB-CONTRACTOR(s) and suppliers have been paid in full, for WORKS done or for equipment, materials, services and supplies furnished to and all debts, taxes, liens, privileges, claims, charges and obligations arising out of the purchase or lease of equipment, materials, supplies and labour for use in the WORKS hereunder to the date of such certificate in connection with the performance of the WORKS.

2.1.9 “CONTRACTOR’s EQUIPMENT” means the equipment and other parts, spares and other materials provided by CONTRACTOR, as specified in ARTICLE 11 - OBLIGATIONS OF PARTIES and EXHIBIT VII - COMPANY AND CONTRACTOR SUPPLIED MATERIALS AND EQUIPMENT.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

2.1.10 “CO-VENTURERS” means any Production Sharing Contractor having a legal interest in the operations of COMPANY.

2.1.11 “CONTRACT” means all articles, exhibits and any other documents attached hereto or incorporated by reference including any subsequent amendments to them.

2.1.12 CONTRACT

PRICE

means

the

agreed

amount

to

be

paid

to

CONTRACTOR

as

specified

in

EXHIBIT

III

SCHEDULE

OF

COMPENSATION.

2.1.13 CONTRACTORmeans the party entering into this CONTRACT with COMPANY for the performance of the WORKS or part thereof as set forth in this CONTRACT and includes CONTRACTOR‟s personnel, representatives, successors and authorized parties.

2.1.14 “CONTRACTOR REPRESENTATIVE” means the person appointed by CONTRACTOR to be in charge of the WORKS whom shall be APPROVED by COMPANY. CONTRACTOR REPRESENTATIVE shall have full authority to bind CONTRACTOR concerning the WORKS and every part thereof in conformity with this CONTRACT.

2.1.15 “CSP” means Carigali Standard Procedure

2.1.16 “DEMOBILISATION” means the departure of CONTRACTOR‟s personnel from WORK SITE to the POINT OF ORIGIN, upon completion of assignment or termination of WORKS. The personnel are considered as demobilised when they leave the WORK SITE and all charges will cease at this time unless otherwise stipulated.

2.1.17 “DRAWINGS” or “DOCUMENTATION” means sketches, drawings, reports, manuals, procedures and recommendations of any portion of the WORKS or part thereof.

2.1.18 “EFFECTIVE DATE” means [dd/mm/yyyy i.e. the date as specified in the

CONTRACT

Letter

of

Award],

as

further

specified

in

ARTICLE

5

-

DURATION.

2.1.19 “EQUIPMENT FAILURE STANDBY” means the time when CONTRACTOR is unable to continue with the WORKS as a result of equipment failure or when, in COMPANY‟s opinion, WORKS must be stopped due to unsafe working conditions of any equipment. However, EQUIPMENT FAILURE STANDBY shall not include circumstances when CONTRACTOR is not performing any WORKS or during period when WORKS are suspended.

2.1.20 “EXPERT” means an impartial and independent person or company mutually agreed upon by COMPANY and CONTRACTOR to give opinion in order to expedite settlement of any particular matter as described in ARTICLE 29 ARBITRATION.

2.1.21 “FACILITY” or “FACILITIES” means the structure, skid, pipelines, onshore facilities, other appurtenances and any items to be incorporated therein as described in EXHIBIT I SCOPE OF WORKS.

2.1.22 Not applicable

2.1.23 HALAL” means terms that may be used to indicate or may be understood as meaning to indicate as permissible to be consumed by Muslims and allowed in their religion for the referred to food to be consumed,

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

2.1.24 Not Applicable.

2.1.25 “INSPECTION AND TESTING” means those activities which are carried out by CONTRACTOR during construction or TESTING AND PRE- COMMISSIONING of the FACILITIES to prove and validate the correct and complete execution of the WORKS as further described in ARTICLE 45 INSPECTION and EXHIBIT I SCOPE OF WORKS.

2.1.26 “JOB CARD” means a document prepared by CONTRACTOR detailing the tasks, materials, manpower, tools, equipment, reference, drawing, procedure and HSE precautions required to complete the detailed ONSHORE and OFFSHORE TESTING AND COMMISSIONING of the WORKS.

2.1.27 SCHEDULED MECHANICAL COMPLETION DATE” means the Contractual date by which the Construction of the WORKS are completed, inspected, tested, pre-commissioned, commissioned as stipulated in EXHIBIT II SCHEDULE OF WORK.

“MECHANICAL COMPLETION DATE” means the actual date by which the Construction of the WORKS are successfully completed, inspected, tested, pre-commissioned, commissioned (for the selected non hydrocarbon system which has been agreed upfront with COMPANY) and preserved according to vendor‟s/manufacture‟s recommendation and up to COMPANY satisfaction and ready for load-out by CONTRACTOR.

2.1.28 “MECHANICAL COMPLETION DATE NOTICE” means a document to be issued by COMPANY signifying COMPANY‟s agreement that the fabrication of the WORKS are completed in accordance with the scheduled date as per EXHIBIT II SCHEDULE OF WORKS, subject to whatever qualifications that may be stated in the MECHANICAL COMPLETION DATE NOTICE.

2.1.29 MOBILISATION” means the arrival of CONTRACTOR‟s personnel for the commencement of the WORKS which is at the WORK SITE for onshore personnel and at the POINT OF EMBARKATION for offshore personnel. The personnel shall be considered mobilised when they report to the WORK SITE and/or POINT OF EMBARKATION as instructed by COMPANY and all charges shall commence therefrom.

2.1.30 “NEGLIGENCE” means any action or omission to do something, which a prudent and reasonable person, guided upon those considerations which ordinarily regulate the conduct of human affairs, would not do or do.

2.1.31 “NOTICE OF FINAL ACCEPTANCE” means a document to be issued by COMPANY within thirty (30) working days after completion of the warranty period of the WORKS and after all repairs, rectification, replacements and making good thereto have been carried out in accordance with the CONTRACT, and all requirements of this CONTRACT have been satisfactorily met.

2.1.32 “NOTICE OF PROVISIONAL ACCEPTANCE” means a document to be issued by COMPANY signifying COMPANY‟s conditional acceptance of the WORKS or part thereof and COMPANY‟s agreement that the WORKS have been installed and commissioned offshore; that all known deficiencies qualified in the MECHANICAL COMPLETION DATE NOTICE has been corrected or subject to whatsoever qualifications that may be stated in the NOTICE OF PROVISIONAL ACCEPTANCE and whereupon the warranty period shall commence.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

2.1.33 "PETRONAS" means Petroliam Nasional Berhad, the National Oil Company of Malaysia incorporated under the Petroleum Development Act 1974 and having its registered office at Tower 1, PETRONAS Twin Towers, Kuala Lumpur City Centre, 50088 Kuala Lumpur.

2.1.34 Not applicable

2.1.35 Not applicable.

2.1.36 “PROGRESS PAYMENT SCHEDULE” or “MILESTONE PAYMENT SCHEDULE” means the schedule set forth in Schedule B of EXHIBIT III - SCHEDULE OF COMPENSATION showing the progress of payment to CONTRACTOR of the lump sum component of the CONTRACT PRICE.

2.1.37 “PUNCHLIST” means incomplete, outstanding, and/or defective Scope of WORKS by CONTRACTOR identified near the end of any phase of the project, to be completed by CONTRACTOR and verified by COMPANY as per CONTRACT.

2.1.38 “PTS” PETRONAS Technical Standard

2.1.39 “SPECIFICATIONS” means the technical descriptions essential for the performance of the WORKS, as further detailed in EXHIBIT XI LIST OF TECHNICAL DOCUMENT AND DRAWINGS.

2.1.40 SAMAK” means the cleaning/washing process as according to Islamic method and specifically as mandatory procedure to be applied for the first time at galley, kitchen and food related utensils and ware. This cleaning method shall also be applied at all common amenities at WORKSITE or on barge i.e Muslim Prayer area etc.

2.1.41 “SUB-CONTRACT” means any contract between CONTRACTOR and any other third party or parties, as APPROVED in writing by COMPANY, for the performance of any part of the WORKS.

2.1.42 “SUB-CONTRACTOR” means any party or parties registered and licensed by PETRONAS, those has or have entered into a contract with CONTRACTOR, for the performance of any part of the WORKS.

2.1.43 Not applicable

2.1.44 “STANDARD” means any description (of a technical nature) of materials, engineering methods and techniques, equipment, fabrication or construction systems and methods, specifications, plans, workmanship or otherwise means of defining a result to be achieved or method to be followed.

2.1.45 “START-UP” is defined as integration of individual systems and introduction of hydrocarbon to the FACILITIES to initiate COMMISSIONING and Performance Test Run (PTR) of the FACILITIES. The activities include purging the system, leak checks, circulation of service fluids and the bringing of FACILITIES into production. The operating parameters shall be tuned and de-bottlenecked for optimum plant performance based on designed parameters.

2.1.46 “TESTING AND PRE-COMMISSIONING” means the activity of checking, verifying, testing, adjusting, aligning, calibrating, loop-testing, flushing of components, instrument assemblies, piping loops or systems to ensure that the function and operation of such is in accordance to the designed purpose and intended service and meets all applicable SPECIFICATIONS, regulations, codes and STANDARDS. Results of all applicable tests of the

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

above shall be recorded as stipulated in the prescribed Carigali Standard Procedure (CSP) forms and documents. On successful completion of the TESTING AND PRE-COMMISSIONING, the components, assembly, piping loops or systems shall be ready for START-UP and COMMISSIONING.

2.1.47 VENDORA third party that supplies equipment and/or material, and perform associated services to support the WORKS

2.1.48 Not applicable.

2.1.49 “WORKBOAT” means used for work purposes (as commercial fishing and ferrying supplies) which shall be self-propelled and include basic equipment, manpower, supervision, crews, consumable, and all other materials and services.

2.1.50 “WORKS CLOSURE CERTIFICATE” means a document issued by CONTRACTOR within thirty (30) days from the NOTICE OF PROVISIONAL ACCEPTANCE, stating items on outstanding claims and billings under the CONTRACT for COMPANY‟s APPROVAL. Such items shall include outstanding billing or payment on CONTRACT PRICE, CHANGE ORDER, reimbursable and other charges under the CONTRACT.

2.1.51 “WORKPACK” means a compilation of documents relating to a detailed work scope comprising JOB CARDs, procedures, schedule information, materials, resources, job safety analysis and handover and acceptance documents that require to be performed by CONTRACTOR prior to commencement of WORKS.

2.1.52 “WILFUL MISCONDUCT” / “GROSS NEGLIGENCE” means any action or failure to act )whether sole, jpint or concurrent) by any person that was intended to cause; or was in reckless disregard of or wanton indifference to, harmful consequences, which such person knew or should have known, such act or failure would have on the safety or property of another person or entity.

2.1.53 “WORKS” means all activities or services to be performed and rendered by CONTRACTOR or its SUB-CONTRACTOR(s), all equipment, materials and tools to be supplied and FACILITIES to be fabricated and completed as expressly set forth in the CONTRACT and all of CONTRACTOR‟s activities that are reasonably inferable from the description of the WORKS for the full and complete realisation of the structure or FACILITIES being or to be designed, procured, fabricated, and commissioned by CONTRACTOR. This shall include work or services performed pursuant to any authorisation for WORKS or changes which may be issued to CONTRACTOR from time to time in accordance with ARTICLE 23 - CHANGES which shall then become part of EXHIBIT I - SCOPE OF WORKS.

2.1.54 WORK SITE(s)means the areas either onshore or offshore as designated by COMPANY where the WORKS is to be performed, as further specified in EXHIBIT I SCOPE OF WORKS.

2.2

Interpretations

2.2.1 All headings, indexes, titles, subtitles, subheadings, words that are bold, italicized, capitalized or otherwise emphasized are for ease of reference only and such emphasis should not be taken into consideration in the interpretation or construction of this CONTRACT.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

2.2.2

Words importing the singular only also include the plural and vice versa where the context so requires.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 3 - RESPONSIBILITY OF CONTRACTOR TO INFORM ITSELF

3.1 CONTRACTOR shall be deemed to have:

(a)

Carefully read the CONTRACT documents to determine all the necessary services, labour, equipment and materials required for the performance of the WORKS;

(b)

Familiarised itself with the WORK SITE(s), any restrictions applicable to or associated with the WORK SITE(s) whether imposed by any authority or third party and all ingress and egress to or from it;

(c)

Obtained for itself in advance a full understanding and knowledge of the WORKS, the surrounding environment and the conditions under which the WORKS shall be carried out; and

(d)

Verified all data and information provided by COMPANY. COMPANY shall not be held responsible for any errors or omissions in such data or in any other information furnished or made available by COMPANY.

3.2 Any information that COMPANY decides to give to CONTRACTOR shall be information that is reasonably available to COMPANY at the material time. CONTRACTOR shall interpret and apply such received information for the performance of the WORKS.

3.3 No additional payment beyond what has been agreed in the CONTRACT shall be paid to CONTRACTOR due to CONTRACTOR‟s lack of understanding and knowledge of the WORKS which a reasonably prudent and experienced contractor should have determined and understood in advance, or due to CONTRACTOR‟s incorrect conclusions or misinterpretations of any data or information. CONTRACTOR shall not be relieved from any risk or obligation imposed under the CONTRACT on the ground that it did not or could not foresee any matter which may in fact affect or has affected the execution of the WORKS.

3.4 Any failure by CONTRACTOR to take account of matters, which may affect the WORKS, shall not relieve CONTRACTOR from its obligations under the CONTRACT.

3.5 In the event CONTRACTOR consists of a consortium or joint venture of two or more parties, then the liabilities of each consortium or joint venture parties shall be jointly and severally. Each Party shall be responsible only for its own obligations and liabilities as set forth herein.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 4 RESPONSIBILITY OF CONTRACTOR TO INFORM COMPANY

4.1 CONTRACTOR shall notify COMPANY without undue delay of all things that are or may appear to be:

(a)

In conflict with applicable law, including but not limited to PETRONAS‟ licensing requirements; or

(b)

Deficiencies,

omissions,

contradictions,

errors

or

ambiguities

in

the

CONTRACT.

4.2 Failure to notify COMPANY of deficiencies, omissions, contradictions, errors or ambiguities in the CONTRACT shall be deemed to be CONTRACTOR‟s confirmation that there are no deficiencies, omissions, contradictions, errors or ambiguities in the CONTRACT. However if COMPANY does receive such notice, COMPANY shall review these items and issue the necessary confirmations before CONTRACTOR proceeds with any part of the WORKS affected. CONTRACTOR shall not proceed with the WORKS prior to the receipt of such confirmations.

4.3 CONTRACTOR shall notify COMPANY immediately of any impending or actual stoppages of the WORKS, industrial disputes or other matters affecting or likely to affect the performance of the WORKS.

4.4 CONTRACTOR shall keep COMPANY fully informed of the progress of the WORKS and shall comply with the reporting requirements as set out by COMPANY.

4.5 Without prejudice to the foregoing, CONTRACTOR shall request in a timely manner, any information or detailed DRAWINGS it reasonably requires from COMPANY for the performance of the WORKS and COMPANY shall use its reasonable endeavors to respond within a reasonable time to such request.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 5 CONTRACT DURATION

5.1 Subject to the termination provision provided under ARTICLE 21 TERMINATION, this CONTRACT shall take effect on the EFFECTIVE DATE and shall remain valid until all obligations by both PARTIES, as provided herein, have been completed, in accordance with the terms and conditions herein stated.

5.2 CONTRACTOR shall perform the WORKS within the stipulated time as prescribed in EXHIBIT II - SCHEDULE OF WORKS or any other period(s) as may be extended by COMPANY in accordance with the CONTRACT. Any extension of period to perform the WORKS herein shall not be valid and effective unless agreed by COMPANY in writing, except where such extension is requested by COMPANY.

5.3 Without prejudice to ARTICLE 38 LIQUIDATED DAMAGES and all other rights available to COMPANY under the CONTRACT, if COMPANY determines that the progress of the WORKS has been too slow to achieve target completion of WORKS within the prescribed schedule referred to in the EXHIBIT II - SCHEDULE OF WORKS or any other period(s) as may be extended and APPROVED by COMPANY in accordance with Article 5.2 of the CONTRACT, CONTRACTOR shall expedite the progress of the WORKS such as by, but not necessary limited to, having additional shifts, working overtime and supplying additional manpower and equipment. All direct and incidental costs incurred by CONTRACTOR for expediting the WORKS hereunder shall be borne solely by CONTRACTOR.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 6 CONTRACT PRICE

6.1 The consideration for performance of the WORKS shall be as stated in EXHIBIT III SCHEDULE OF COMPENSATION. The compensation may be adjusted, subject to ARTICLE 23 CHANGES. The prices/rates shall remain firm and valid throughout the CONTRACT, and any extension periods thereto. Prices/rates shall not be subjected to change for any reason whatsoever including, but not limited to, cost escalation, currency fluctuations or minimum order size/tonnage.

6.2 The lump sums, fixed rates and any other prices quoted in this CONTRACT are based on the fiscal and other relevant legislation presently in force.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 7 INVOICING AND PAYMENTS

7.1 CONTRACTOR shall send the Service Confirmation through the Supplier Relationship Management (SRM) Supplier Self Service (SUS) portal to COMPANY for the WORKS performed upon the completion of the WORKS as specified in this CONTRACT for COMPANY REPRESENTATIVE‟s verification and APPROVAL before submission of the final undisputed e-Invoice (through the SRM SUS portal). The Service Confirmation may include any amount due to CONTRACTOR which has not been claimed previously, as well as any claims made by CONTRACTOR for expenditures on COMPANY's behalf.

7.2 Any claims made by CONTRACTOR for items reimbursable at actual cost under this CONTRACT or for payments made on COMPANY's behalf shall be properly itemized and shall be net of all discounts and allowances, whether or not taken by CONTRACTOR. Service Confirmation must be supported by the Job Completion Ticket (JCT) to fully support such reimbursement for verification thereof by COMPANY. JCT shall include all requisite supporting DOCUMENTATION such as time sheets, third party invoices and/or other supporting data or information as is required or reasonably necessary to support the claims, to be verified by COMPANY REPRESENTATIVE. The details of the process are illustrated in EXHIBIT IV - ADMINISTRATIVE PROCEDURES.

7.3 Upon verification, COMPANY may dispute and reject any Service Confirmations that do not fulfil COMPANY‟s verification requirements. COMPANY shall then notify CONTRACTOR to resubmit the corrected Service Confirmation together with the requisite DOCUMENTATION as per Article 7.2 herein above.

7.4 Should there be no further disputes, COMPANY shall perform Service Acceptance and CONTRACTOR shall then submit the e-Invoice via SUS portal.

7.5 Payments shall be made by the thirtieth (30th) day after receipt of the e-Invoice by COMPANY (date of receipt excluded). If the thirtieth (30th) day falls on Saturday, Sunday or a gazetted public holiday, the next working day shall be deemed to be the due date for payment.

7.6 Notwithstanding the above, COMPANY may withhold payments of the e-Invoice in the event that it is of the opinion that further verifications are required.

7.7 Payments due to CONTRACTOR may be withheld by COMPANY on account of the following:

(a)

unsatisfactory performance of the CONTRACT;

 

(b)

the filing of claims against COMPANY caused by acts or omissions of CONTRACTOR or failure of CONTRACTOR;

(c)

failure

to

submit

the

Bank

Guarantee

(including

renewals)

and/or

the

Parental/Principal Guarantee;

 

(d)

failure to submit the copies of Insurance Policies; or

 

(e)

failure of CONTRACTOR to pay amounts when due for labour or goods used by CONTRACTOR in doing WORKS or amounts due to CONTRACTOR's SUB-CONTRACTOR(s) on the WORKS.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

7.8 If and when the cause(s) for withholding any such payment has/have been remedied by CONTRACTOR and satisfactory evidence of such remedy has been presented to COMPANY, the payments withheld shall be released by COMPANY.

7.9 If and when the cause(s) for withholding any such payment are not remedied by CONTRACTOR, COMPANY shall then have the right to deduct any monies due to CONTRACTOR. For 7.7(e), COMPANY may make payments directly to the SUB- CONTRACTOR(s). Such payment shall be deemed to be a payment made to CONTRACTOR by COMPANY under this CONTRACT.

7.10 All payments to CONTRACTOR by COMPANY under the terms of this CONTRACT shall be in Ringgit Malaysia (“RM”) or any other currency as agreed in EXHIBIT III SCHEDULE OF COMPENSATION, as the case maybe.

In the event CONTRACTOR issues an invoice in other than RM to COMPANY, CONTRACTOR shall provide the respective foreign currency account for payment purposes and COMPANY shall make payment in foreign currency directly into CONTRACTOR‟S foreign currency account.

Where CONTRACTOR is unable to open a foreign currency account for any reason whatsoever, then payment shall be made in the RM equivalent. The exchange rate applicable shall be the prevailing market rate on the day of payment as quoted by COMPANY‟s bank. The prevailing market rate shall refer to the Telegraphic Transfer buying rate of the said bank. If such day falls on a day where the rate is not available, the rate quoted before such day shall be used.

All bank charges pertaining to the payment shall be borne by CONTRACTOR.

7.11 Upon notification of any erroneous billings made by or payments made to CONTRACTOR by COMPANY, CONTRACTOR shall within fourteen (14) days, issue a credit note and refund to COMPANY any amounts of overpayment. During the aforementioned fourteen (14) days, COMPANY shall withhold any payments due to CONTRACTOR. In the event CONTRACTOR fails to submit the required credit notes and refunds, COMPANY shall be entitled to deduct such amount from any payments due to CONTRACTOR.

7.12 Payments made by COMPANY under this CONTRACT shall not preclude the right of COMPANY to thereafter dispute any of the items invoiced and in no event shall any such payments affect the warranty obligations by CONTRACTOR. Any payments made shall be without prejudice to any other rights or remedies available to COMPANY.

7.13 All Service Confirmations, e-Invoices, financial statements/settlements, and billings by CONTRACTOR to COMPANY shall reflect properly the facts relating to all activities and transactions handled for COMPANY's account.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 8 TAXES, CUSTOM CHARGES AND GOODS & SERVICES TAX

8.1 CONTRACTOR shall be responsible for and shall pay at its own expense when due and payable all TAXES assessed against it in connection with the CONTRACT. All TAXES levied on CONTRACTOR shall be for the account of CONTRACTOR and shall not be reimbursed by COMPANY.

8.2 CONTRACTOR shall protect and indemnify COMPANY and hold COMPANY safe and harmless from any and all claims or liability for TAXES assessed or levied by the Inland Revenue Board of Malaysia (IRB), whichever is applicable against CONTRACTOR or its SUB-CONTRACTOR(s) or against COMPANY for or on account of any payment made to or earned by CONTRACTOR in connection with this CONTRACT.

CONTRACTOR further shall protect and hold COMPANY harmless from all TAXES assessed or levied against or on account of wages, salaries or other benefits paid to or enjoyed by CONTRACTOR‟s employees, or employees of its SUB- CONTRACTOR(s), and all TAXES assessed or levied against, on or for account of any property or equipment of CONTRACTOR or its SUB-CONTRACTOR(s).

8.3 COMPANY shall have the right to withhold TAXES from payments due to CONTRACTOR under this CONTRACT to the extent that such withholding may be required by the IRB or relevant tax authorities, and payment by COMPANY to the IRB or relevant tax authorities of the amount of money so withheld shall relieve COMPANY from any further obligation to CONTRACTOR with respect to the amount so withheld. If CONTRACTOR is under the opinion that the payment(s) should not be subject to withholding tax in Malaysia, CONTRACTOR shall submit to COMPANY a letter from IRB or the relevant tax authorities confirming that CONTRACTOR is a resident in Malaysia, failing which COMPANY shall consider CONTRACTOR a non- resident in Malaysia for tax purposes until such time that the required letter is submitted to COMPANY.

If any withholding is done, COMPANY shall provide CONTRACTOR with official receipts or other satisfactory evidence in respect of such deduction or withholding.

8.4 CONTRACTOR shall indemnify COMPANY against all claims, demands and causes of action based on any actual TAXES for which they are liable or any actual or alleged failures by CONTRACTOR or its SUB-CONTRACTOR(s) to comply with applicable tax reporting, return, or other procedural requirement with respect to the CONTRACT. This indemnity shall include without limitation all penalties, awards, and judgments; court and arbitration costs; attorneys‟ fees; and other reasonable expenses associated with such claims, demands, and causes of action.

8.5 CONTRACTOR shall give prompt notice to COMPANY of all matters pertaining to non-payment, payment under protest or claim for immunity or exemption from any TAXES.

8.6 In the event that a refund opportunity arises with respect to any TAX paid by one PARTY as a result of the transactions governed by this CONTRACT, both PARTIES shall reasonably work together to pursue such refund. If one PARTY receives a refund or a credit for any TAX paid by the other PARTY with respect to the CONTRACT, then the PARTY receiving the refund or credit agrees to refund to that other PARTY the full amount of such refund or credit.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

8.7 In the event that CONTRACTOR is a foreign incorporated company and by virtue of its activities related to the provision of services is considered to have a permanent establishment in Malaysia or in any other country, CONTRACTOR shall be solely liable or responsible for the following:

(a)

Any liability for TAXES

 

(b)

Any and all other costs incurred by CONTRACTOR due to the creation of a permanent establishment

(c)

Any tax and

other filing

obligation occasioned

by the

creation of

the

permanent establishment

8.8 For avoidance of doubt, “TAX” or “TAXES” as mentioned above shall include but not limited to all income, profit, withholding, franchise, excess profits, royalty, other taxes, personal property taxes, employment taxes and contributions imposed or that maybe imposed by law, regulations or trade union contracts, which are imposed by or on behalf the Inland Revenue Board (IRB) or of any taxing authority and includes penalties, interest and fines in respect thereof.

8.9 Applicable for Material/Equipment Contracts with Incoterms other than DDP

8.9.1 COMPANY shall be responsible for and shall pay at its own expense when due and payable all CUSTOM CHARGES assessed against it in connection with the CONTRACT.

8.9.2 CONTRACTOR shall protect and indemnify COMPANY and hold COMPANY safe and harmless from any and all claims, demands and causes of action based on any actual CUSTOM CHARGES for which they are liable or any actual or alleged failures by CONTRACTOR or its SUB-CONTRACTOR(s) to comply with applicable reporting, return, or other procedural requirement with respect to their payment of CONTRACT. This indemnity shall include without limitation all penalties, awards, and judgments; court and arbitration costs; attorneys' fees; and other reasonable expenses associated with such claims, demands, and causes of action.

8.9.3 During the performance of the CONTRACT all purchased goods listed in the "Master List of Materials and Equipment for Upstream Petroleum Operations exempt from CUSTOM CHARGES (hereinafter referred to as the "Master Exemption List" or "MEL"), that needs to be imported into Malaysia shall be made in the name of COMPANY and shall be delivered either to KSB and/or ASB. COMPANY shall apply for tax exemption prior to arrival of the goods. If CONTRACTOR decides that the goods be delivered to other than KSB and/or ASB, CONTRACTOR shall then apply to the relevant Customs Authority for importation of such goods. The importation of such goods shall be under CONTRACTOR‟s bond.

8.9.4 Notwithstanding the fact that goods are imported in the name of COMPANY, CONTRACTOR shall remain responsible for such goods while in Malaysia. CONTRACTOR shall indemnify COMPANY from and against any claims, demands and causes of action which may arise as a result of damage to, shortages or overages in inventory of such goods.

8.9.5 CONTRACTOR shall be responsible for the preparation of all documents required by the relevant Malaysian Royal Custom Department ("Customs Authority"), in connection with the import and export of goods, to and from <name of country>. CONTRACTOR is also required to provide assistance,

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

information and documentation to COMPANY as and when required for any application to be made to the Customs Authorities or any other relevant authorities for the purposes of this CONTRACT.

8.9.6 CONTRACTOR shall indemnify COMPANY from and against any claims, demands and causes of action brought by Customs Authority which may arise as a result of shortage or overages in inventory of such goods.

8.9.7 For the purpose of tax exemption application, CONTRACTOR, where applicable, shall assist COMPANY in the application of CUSTOM CHARGES exemption for the Purchase Order/Release Order issued by COMPANY and ensure that the description of the Items as contained in the commercial invoice shall correspond to the description contained in the exemption form. CONTRACTOR shall promptly provide COMPANY with all information as required by the Malaysian Ministry of Finance and/ or any other relevant authority for the purposes of the application of the exemption including but not limited to the following:

- Description of the Items;

- Quantity applied;

- New or used;

- Country of origin;

- Tariff code number;

- Date of import;

- CIF Value;

- Rate of import duty;

- Total import duty;

- Rate of sales tax;

- Total sales tax;

- Total duty/ tax; and

- Function of the Items.

8.9.8 For avoidance of doubt, CUSTOM CHARGES as mentioned above shall include but not limited to any import duty, surtax, sales tax and any other statutory imposts levied, which are imposed by or on behalf of any Customs Authority but does not include penalties, interest and fines levied due to the negligence of CONTRACTOR.

8.10 Applicable for Material/Equipment Contracts with Incoterms of DDP only

8.10.1 CONTRACTOR shall be responsible for and shall pay at its own expense when due and payable all CUSTOM CHARGES assessed against it in connection with the CONTRACT.

8.10.2 CONTRACTOR shall protect and indemnify COMPANY and hold COMPANY safe and harmless from any and all claims, demands and causes of action based on any actual CUSTOM CHARGES for which they are liable or any actual or alleged failures by CONTRACTOR or its SUB-CONTRACTOR(s) to comply with applicable reporting, return, or other procedural requirement with respect to their payment of CONTRACT. This indemnity shall include without limitation all penalties, awards, and judgments; court and arbitration costs; attorneys' fees; and other reasonable expenses associated with such claims, demands, and causes of action.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

8.10.3 CONTRACTOR shall give prompt notice to COMPANY of all matters pertaining to non-payment, payment under protest or claim for immunity or exemption from any CUSTOM CHARGES.

8.10.4 During the performance of the CONTRACT, all purchased goods that need to be imported into Malaysia shall be made in the name of COMPANY at the designated area identified by COMPANY.

8.10.5 Notwithstanding the fact that goods are imported in the name of COMPANY, CONTRACTOR shall remain responsible for such goods while in Malaysia. CONTRACTOR shall indemnify COMPANY from and against any claims, demands and causes of action which may arise as a result of damage to, shortages or overages in inventory of such goods.

8.10.6 CONTRACTOR shall be responsible for the preparation of all documents required by the relevant Malaysian Royal Custom Department ("Customs Authority"), in connection with the import and export of goods, to and from <name of country>. CONTRACTOR is also required to provide assistance, information and documentation to COMPANY as and when required for any application to be made to the Customs Authorities or any other relevant authorities for the purposes of this CONTRACT.

8.10.7 CONTRACTOR shall indemnify COMPANY from and against any claims, demands and causes of action brought by Customs Authority which may arise as a result of shortage or overages in inventory of such goods.

8.10.8 For avoidance of doubt, CUSTOM CHARGES as mentioned above shall include but not limited to any import duty, surtax, sales tax and any other statutory imposts levied, which are imposed by or on behalf of any Customs Authority and but does not include penalties, interest and fines levied due to the negligence of CONTRACTOR.

8.11 INDIRECT TAX

8.11.1 Where service tax is applicable to any services rendered by CONTRACTOR under this CONTRACT, COMPANY shall be responsible for and pay the service tax when invoiced by CONTRACTOR for any taxable service, provided that CONTRACTOR shall provide COMPANY a copy of valid Service Tax license issued by the Malaysian Royal Customs Department confirming that CONTRACTOR is licensed under the Service Tax Act, 1975 as a taxable person providing taxable services.

8.11.2 Service tax amount shall be separately stated in the prices and rates, and shall be separately itemised in the invoice.

8.12 GOODS AND SERVICES TAX

8.12.1 This Article shall only apply upon the enactment of the goods and Services Tax Bill 2009 in Malaysia and upon the implementation date of the said GST law in Malaysia.

8.12.2 The price quoted by CONTRACTOR for any taxable supplies to be made under this CONTRACT is exclusive of GST.

8.12.3 Where Goods and Services Tax (“GST”) is applicable to any supplies made by CONTRACTOR under this CONTRACT, CONTRACTOR is entitled to charge GST on the payment of the supply. The consideration for such supply shall be increased by an amount calculated as:

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

A x R

Where:

A

is the amount of consideration payable for the supply; and

R

is the applicable rate of GST

8.12.4 If CONTRACTOR is liable for GST as contemplated by Article 8.12.3 then:

(a)

CONTRACTOR shall:

(i)

provide to COMPANY information that may be reasonably required to establish its liability for GST; and

(ii)

do such things and provide such information and documents as may reasonably be required by the recipient to enable the recipient to claim an input tax credit under the GST law

(b)

where a taxable supply has been made and consideration charged but the applicable GST has not been charged, the increase in the consideration required by paragraph Z.1 shall be paid by COMPANY upon the provision of a tax invoice by CONTRACTOR in accordance with the GST law.

Where costs incurred by one party are to be reimbursed by another, the amount to be reimbursed shall be calculated net of any GST input tax credits that the party seeking reimbursement is entitled to in respect of the cost incurred.

8.13 INVOICING AND PAYMENTS

In the event that the contract is segregated for services performed inside and/or outside Malaysia, CONTRACTOR shall state the applicable description on the invoices as follows:

(a)

Services performed inside Malaysia; and/or

(b)

Services performed outside Malaysia

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 9 PERFORMANCE GUARANTEES

9.1 CONTRACTOR shall furnish to COMPANY within thirty (30) days of the award of this CONTRACT (date of award inclusive), the following PERFORMANCE

GUARANTEE(s):

(a)

An irrevocable and unconditional first call Bank Guarantee, as per the format in EXHIBIT XII PERFORMANCE GUARANTEE issued by a commercial bank operating in Malaysia and acceptable to COMPANY by way of guarantee for the due performance by CONTRACTOR of its obligations under this CONTRACT. The value of the Bank Guarantee shall, throughout the duration of this CONTRACT be maintained at the value of:

i)

RM [

Insert sum in words (10% of the CONTRACT PRICE)

][

Insert sum in

figures (10% of the CONTRACT PRICE)

] from the date of COMPANY first

demand. This guarantee shall only applicable until the issuance of NOTICE OF PROVISIONAL ACCEPTANCE.

ii)

RM

[Insert sum in words (5% of the CONTRACT PRICE)][Insert sum in

figures

(5%

of

the

CONTRACT

PRICE)]

from

the

date

of

NOTICE

OF

PROVISIONAL

ACCEPTANCE

until

the

date

of

issuance

of

CONTRACT

CLOSURE CERTIFICATE.

 

The Bank Guarantee shall be binding on CONTRACTOR notwithstanding any alterations, or extensions of time as may be made, given, conceded, or agreed under this CONTRACT. The expenses incurred in preparing, completing, and stamping such instrument shall be solely borne by CONTRACTOR; and/or

(b)

A Parental/Principal Guarantee duly executed by its ultimate holding company or principal/ technical partner(s) in the form as provided in EXHIBIT XII PERFORMANCE GUARANTEE hereof.

(c)

In the event that CONTRACTOR shall comprise two (2) or more companies acting in partnership, joint venture or otherwise, each such company shall submit a separate parental guarantee each in accordance Article 9.1.

(d)

CONTRACTOR shall also deliver to COMPANY a certificate from attorneys lawfully carrying on legal practice in the countries of incorporation of the parent companies certifying:-

(i)

that CONTRACTOR is independent of the parent company.

 

(ii)

that the parent company is empowered to execute the Parental Guarantee and has validly done so.

9.2 The Performance Guarantee(s) shall remain valid until ninety (90) days after the issuance of the Notice of Provisional Acceptance of the WORKS or any extension thereof for 9.1 (a).

For avoidance of doubt, in the event that the Performance Guarantee(s) provided do not fulfill the requirement abovementioned, CONTRACTOR shall, at least thirty (30) days prior to expiration of the Performance Guarantee(s), furnish extended Performance Guarantee(s) for the same value previously provided. Should CONTRACTOR fail to provide the extended Performance Guarantee(s) as required, COMPANY shall, without prejudice to all its other rights under this CONTRACT, invoke the Performance Guarantee(s) or otherwise have the right to withhold any

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

payments due or that may become due to CONTRACTOR after the date of such failure

9.3 If the Performance Guarantee(s) to be furnished pursuant to this Article 9 is not duly furnished by CONTRACTOR in the specified format, COMPANY may, at its own option and without prejudice to any rights or claims it may have against CONTRACTOR, by reason of CONTRACTOR‟s non-compliance with the format, perform any of the following:

(a)

withhold from payment due to or that may become due to CONTRACTOR an amount equivalent to the Bank Guarantee value until such time the Bank Guarantee is furnished by CONTRACTOR; or

(b)

terminate this CONTRACT by notice in writing to CONTRACTOR, whereupon COMPANY shall not be liable for any claim or demand from the CONTRACTOR under the provisions of this CONTRACT.

9.4 COMPANY reserves the right to instruct CONTRACTOR to revise the Bank Guarantee amount to correspond to any increase in the CONTRACT PRICE. Failure to revise the Bank Guarantee shall constitute CONTRACTOR‟s failure to perform the CONTRACT, entitling COMPANY to invoke the Bank Guarantee.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 10 WARRANTY AND REPRESENTATIONS

10.1 CONTRACTOR warrants and guarantees that the WORKS shall be performed in a professional manner in accordance with the requirements and conditions of this CONTRACT with good and sound offshore engineering, craft and fabrication practices, and that the WORKS shall be free from defects, and that all materials and equipment provided by CONTRACTOR and incorporated into the WORKS and all parts thereof shall be free from defects and complying to the CONTRACT requirements for which they are intended.

10.2 In the event that materials and equipment are supplied as part of the WORKS, CONTRACTOR guarantees the following:

(a)

the

materials

and

equipment

are

new,

unused

and

comply

with

the

SPECIFICATIONS;

 

(b)

the materials and equipment are free from defects in materials and workmanship, fit and suitable for the purpose for which they are intended under this CONTRACT; and

(c)

the materials and equipment are covered by warranty for the period of twelve (12) months from Notice of Provisional Acceptance.

CONTRACTOR‟s scope of warranty shall cover all expenses to replace all materials and equipment found to be defective during the warranty period and all services provided for making good any defective materials and equipment.

CONTRACTOR also warrants and guarantees the design, workmanship and all materials provided by it or any of its SUB-CONTRACTOR(s) or suppliers against all defects for a period of twelve (12) months from the date of NOTICE OF PROVISIONAL ACCEPTANCE. CONTRACTOR shall promptly at its own cost make good any defective part so as to be acceptable to COMPANY or COMPANY shall rectify the defective part and charge the cost of rectifying the defects to CONTRACTOR.

If CONTRACTOR does any repair or replaces any component of the WORKS under this warranty, then such repaired or replaced components shall be covered by this warranty for a period of twelve (12) months from the date of its repair or replacement, irrespective of any remaining portion of the original twelve (12) months.

10.3 Any new materials and equipment replacing the defective materials and equipment during the warranty period shall be warranted under the same terms and conditions for another period as specified in Article 10.2 (c) from the date of replacement.

10.4 In the event that CONTRACTOR obtains more favourable warranties and guarantees from its suppliers, such warranties and guarantees shall be assigned to COMPANY. CONTRACTOR shall obtain from its SUB-CONTRACTOR(s), vendors and suppliers, for assignment to COMPANY, the best possible warranties and guarantees with respect to materials and workmanship of third-party manufactured items and materials installed by CONTRACTOR.

10.5 The foregoing warranty shall be additional to and not in substitution of other warranties or rights provided by law.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

10.6 CONTRACTOR shall list out procedures, frequency and details of any preventive maintenance and precautions, which are necessary to be carried out so as not to nullify the warranty specified in Articles 10.2, Articles 10.3 and Articles 10.4. CONTRACTOR shall also specify the areas of materials that shall not be handled by COMPANY‟s personnel in observance of the warranty.

10.7 CONTRACTOR represents and warrants that the provision and / or performance of WORKS shall not be affected by the performance or functionality of any software, imbedded software or hardware utilised in the provision of WORKS.

10.8 If CONTRACTOR fails to perform the WORKS or part thereof or make good the defect or deficiency as required by COMPANY within the specified period after delivery of written notice to CONTRACTOR by COMPANY, COMPANY shall be entitled to have the WORKS or part thereof, or the defect or deficiency or part thereof, as the case may be, carried out by its own personnel or by any other contractor appointed by COMPANY. If the WORKS or part thereof, or the defect or deficiency or part thereof, which should have been rectified by CONTRACTOR at its own cost but was instead rectified by COMPANY or its contractor, COMPANY shall, without prejudice to any other rights COMPANY may possess, be entitled to recover from CONTRACTOR the total cost to COMPANY for such rectification WORKS as debt due and payable by CONTRACTOR to COMPANY on demand: such costs may be deducted from any payments otherwise due from COMPANY to CONTRACTOR and COMPANY may also have recourse to Performance Guarantee under the CONTRACT.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 11 OBLIGATIONS OF PARTIES

11.1 CONTRACTOR‟S OBLIGATIONS

11.1.1 CONTRACTOR shall promptly review the CONTRACT provided by COMPANY and shall immediately bring to the attention of COMPANY all items which in CONTRACTOR‟s opinion appear to be deficiencies, omissions, contradictions or ambiguities in such information, data, DRAWINGS and/or SPECIFICATIONS in accordance with CONTRACTOR‟s responsibilities set forth in ARTICLE 3 - RESPONSIBILITY OF CONTRACTOR TO INFORM ITSELF and ARTICLE 4 - RESPONSIBILITY OF CONTRACTOR TO INFORM COMPANY.

11.1.2 CONTRACTOR shall perform the WORKS in strict compliance with the provisions of this CONTRACT including all Exhibits attached hereto and shall comply with and adhere strictly to COMPANY's instructions and directions on any matter concerning the WORKS including all plans, programs, SPECIFICATIONS, schedules, and instructions provided or made by COMPANY for carrying out the WORKS. The foregoing shall not however be construed to exclude CONTRACTOR's duty to exercise diligence and to perform the WORKS in accordance with the warranty set forth in ARTICLE 10 - WARRANTY AND REPRESENTATIONS.

11.1.3 CONTRACTOR shall carry out all of its obligations under the CONTRACT and shall execute the WORKS with all due care and diligence and with the skill to be expected of a reputable contractor experienced in the types of work to be carried out under the CONTRACT.

11.1.4 CONTRACTOR shall take full responsibility for the adequacy, stability and safety of all operations and methods necessary for the performance of the WORKS and shall comply with the provisions of EXHIBIT IX HEALTH, SAFETY & ENVIRONMENT (HSE) REQUIREMENTS.

11.1.5 CONTRACTOR shall furnish the equipment, materials, and supplies and the necessary personnel required to perform the WORKS as specified in the Exhibits.

11.1.6 During the progress of the WORKS performed hereunder, CONTRACTOR shall ensure that its personnel keep the designated area of the WORK SITE(s) clean and orderly at all times and shall dispose of trash and spoil as instructed by COMPANY.

11.1.7 CONTRACTOR shall commence the WORKS as instructed by COMPANY.

11.1.8 CONTRACTOR Furnished Equipment, Materials, and Supplies

11.1.8.1 CONTRACTOR shall at its own cost furnish, install, maintain in good working order and repair and replace where necessary throughout the duration of this CONTRACT, relevant and adequate equipment, materials and supplies for full and proper performance of the WORKS, and shall carry all spare parts and

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

supplies as required for maintenance and good working condition of CONTRACTOR‟s EQUIPMENT.

11.1.8.2 CONTRACTOR shall ensure that all materials, tools, equipment and other items used in the WORKS, whether purchased, rented, or otherwise provided by CONTRACTOR, are properly packed and equipped with proper and acceptable slings and spreader bars, where required, and that all such materials, tools, equipment and other items used in the WORKS are in a safe, sound and good condition and capable of performing the functions for which they are intended; and are properly stored and protected against all weather elements that may be detrimental to the eventual performance of the equipment if no such protection is provided.

11.1.8.3 For equipment assigned to the offshore WORKS, CONTRACTOR must indicate on the proforma invoice that is submitted to COMPANY, at time of delivery of the equipment to COMPANY‟s SUPPLY BASE, the description, the serial number of the equipment, maintenance record, year of manufacture and/or year of purchase, with documental support.

The proforma invoice must reach COMPANY‟s SUPPLY BASE at least one day before the actual shipment. All items delivered must be accompanied by CONTRACTOR's Delivery Order and must be clearly tagged for easy identification.

11.1.8.4 If any tool or other item of equipment is, in the judgement of COMPANY, unsafe or incapable of doing the functions for which it is intended, CONTRACTOR shall repair or replace the same with a safe and capable tool or item of equipment satisfactory to COMPANY at CONTRACTOR's expense.

11.1.8.5 COMPANY shall have the right to inspect CONTRACTOR‟s EQUIPMENT at any time to observe its condition. If COMPANY notifies CONTRACTOR of any defects thereto, CONTRACTOR shall take immediate steps to rectify the said defects at its own cost. However, such inspection by COMPANY shall not imply any acceptance of the condition of the said CONTRACTOR‟s EQUIPMENT by COMPANY and CONTRACTOR shall not be relieved of its obligations under this CONTRACT by any such inspection.

11.1.8.6 CONTRACTOR shall keep and maintain up-to-date records of all CONTRACTOR‟s EQUIPMENT reflecting their conditions and quantity and shall make such records available to COMPANY whenever requested.

11.1.8.7 CONTRACTOR agrees to visually inspect all COMPANY‟s EQUIPMENT and materials furnished by COMPANY and shall

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

report to COMPANY any apparent defects therein. CONTRACTOR's use of such materials without so notifying COMPANY shall be deemed to be conclusive evidence that such materials are free from apparent defects. COMPANY‟s EQUIPMENT shall be maintained in good condition and repaired by CONTRACTOR utilising CONTRACTOR personnel provided COMPANY shall, at its costs, provide all spare parts and materials required to maintain or repair COMPANY‟s EQUIPMENT.

11.1.8.8 COMPANY shall have the right to release any part or all of CONTRACTOR‟s EQUIPMENT as specified in EXHIBIT I - SCOPE OF WORKS at any time at COMPANY‟s option upon giving CONTRACTOR advance notice, the said notice to be later confirmed in writing.

CONTRACTOR shall promptly prepare for DEMOBILISATION of whatever portion of CONTRACTOR‟s EQUIPMENT that is to be released and shall assist COMPANY in the loading and offloading of the said equipment. All payments to CONTRACTOR for such released equipment shall terminate on the dates the said equipment is delivered either to the Demobilisation Site specified in EXHIBIT IV - ADMINISTRATIVE PROCEDURES or to any other mutually agreed location, and is made available to CONTRACTOR.

COMPANY shall have the right and option to re-engage such released CONTRACTOR‟s EQUIPMENT as the same becomes available for the WORKS under the terms and conditions herein and at the rates specified in EXHIBIT III - SCHEDULE OF COMPENSATION.

11.1.9 CONTRACTOR Personnel

11.1.9.1 CONTRACTOR shall provide the necessary personnel as specified in EXHIBIT I - SCOPE OF WORKS and EXHIBIT V – CONTRACTOR’S ORGANIZATIONAL CHART AND PROJECT TEAM KEY PERSONNEL for commencement of the WORKS. CONTRACTOR shall thereafter ensure that such key personnel

are continuously available throughout the duration of the CONTRACT.

CONTRACTOR shall furnish at its sole expense any and all visas and work permits or other permits required for its personnel.

CONTRACTOR shall furnish additional personnel as COMPANY may request in writing from time to time.

11.1.9.2 All CONTRACTOR‟s personnel directly involved in the performance of the WORKS offshore shall have undergone the

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

necessary basic safety training required by COMPANY's approved training centre as listed in EXHIBIT IX HEALTH, SAFETY & ENVIRONMENT (HSE) REQUIREMENTS, and shall possess a valid COMPANY's Offshore Safety Passport. All related costs with respect to obtaining COMPANY‟s Safety Passport for CONTRACTOR‟s personnel shall be at CONTRACTOR's own expense.

11.1.9.3 Discipline In the performance of the WORKS, CONTRACTOR shall maintain strict discipline and good order among its employees and SUB-CONTRACTOR's employees and shall not permit any such persons to engage in any activities that might, in COMPANY‟s opinion, be contrary or detrimental to the performance of the WORKS or the interests of COMPANY.

11.1.9.4 Alcohol and Drug Use

a) CONTRACTOR is responsible to ensure that its employees, agents, and SUB-CONTRACTOR(s) and its servants comply with EXHIBIT IX HEALTH, SAFETY & ENVIRONMENT (HSE) REQUIREMENTS and shall not use, be in possession or under the influence of any non- prescribed drugs during the performance of the WORKS, or cause any non-prescribed drugs to be carried into the WORK SITE(s).

b) CONTRACTOR shall also ensure that its employees, agents, SUB-CONTRACTOR(s), its servants and third parties shall not use or be in possession of or distribute or engage in the sale of alcohol or alcoholic beverages at the WORK SITE(s).

c) Any of CONTRACTOR's personnel, employees, agents, SUB-CONTRACTOR(s) and third parties deemed incapable of performing his work or duties due to the influence of alcohol, shall be refused entry into or removed from the WORK SITE. CONTRACTOR shall replace such person immediately in accordance with the provisions herein contained. Any cost incurred in such replacement shall be for CONTRACTOR's account.

11.1.9.5 Replacement of CONTRACTOR Personnel

a) CONTRACTOR shall employ on the WORKS only competent and skilled personnel. Subject to all other provisions of this Clause, CONTRACTOR shall ensure that all such personnel continue in the functions and responsibilities to which they are initially assigned for as long as is necessary to achieve proper completion of the WORKS. CONTRACTOR shall not change the

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

personnel assigned to perform the WORKS without prior APPROVAL from COMPANY in writing.

CONTRACTOR shall also take steps to ensure that in the event of a replacement, the replacement personnel shall be competent, skilled and familiar with the WORKS. Such steps shall include the training of the nominated new personnel to take-over the assigned duties at no additional cost to COMPANY and shall arrange an appropriate hand-over period for the replacement personnel as accepted and APPROVED by COMPANY.

b) Without prejudice to any other rights or remedies available to COMPANY under this CONTRACT or otherwise in law, COMPANY shall be entitled to object and require CONTRACTOR to remove from the WORKS and/or replace any of CONTRACTOR‟s personnel who, in the sole opinion of COMPANY, is deemed incompetent, misconducts themself, is negligent in the performance of his duties, and/or violates COMPANY's alcohol and drug policy as stated in Clause 11.1.9.4 above and in EXHIBIT IX HEALTH, SAFETY & ENVIRONMENT (HSE) REQUIREMENTS, or is otherwise considered to be undesirable, without providing any reason whatsoever.

In such event, CONTRACTOR shall forthwith remove such person from the WORKS and such person shall not be re-employed in the WORKS again without the written permission of COMPANY. CONTRACTOR shall immediately replace, at CONTRACTOR's sole expense, any discharged person with a suitably qualified and experienced person acceptable to COMPANY. In the event CONTRACTOR fails to comply with these obligations, COMPANY shall have the option to terminate this CONTRACT.

11.1.9.6 Language Requirement CONTRACTOR shall ensure that the personnel provided pursuant to this CONTRACT are competent in and have adequate command of the English Language.

11.1.9.7 Personnel Policies

a) CONTRACTOR shall not recruit COMPANY personnel or personnel of others performing services for COMPANY.

b) CONTRACTOR shall maintain good site housekeeping and shall furnish, where applicable, to its personnel appropriate personal safety equipment, including but not limited to safety helmets, safety shoes, safety harness

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

and eye and ear protection, as specified in EXHIBIT IX HEALTH, SAFETY & ENVIRONMENT (HSE) REQUIREMENTS.

c) CONTRACTOR shall be responsible for maintaining and enhancing the safety awareness of its personnel and SUB-CONTRACTOR's personnel including arranging safety meeting and emergency drills.

d) CONTRACTOR shall establish and have its own written safety policy, safety rules and regulations for its employees and the employees of any of its SUB- CONTRACTORs and shall also acquaint COMPANY REPRESENTATIVE with the same.

11.1.9.8 At all times, CONTRACTOR shall respond promptly and shall accurately furnish to COMPANY information about the WORKS as requested.

11.1.9.9 In the execution of the WORKS, no persons other than the authorised employees or agents of CONTRACTOR and the employees or agents of COMPANY, shall be allowed on the WORK SITE without the written consent of COMPANY.

11.1.9.10 Before commencing any hazardous operations, CONTRACTOR shall prepare any necessary work procedures, shall conduct a job safety analysis and inspect the WORK SITE and equipment involved to ensure that the WORKS shall be performed under safe conditions acceptable to COMPANY. CONTRACTOR shall verify that appropriate "Work Permits" or "Certificates" are obtained and in place prior to initiating any hazardous work.

11.1.9.11 CONTRACTOR shall at no cost to COMPANY be responsible for the medical welfare of its own and SUB-CONTRACTOR's employees and shall take care of periodical medical examinations, arrangements for medical attendance, treatment or hospitalisation if and when necessary and shall arrange suitable insurance coverage for such contingencies. In cases of emergency, COMPANY may make or provide for, the necessary emergency arrangements, the costs of which shall be reimbursed to COMPANY by CONTRACTOR.

11.1.9.12 CONTRACTOR shall advise COMPANY immediately in writing of any labour dispute or anticipated labour dispute which may be expected to affect CONTRACTOR's performance of the WORKS.

11.1.9.13 In addition to all legal and specific requirements stated herein, CONTRACTOR and CONTRACTOR's agents, employees, representatives and SUB-CONTRACTOR(s) whom are engaged in the performance on the WORKS shall comply with, abide by

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

and enforce at its sole expense any rules, regulations and STANDARDS on safety, fire protection and security regulations as set forth by COMPANY in its safety manuals, policies and special instructions.

11.1.9.14 CONTRACTOR shall ensure that all its employees, agents, vendors, suppliers and SUB-CONTRACTOR(s) comply with COMPANY‟s rules, regulations, practices and requirements in the area of COMPANY's operations. This shall not relieve CONTRACTOR of its obligations as stipulated herein.

11.1.9.15 CONTRACTOR agrees that it shall not allocate its approved personnel and other critical resources to any other contracts. Otherwise, CONTRACTOR shall demonstrate to COMPANY‟s satisfaction that allocation of these resources will not adversely affect CONTRACTOR's ability to properly perform its obligations under the CONTRACT.

CONTRACTOR further agrees that when allocating its

personnel, the said contracts, including the cumulative effect of such contracts, shall not be given priority over the Scope of

WORKS.

11.1.9.16 For the duration of this CONTRACT, CONTRACTOR shall ensure that employees shall not be recruited from:

a. among COMPANY‟s personnel who are involved or are working with CONTRACTOR in CONTRACTOR's performance of the WORKS; or

b. Personnel of others performing similar or related services for COMPANY.

11.2 COMPANY‟S OBLIGATIONS

11.2.1 Government Authorities Permits COMPANY may provide assistance to CONTRACTOR in securing necessary permits or data from Malaysian government authorities and/or agencies when required by this CONTRACT. However, failure by COMPANY to obtain and provide such assistance shall not relieve CONTRACTOR from the obligation to secure the same at its own costs. CONTRACTOR shall be responsible to secure all necessary permits or data from government authorities and/or agencies other than Malaysian government when required by this CONTRACT.

11.2.2 The signing, countersigning or other endorsements of any DRAWINGS and DOCUMENTS by COMPANY, its agents or employees shall not be interpreted as implying that COMPANY, its agents or employees assume the responsibility for the correctness of such documents and shall not relieve CONTRACTOR of its obligations pursuant to Clause 11.1

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

CONTRACTOR’S OBLIGATION to review all information, data, DRAWINGS, documents and SPECIFICATIONS provided by COMPANY.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 12 ACTIONS ON BEHALF OF COMPANY

12.1 CONTRACTOR is an independent contractor and neither CONTRACTOR nor CONTRACTOR‟s employees are deemed to be agents or employees of COMPANY. CONTRACTOR shall take no action on behalf of COMPANY which would subject COMPANY to liability or penalty under any laws, rules, regulations or decrees of any relevant authority.

12.2 CONTRACTOR shall have no authority to and shall not make any statements, representations or commitments of any kind or to take action which shall be binding upon COMPANY, except as provided for herein or otherwise authorized in writing by COMPANY.

12.3 CONTRACTOR shall notify COMPANY promptly upon discovery of any instance where CONTRACTOR has not complied with the requirements of this Article and vice versa.

12.4 The entire performance, operation, management, and control of CONTRACTOR's EQUIPMENT shall be under the exclusive control and command of CONTRACTOR. CONTRACTOR's primary purpose shall be to perform all acts necessary to execute the WORKS consistent with safety, the requirements of the CONTRACT and good oil and gas industry practice.

12.5 It shall be the sole exclusive duty of CONTRACTOR to determine at all times whether the WORKS can be safely continued or undertaken. It shall be CONTRACTOR‟s duty to inspect that all cargoes and items of equipment stored at the WORK SITE and at CONTRACTOR‟s onshore base are secured in a proper manner and that CONTRACTOR‟S EQUIPMENT is in all respects suitable to undertake any contemplated operations under the existing conditions.

12.6 The presence of and the inspection and surveillance by COMPANY REPRESENTATIVE shall not relieve CONTRACTOR from CONTRACTOR‟s obligations and responsibilities hereunder.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 13 REPRESENTATIVES OF THE PARTIES

13.1 COMPANY REPRESENTATIVE

13.1.1 COMPANY REPRESENTATIVE is the person who shall be responsible for and is duly authorized to receive and act on behalf of COMPANY on all matters pursuant to the terms and conditions of this CONTRACT. COMPANY REPRESENTATIVE shall have the authority to make the final decisions for COMPANY on all questions or disputes involving the interpretation and implementation of this CONTRACT.

13.1.2 COMPANY REPRESENTATIVE shall have the right to issue instructions with respect to the CONTRACT, reject or disapprove any part of the WORKS, which does not conform to this CONTRACT, and to decide on all matters or questions which may arise relating to the performance of the WORKS and his decision shall be final and conclusive.

13.1.3 COMPANY REPRESENTATIVE (or any of its authorized delegates) shall be entitled to inspect the WORKS performed hereunder and to witness and to check all related tests on the WORKS.

13.1.4 Notwithstanding the above, the presence of and the inspection by COMPANY REPRESENTATIVE (or any of its authorized delegates) shall not relieve CONTRACTOR from CONTRACTOR's obligations and duties and shall not prejudice COMPANY's rights under this CONTRACT.

13.1.5 For avoidance of doubt, any other instructions issued by any personnel apart from COMPANY REPRESENTATIVE shall have no effect whatsoever, until and unless confirmed in writing by COMPANY REPRESENTATIVE.

13.2 CONTRACTOR REPRESENTATIVE

13.2.1 CONTRACTOR REPRESENTATIVE shall consult COMPANY REPRESENTATIVE in delivery, planning and coordination of the WORKS. All instruction(s) given by COMPANY REPRESENTATIVE consistent with the provisions of this CONTRACT shall be deemed those of COMPANY's and shall be complied with, by CONTRACTOR.

13.2.2 CONTRACTOR REPRESENTATIVE is the person who shall be responsible for and is duly authorized to receive and act on behalf of CONTRACTOR on all matters pursuant to the terms and conditions of this CONTRACT. CONTRACTOR REPRESENTATIVE shall be responsible for and is duly authorised to represent CONTRACTOR at all times during the progress of the WORKS and to receive and to act on any request made by COMPANY in the performance of the WORKS pursuant to the terms of this CONTRACT.

13.2.3 CONTRACTOR REPRESENTATIVE shall supervise, coordinate and ensure compliance of all aspects of CONTRACTOR‟s obligations under this CONTRACT.

13.3 Instructions and Notices

All instructions, notifications, agreements, authorizations, APPROVAL(s) and acknowledgments issued by COMPANY REPRESENTATIVE shall be made in writing, in accordance with ARTICLE 35 NOTICES.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 14 LIENS AND CLAIMS

14.1 CONTRACTOR shall indemnify and hold COMPANY harmless from and shall keep CONTRACTOR‟s EQUIPMENT, COMPANYs EQUIPMENT and the WORKS free of all liens, claims, assessments, fines, and levies created, caused, or committed by CONTRACTOR or its SUB-CONTRACTOR(s) and all costs, damages, and expenses incidental thereto; including without limitation all court and arbitration costs, legal fees, and other reasonable expenses. CONTRACTOR shall notify COMPANY of such liens and/or claims.

14.2 COMPANY shall have the right to retain from any payment to be made under this CONTRACT an amount sufficient to offset such liens and/or claims which CONTRACTOR fails to discharge promptly until such lien and/or claim is proven to be invalid or is satisfied, discharged, or settled.

14.3 Should there be any liens and/or claims after all payments hereunder have been made, CONTRACTOR agrees to refund to COMPANY upon demand all monies that COMPANY may be compelled to pay to discharge any such liens and/or claims in consequence of CONTRACTOR's default including all costs and legal and professional fees.

14.4 CONTRACTOR shall indemnify and hold COMPANY harmless from and against all claims, demands, damages, losses, costs, proceedings, charges, and expenses arising out of or incurred in connection with any claims or liens asserted by CONTRACTOR's SUB-CONTRACTOR(s), vendors, suppliers, or any other liens and claims arising out of the performance of this CONTRACT by CONTRACTOR.

14.5 At the completion of the WORKS hereunder and prior to COMPANY‟s issuance of the NOTICE OF FINAL ACCEPTANCE of the WORKS or earlier termination of this CONTRACT, COMPANY shall issue to CONTRACTOR a CONTRACT CLOSURE LETTER requesting CONTRACTOR to provide a CONTRACT CLOSURE CERTIFICATE as per format in the EXHIBIT IV - ADMINISTRATIVE PROCEDURES. CONTRACTOR shall provide the CONTRACT CLOSURE CERTIFICATE stating that all of CONTRACTOR's employees, SUB- CONTRACTOR(s), vendors and suppliers have been paid in full, for WORKS done or for equipment, materials and supplies furnished to, and all debts, taxes, liens, privileges, claims, charges, and obligations arising out of the purchase or lease of equipment, materials, supplies, and labour for use in the WORKS hereunder to the date of such statements in connection with the performance of the WORKS have been fully and finally paid. In the event of any dispute, CONTRACTOR shall post a bond or any other form of security acceptable to COMPANY, to secure or insure COMPANY against any such liens and/or claims.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 15 HEALTH, SAFETY AND ENVIRONMENT REQUIREMENTS

15.1 CONTRACTOR shall comply with all applicable Health, Safety and Environment (“HSE”) laws and regulations pertaining to safety, health, environment protection and fire protection, which are applicable to the location where the WORKS are being carried out. CONTRACTOR shall also comply at all times with the requirements as set forth by COMPANY in its Health, Safety and Environment Management System (“HSEMS”), policies, operating standards, site HSE requirements, COMPANY Zero Tolerance Rules (“ZeTo”) and any special instructions and all requirements stipulated in this CONTRACT. These requirements are intended to supplement any laws and regulations applicable at the location where the WORKS are being carried out. CONTRACTOR shall take all necessary HSE control and recovery measures related to or arising out of the performance of the CONTRACT in order to protect the WORKS, the personnel, environment and property of COMPANY, CONTRACTOR, SUB-CONTRACTOR(s), all third parties and public from the hazards and risks associated with the planning and execution of the WORKS.

Notwithstanding the above, CONTRACTOR shall perform all obligations related to the HSE requirements listed within EXHIBIT IX HEALTH, SAFETY & ENVIRONMENT (HSE) REQUIREMENTS.

15.2 HSE Recognition

CONTRACTOR shall work closely with COMPANY to develop the most appropriate HSE recognition program for this CONTRACT. Such HSE recognition program shall provide a structured means to periodically reward and recognize those personnel who have contributed in making the WORK SITE a safe work place. HSE incentives shall be based on merits, active participation, and the achievement of HSE performance targets.

15.3 Default of CONTRACTOR

15.3.1 The failure of CONTRACTOR to comply with COMPANY‟s applicable Health, Safety and Environment (HSE) requirements shall be deemed as a default by CONTRACTOR and shall constitute a breach of the CONTRACT.

15.4 Right to Stop Work on HSE Ground

15.4.1 COMPANY shall have the right to prohibit commencement of the WORKS or to stop any WORKS in progress on the ground of HSE ground if (without limitation) materials, construction equipment, CONTRACTOR‟s personnel (whether procured by CONTRACTOR from third parties or supplied by CONTRACTOR) or work conditions are considered by COMPANY to be unsafe or not in compliance with COMPANY‟s HSE rules and/or requirements stipulated in EXHIBIT IX HEALTH, SAFETY & ENVIRONMENT (HSE) REQUIREMENTS.

15.4.2 In such event, CONTRACTOR shall without reservation remove the unsafe materials, unsafe construction equipment, CONTRACTOR‟s personnel or work conditions prior to seeking COMPANY‟s permission to resume or commence the WORKS. Any costs incurred by CONTRACTOR as a result of any delays or actions taken or required which arise in any way in connection with this Article and/or the WORKS stoppage, shall be at CONTRACTOR‟s sole expense and shall not entitle CONTRACTOR to any compensation thereof.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

15.5 Right to Withhold Payment on the Ground of HSE Ground

15.5.1 In the event CONTRACTOR or CONTRACTOR‟s REPRESENTATIVES fail to comply with any of the HSE requirements stipulated in EXHIBIT IX HEALTH, SAFETY & ENVIRONMENT (HSE) REQUIREMENTS, COMPANY shall be entitled to withhold amounts from payments due to CONTRACTOR under this CONTRACT until CONTRACTOR rectifies the non-compliance to the satisfaction of COMPANY whereupon COMPANY shall immediately release such sums withheld to CONTRACTOR (without any interest imposed thereon).

15.5.2 In the event CONTRACTOR fails to take appropriate remedial action or refuses to remedy or remove the causes for withholding such payments after delivery of written notice to CONTRACTOR by COMPANY, COMPANY shall be entitled to cause the same to be remedied or removed and may deduct the costs including the expenses thereby incurred by COMPANY from any amounts due or owing, or which may become due or owing, to CONTRACTOR under the CONTRACT provided always that this provision shall not affect any other rights or remedies to which COMPANY may be entitled under the CONTRACT or at law or otherwise for the recovery of such sums.

15.6 Consequence Management for HSE Non-Compliance

15.6.1 In case of HSE non-compliance committed by CONTRACTOR‟s personnel which has been verified by COMPANY, consequence management shall be applied to CONTRACTOR‟s personnel.

15.6.2 If HSE non-compliances are repeatedly committed by CONTRACTOR‟s personnel, COMPANY shall have the right to terminate the CONTRACT in accordance with the provisions of Article 21.2 and claim for any loss and/or damages suffered by COMPANY as a result thereof.

15.6.3 If an incident of HSE non-compliance by CONTRACTOR occurs and results in fatality or fatalities during execution of the WORKS, COMPANY shall have the right to terminate the CONTRACT in accordance with the provisions of Article 21.2 and COMPANY shall also have the right to call on the Bank Guarantee pursuant to Article 9.1(a) of this CONTRACT to recover any loss, claims or damages suffered by COMPANY as a result thereof.

15.6.4 The above provisions are without prejudice to any other rights and remedies of COMPANY arising hereunder or by law or otherwise.

15.7 Safety Equipment

15.7.1 CONTRACTOR shall, where applicable, provide at its own expense adequate first aid, fire-fighting, life saving, and other safety equipment of approved types, capacity and amount as may be specified in connection with this CONTRACT and shall maintain this equipment in a professional manner and, where appropriate, re-certify the said safety equipment as dictated by legal and industry STANDARDS.

15.7.2 CONTRACTOR shall keep up-to-date records of all said equipment, including equipment location plans.

15.7.3 CONTRACTOR shall ensure that all cargo and items of equipment located at WORK SITE and at CONTRACTOR's onshore base are stored in a proper

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

and safe manner and that CONTRACTOR's equipment is in all respects fit and suitable to undertake any operations.

15.7.4 CONTRACTOR shall also, at its own expense, be responsible for providing its personnel with personal protective equipment as specified in EXHIBIT IX HEALTH, SAFETY & ENVIRONMENT (HSE) REQUIREMENTS.

15.8 CONTRACTOR shall have in place, prior to commencement of the WORKS, a written HSE Manual and Emergency Response Manual duly endorsed by CONTRACTOR's management and APPROVED by COMPANY. It is acknowledged that these manuals may require amendment during the performance of the WORKS but all such amendments shall be APPROVED by COMPANY in advance of the commencement of any activity for which the said amendment was enacted.

15.9 CONTRACTOR shall ensure that all machineries, equipment, and tools are maintained and operated by competent personnel who are fully trained and certified to carry out the task. The said personnel shall be authorised in writing by CONTRACTOR's management or certified by a reputable training establishment acceptable to COMPANY as specified in EXHIBIT IX HEALTH, SAFETY & ENVIRONMENT (HSE) REQUIREMENTS as being competent to perform the job.

15.10 CONTRACTOR may suspend any part of the WORKS under this CONTRACT at any time with COMPANY's prior APPROVAL because of dangerous weather or sea conditions or other reasons relating to safety. Similarly, if requested to do so by COMPANY in writing, CONTRACTOR shall immediately suspend all or a designated part of the WORKS as may be requested by COMPANY because of dangerous weather or sea conditions or other reasons relating to safety. In this event, CONTRACTOR shall take all reasonable measures to protect all personnel, the WORK SITE(s), COMPANY and CONTRACTOR‟s EQUIPMENT and their components.

15.11 In addition to all legal and specific requirements stated herein and all applicable legislative requirements where the WORKS are being executed, CONTRACTOR and CONTRACTOR's agents, employees, representatives and SUB-CONTRACTOR(s) who are engaged in the performance of the WORKS shall comply with, abide by and enforce at its sole expense any rules, regulations, and standards on safety, health, fire protection and environmental protection as set forth by PETRONAS and COMPANY in its published safety manuals, policies and special instructions.

15.12 Before commencing any WORKS, COMPANY requires that CONTRACTOR inspect the WORK SITE(s) and the equipment involved to ensure that the WORKS shall be performed under safe conditions acceptance to COMPANY. These inspections must be evidenced by "Work Permits" issued by COMPANY prior to initiating any such WORKS. COMPANY REPRESENTATIVE or his designated representatives shall have the right to prohibit commencement of WORKS or stop any WORKS in progress if the equipment, personnel or WORKS conditions are considered to be unsafe or not to be in compliance with COMPANY rules and regulations.

15.13 CONTRACTOR shall prohibit the consumption and/or possession of alcoholic beverages or dangerous drugs at the WORK SITE.

15.14 CONTRACTOR shall prepare and execute an accident prevention programme to the APPROVAL of COMPANY. At monthly intervals and at such lesser periods as is determined by COMPANY, CONTRACTOR and COMPANY REPRESENTATIVE‟s or

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

their designated delegates shall conduct safety inspections of the WORK SITE and CONTRACTOR shall promptly conform to all recommendations made pursuant to said inspections.

15.15 CONTRACTOR shall compile and maintain safety records and data pertaining to its WORKS with COMPANY. These records shall be updated and submitted to COMPANY REPRESENTATIVE as and when required.

15.16 CONTRACTOR shall be wholly responsible for the safety and safe working practices of its employees, servants or agents, and all equipment, and shall be responsible for the training of its employees, servants or agents on safety and safe working practices. CONTRACTOR shall ensure that the personnel to be provided in the performance of the WORKS are adequately trained in safety precautions and safe working practices before they are involved in the WORKS and that they are competent to undertake their required duties in a safe and efficient manner. CONTRACTOR shall be responsible for maintaining and enhancing the safety awareness among its personnel and SUB-CONTRACTOR's personnel, including arranging regular safety meetings and emergency drills. Copies of minutes of CONTRACTOR safety meetings shall be submitted to COMPANY within three (3) working days of any such meeting.

15.17 All personnel assigned to WORK SITE shall be provided with approved safety helmets, safety glasses, safety shoes and ear protections, by CONTRACTOR. CONTRACTOR shall also provide to personnel assigned for special jobs with approved life lines, life jackets/life vests, breathing equipment, welding helmets, and all other protective equipment as necessitated by the WORKS and good industrial safety practices. All such equipment shall be in good and serviceable condition. Any such equipment deemed to be in unacceptable or unserviceable condition shall be immediately replaced by CONTRACTOR.

15.18 CONTRACTOR shall allow COMPANY REPRESENTATIVE and/or its designated third party personnel access at any time to conduct audit on CONTRACTOR Personnel, records and any other matters related to the safety aspect of the WORKS at the WORK SITE(s).

15.19 WORK SITE MEDICAL FACILITIES

15.19.1 CONTRACTOR shall provide proper medical facilities with sickbay and first aid equipment including a standby Ambulance with a qualified medical assistant at the WORK SITE. The standby Ambulance with a qualified medical assistant shall always be available while WORKS are ongoing at the WORK SITE.

15.19.2 CONTRACTOR shall, at its own expense, be responsible for the medical welfare of its employees, agents and SUB-CONTRACTOR(s) and shall take care of periodical medical examinations, arrangements for medical attendance, treatment or hospitalization if and when necessary and shall arrange suitable insurance coverage for such contingencies. In cases of emergency, COMPANY may make or provide for, the necessary emergency arrangements, the costs of which shall be reimbursed by CONTRACTOR to COMPANY.

15.20 CONTRACTOR shall at CONTRACTOR's cost provide a certified Safety & Health Officer (SHO) who shall be assigned at the WORK SITE, when required, during the

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

performance of the WORKS in accordance with of EXHIBIT IX HEALTH, SAFETY & ENVIRONMENT (HSE) REQUIREMENTS. CONTRACTOR's certified SHO shall be a person who is familiar with the safety aspects mentioned hereinbefore, including the instructions, regulations and procedures provided by COMPANY.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 16 ACCEPTANCE OF WORKS

16.1 COMPANY shall have the right to monitor and review, from time to time, CONTRACTOR‟s performance of the WORKS under this CONTRACT and CONTRACTOR‟s compliance with its obligations hereunder.

16.2 All WORKS under this CONTRACT shall be performed in accordance with this CONTRACT to the satisfaction of COMPANY REPRESENTATIVE, who shall, in all cases, determine the amount, quality, acceptability and fitness of the WORKS.

16.3 Pursuant to this Article 16, COMPANY REPRESENTATIVE shall, decide on all matters as to the performance and fulfilment of this CONTRACT and his decision thereon shall be final and conclusive.

16.4 Notwithstanding the above, acceptance of the WORKS, or part thereof or APPROVAL of CONTRACTOR's activities for the WORKS, or part thereof, or partial payments made to CONTRACTOR shall not relieve CONTRACTOR of any of its obligations and/or liabilities provided for under this CONTRACT. Such acceptance shall not prejudice COMPANY‟s right to reject the WORKS, in whole or in part, if the WORKS and/or goods subsequently are found to be not in accordance with this CONTRACT including but not limited to, whether by reason of not being of the quality or not in the quantity or measurement stipulated or being unfit for the purpose for which they are required.

16.5 If CONTRACTOR fails to rectify the defective WORKS, COMPANY shall have the right to rectify the defects and to claim from CONTRACTOR for any additional expenses incurred without prejudice to any other rights which COMPANY may have against CONTRACTOR under this CONTRACT or at law.

16.6 Mechanical Completion

16.6.1 As soon as the fabrication of WORKS passes CONTRACTOR‟s final inspections and tests, CONTRACTOR shall give COMPANY written notice that it considers the fabrication of the WORKS to be completed according to the CONTRACT requirements. This notice shall specify the date that CONTRACTOR considers to be the MECHANICAL COMPLETION DATE.

16.6.2 COMPANY shall perform such inspections and test of the fabrication scope of WORKS, as it deems appropriate, and shall accordingly respond in writing to CONTRACTOR whether to accept or reject the specified MECHANICAL COMPLETION DATE. If COMPANY agrees that the fabrication scope of the WORKS is complete, COMPANY shall issue the MECHANICAL COMPLETION DATE NOTICE.

16.6.3 Otherwise, COMPANY shall issue a written response specifying the deficiencies and incomplete items. In this case, CONTRACTOR shall remedy the deficiencies and complete the items at its own cost and shall again give COMPANY written notice that CONTRACTOR considers the fabrication of scope of the WORKS to be completed.

16.6.4 If COMPANY REPRESENTATIVE rejects the rectified item or part thereof during the re-inspection, then the procedure set forth above shall be repeated until all the defect(s) are corrected.

16.6.5 Notwithstanding the above, COMPANY, at its discretion, may issue a qualified MECHANICAL COMPLETION DATE NOTICE specifying the

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

deficiencies and items to be remedied and completed at a later stage. The qualified MECHANICAL COMPLETION DATE NOTICE shall signify COMPANY‟s agreement that the fabrication scope of the WORKS is substantially complete, subject to whatever qualifications may be stated in the qualified MECHANICAL COMPLETION DATE NOTICE. COMPANY and CONTRACTOR may mutually agree to apply this review procedure selectively to parts of the scope of WORKS, in sequence, as the parts are completed.

16.6.6 After COMPANY has issued a MECHANICAL COMPLETION DATE NOTICE, CONTRACTOR shall deliver to COMPANY all DOCUMENTATION as specified in EXHIBIT I - SCOPE OF WORKS.

16.7 Partial Turnover

16.7.1 During fabrication and/or execution of the WORKS, COMPANY shall have the right to take possession of and use for any purpose any part of the WORKS at any time. COMPANY shall notify CONTRACTOR of COMPANY‟s intention to take possession of and use the said part of the WORKS. Such taking possession or use shall be deemed to be COMPANY‟s acknowledgement of turnover. However, it shall not relieve CONTRACTOR from its obligations to complete all remaining items of the scope of WORKS.

16.8 Notice of Provisional Acceptance

16.8.1 As soon as the Offshore HOOK-UP and COMMISSIONING of the WORKS passes CONTRACTOR‟s final inspections and tests, COMPANY shall have right to inspect and verify the completed WORKS as per requirement in this CONTRACT. CONTRACTOR shall give COMPANY written notice for issuance of NOTICE OF PROVISIONAL ACCEPTANCE that it considers the Offshore HOOK-UP and COMMISSIONING of the WORKS to be completed according to the CONTRACT requirements. COMPANY shall perform such inspections and tests of the Offshore HOOK-UP and COMMISSIONING of the WORKS, as it deems appropriate upon receipt of CONTRACTOR‟s written notice.

16.8.2 COMPANY shall issue to CONTRACTOR on the NOTICE OF PROVISIONAL ACCEPTANCE signifying COMPANY‟s conditional acceptance of the scope of WORKS or part thereof and COMPANY‟s agreement that the scope of WORKS or part thereof have been installed and commissioned offshore, that all known deficiencies qualified in the MECHANICAL COMPLETION DATE NOTICE has been corrected or subject to whatsoever qualifications that may be stated in the NOTICE OF PROVISIONAL ACCEPTANCE and whereupon the warranty period shall commence.

16.8.3 The warranty period referred to in ARTICLE 10 WARRANTY AND REPRESENTATIONS hereof shall commence upon issuance of the NOTICE OF PROVISIONAL ACCEPTANCE for the scope of WORKS or part thereof and shall continue to be in force until 12 months thereafter.

16.8.4 Upon issuance of NOTICE OF PROVISIONAL ACCEPTANCE, CONTRACTOR shall promptly return to COMPANY all COMPANY‟s supplied materials and equipment not consumed in the completion of the WORKS in a manner and condition satisfactory COMPANY, together with proper identification and certification documents.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

16.8.5 Within thirty (30) days from the NOTICE OF PROVISIONAL ACCEPTANCE, CONTRACTOR shall submit to COMPANY a WORKS CLOSURE CERTIFICATE stating all outstanding items and billings under the CONTRACT for COMPANY‟s APPROVAL. Such items shall include outstanding billing or payment of CONTRACT PRICE, CHANGE ORDER, reimbursable and other charges under the CONTRACT. COMPANY shall not entertain CONTRACTOR's inclusion or amendment to the WORKS CLOSURE CERTIFICATE which may arise beyond the date as described in this Article. CONTRACTOR shall expeditiously resolve all outstanding PUNCHLIST items, billings and any other obligations under the CONTRACT to the satisfaction of COMPANY.

16.9 Notice of Final Acceptance

16.9.1 Within thirty (30) days from end of the Warranty period and after all repairs, rectification, replacements and making good thereto have been carried out in accordance with the CONTRACT, and all requirements of this CONTRACT have been satisfactorily met, COMPANY shall issue a NOTICE OF FINAL ACCEPTANCE to CONTRACTOR. However, prior to the issuance, CONTRACTOR shall submit to COMPANY the CONTRACT CLOSURE CERTIFICATE as referred to in ARTICLE 14 LIENS AND CLAIMS.

16.10 Non-Performance or Defective Performance

16.10.1Where COMPANY has found the scope of WORKS or part thereof or any re- work performed by CONTRACTOR not to have been performed in accordance with the CONTRACT, including but not limited to replacement of any defective materials and equipment, COMPANY shall have the right under ARTICLE 32 NON EXCLUSIVE AGREEMENT to engage a third party to perform any part of the scope of WORKS which has not been performed or re-performed in accordance with the CONTRACT.

16.10.2 Where COMPANY engages a third party to perform or re-perform any part of the scope of WORKS, which has not been performed or re-performed by CONTRACTOR in accordance with the CONTRACT, CONTRACTOR shall be liable for any additional costs (including, without limitation, the total costs of the performance or re-performance of the WORKS by the third party) reasonably incurred by COMPANY as a direct result of the non-performance, defective performance or re-performance of the WORKS by CONTRACTOR.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 17 DEFAULT OF CONTRACTOR

17.1 The occurrence of any of the following events shall be deemed a default by CONTRACTOR under this CONTRACT:-

(a)

Any attempted transfer, novation or assignment by CONTRACTOR under this CONTRACT without the prior written APPROVAL of COMPANY; or

(b)

The making by CONTRACTOR of an assignment for the benefits of creditors, the filing by or against CONTRACTOR of a petition in bankruptcy or for corporate re-organization, or the appointment of a receiver or trustee for CONTRACTOR or the properties of CONTRACTOR; or

(c)

The failure of CONTRACTOR to satisfy within thirty (30) days of its entry any judgment upon which execution is possible or the attachment of any general liens against the real or personal property of CONTRACTOR; or

(d)

If CONTRACTOR is deemed by COMPANY as incompetent or has acted in a manner prejudicial to COMPANY‟s best interest; or

(e)

If CONTRACTOR has failed to perform the scope of WORKS or part thereof, in a diligent, skillful and professional manner and in accordance with good engineering practice as required herein, failed to comply with COMPANY‟s safety or other rules or regulations, has produced sub-standard work, the goods supplied are defective or failed to adhere to any of its duties and obligations under this CONTRACT; or

(f)

If CONTRACTOR failed to commence the scope of WORKS as directed by COMPANY or suspends or abandons the performance of the scope of WORKS; or

(g)

If CONTRACTOR persistently neglects to carry out its obligations under this CONTRACT; or

(h)

The failure by CONTRACTOR to deliver the goods by the due date or failure to make good/replace defective scope of WORKS/goods to COMPANY‟s satisfaction; or

(i)

The failure by CONTRACTOR and/or its SUB-CONTRACTOR(s) to maintain a valid PETRONAS‟ license; or

(j)

If CONTRACTOR has failed to comply with COMPANY‟s applicable Health, Safety and Environmental (HSE) laws and regulations as per ARTICLE 15 - HEALTH, SAFETY AND ENVIRONMENT REQUIREMENTS; or

(k)

In the event of severed relationships between CONTRACTOR and its principal and/or the Original Equipment Manufacturer (OEM); or

(l)

If CONTRACTOR has failed to submit the requisite Performance Guarantees and Insurance as per ARTICLE 9 PERFORMANCE GUARANTEES and ARTICLE 19 - INSURANCES herein.

(m)

If CONTRACTOR has, in the opinion of COMPANY furnished false and/or misleading records and/or has made a representation and/or warranty that was incorrect at the time of communication to COMPANY.

(n)

Failure to maintain any joint venture agreement with CONTRACTOR‟s associate or partner which is executed prior to award of this CONTRACT (if any).

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

17.2 COMPANY shall notify CONTRACTOR in writing of any default and CONTRACTOR shall within a period of seven (7) days (date of notice included), or any other period deemed appropriate by COMPANY, commence and complete the appropriate corrective actions.

17.3 In the event that CONTRACTOR fails to complete rectification of the default within the notice period as per Article 17.2 hereinabove, COMPANY shall, without prejudice to any other rights it may have, withhold any payments due to CONTRACTOR as per ARTICLE 7 INVOICING AND PAYMENTS, enforce the Performance Guarantees as per ARTICLE 9 - PERFORMANCE GUARANTEES, suspend the WORKS (full or partial) as per ARTICLE 20 SUSPENSION OF SCOPE OF WORKS and/or terminate the CONTRACT as per ARTICLE 21 - TERMINATION herein.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 18 LIABILITIES AND INDEMNITIES

For the purposes of this Article, COMPANY GROUP shall mean PETRONAS and its subsidiaries, COMPANY, its CO-VENTURERS, its and their respective AFFILIATES, its and their respective directors, officers and employees.

18.1 Personnel of COMPANY GROUP

COMPANY shall be responsible for and shall protect, defend, indemnify and hold harmless CONTRACTOR and SUB-CONTRACTOR(s) from and against any and all claims, liabilities, costs, damages and expenses of every kind and nature, with respect to injury or death or damage to or loss of property of any person employed by COMPANY GROUP, howsoever arising.

18.2 Personnel of CONTRACTOR

CONTRACTOR shall be responsible for and shall protect, defend, indemnify and hold harmless COMPANY GROUP from and against any and all claims, liabilities, costs, damages and expenses of every kind and nature, with respect to injury or death or damage to or loss of property of any person employed by CONTRACTOR and/ or SUB-CONTRACTOR(s), howsoever arising.

18.3 Third Party

CONTRACTOR shall be responsible for and shall protect, defend, indemnify and hold harmless COMPANY GROUP from and against any and all claims, liabilities, costs, damages and expenses of every kind and nature, with respect to injury, illness or death of, or damage to or loss of property of any third party, arising during and/or as a result of the performance of this CONTRACT without regard to whether any act or omission of COMPANY GROUP contributed to such injury, death or damage to or loss of property. However CONTRACTOR shall not be held responsible nor be liable to indemnify and hold COMPANY GROUP harmless for injury, death or property damage caused by WILFUL MISCONDUCT of COMPANY GROUP. CONTRACTOR's indemnity hereunder shall not exceed Ringgit Malaysia Four Million (RM4,000,000) or equivalent value in other currency per occurrence.

18.4 COMPANY’s PROPERTY

CONTRACTOR shall be liable for and shall indemnify COMPANY GROUP against any damage to or destruction or loss of property operated and/ or owned by COMPANY arising during, and/or as a result of the performance of this CONTRACT, without regard to whether any act or omission of COMPANY GROUP contributed to the loss. CONTRACTOR's indemnity hereunder, shall not exceed Ringgit Malaysia Six Million (RM6,000,000) or equivalent value in other currency per occurrence.

18.5 CONTRACTOR’s EQUIPMENT

18.5.1 CONTRACTOR shall assume the risk of, and shall be solely responsible for and in this regard shall indemnify, defend and hold COMPANY harmless against any claims arising out of all damage to and/or loss or destruction of CONTRACTOR‟s EQUIPMENT and property and its SUB-CONTRACTOR(s)‟ Equipment and property, from any cause whatsoever, at all times during the duration of this CONTRACT. In the event that any CONTRACTOR‟s EQUIPMENT lost or damaged, affects the performance of the WORKS, CONTRACTOR shall replace any lost or damaged CONTRACTOR‟s

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

EQUIPMENT at CONTRACTOR's sole cost in the most expeditious manner possible and at CONTRACTOR's sole expense.

18.6 Pollution

18.6.1 CONTRACTOR shall indemnify and hold harmless COMPANY from and against such liability resulting from pollution or reimburse company for cost incurred or payments made by COMPANY to control or clean up the pollutant or to prevent the threat of pollution or as compensation for damage suffered by others from any pollution arising from CONTRACTOR‟s performance of the WORKS under this CONTRACT.

18.6.2 The indemnity addressed in Article 18.6.1 shall include all control and/or cleanup costs, and/or claims related to any such pollution.

18.7 The indemnities given by CONTRACTOR shall not be reduced by reasons of any omission of COMPANY REPRESENTATIVE in failing to supervise or control CONTRACTOR's site operations or methods of working or to detect or prevent or remedy defective completion of the WORKS or to ensure proper performance of any other obligations of CONTRACTOR under this CONTRACT.

18.8 Unless provided for to the contrary elsewhere within this CONTRACT, CONTRACTOR shall be solely responsible for the costs of all loss or damage caused by the WILFUL MISCONDUCT / GROSS NEGLIGENCE of CONTRACTOR and/or its SUB-CONTRACTOR(s).

18.9 CONTRACTOR shall notify COMPANY immediately of any incident, claims or litigation which may come under the terms of the provisions of this Article.

18.10 Any exclusion or limitation of liability specified in this CONTRACT shall apply to claims in Tort or otherwise at law in respect of matters covered by such exclusion or limitation.

18.11 In no event shall either PARTY be liable to the other by way of indemnity nor by reason of any breach of CONTRACT nor by reason of Tort, for any indirect, remote or consequential losses of any kind, including but not limited to, loss of profit, loss of earnings or for any financial or economic loss or damages whatsoever that may be suffered by the other PARTY.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 19 - INSURANCES

19.1 CONTRACTOR shall at its own cost and expense carry and maintain in full force throughout the duration of this CONTRACT at least the following insurances with insurance companies satisfactory to COMPANY. Nothing contained herein shall serve in any way to limit or waive CONTRACTOR's liability under this CONTRACT. The insurances to be carried by CONTRACTOR are as follows:-

(a)

Workmen's Compensation and/or Employer's Liability Insurance and/ or similar statutory social insurance as required by law at the WORK SITE(s) where the scope of WORKS shall be performed and which may be applicable covering all CONTRACTOR'S employees engaged in accomplishing the scope of WORKS.

(b)

Comprehensive General Liability or Third Party Liability or Public Liability Insurance covering all operations hereunder against bodily injury, death, loss of property or property damage to third parties with minimum limits of Ringgit Malaysia Four Million (RM4,000,000) or equivalent value in other currency for any one occurrence. Such insurance shall include contractual liability coverage.

(c)

All Risks” Property Damage Insurance to cover the full replacement value of CONTRACTOR's and/or its SUB-CONTRACTOR(s)‟ equipment, used, owned, leased, chartered or hired by CONTRACTOR and/or its SUB- CONTRACTOR(s) including, but not limited to losses occurring at the WORK SITE and/or in transit to or from WORK SITE and/or between WORK SITE.

(d)

All Risks (including War and Strikes Risks) Insurance covering all vessels and waterborne crafts (whether navigable or not) and equipment, including but not limited to hull and machinery owned, leased, chartered or hired by CONTRACTOR for the replacement value thereof as and when declared by CONTRACTOR and providing coverage against losses and damages by such perils and risks equivalent to those set forth in:-

i) The Institute Time Clauses (Hull) dated 1st October 1983 or as may be revised;

ii) The Institute Time Clauses - Port Risk, dated 13th October 1959 or as may be revised;

iii) The Institute of War and Strikes Clauses Hulls - Time dated 1st October 1977 or as may be revised;

and or such other relevant Institute clauses as may be agreed and APPROVED by COMPANY in writing.Such insurance shall take effect from the mobilization of any waterborne craft until the completion of the WORKS

(e)

Protection and Indemnity Insurance and/or Marine Liability Insurance, for owned, non-owned or hired waterborne craft covering CONTRACTOR's liabilities including but not limited to crew, pollution, wreck and contractual liability arising from the use and/or operation of the said craft for an amount of at least Ringgit Malaysia Six Million (RM6,000,000) or equivalent value in other currency or the value of the said craft whichever is higher. Such insurance shall take effect from the mobilisation of any waterborne craft until completion of the WORKS.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

(f) Motor Vehicles Liability Insurance for owned, non-owned, and hired automobiles covering the use of such vehicles in accordance with the Road Transport Act,1997 or according to applicable law.

CONTRACTOR shall cause COMPANY, AFFILIATES, and their respective agents, consultants, officers and employees to be included as an additional assured and covered by the insurances as stipulated in Article 19.1(b) and Article 19.1(e) with respect to the operations conducted under this CONTRACT but only to the extent of the liabilities expressly assumed by CONTRACTOR in the CONTRACT. All other insurance where COMPANY, subsidiaries, AFFILIATES, consultants and their respective agents, officers and employees are not named as additional assured, CONTRACTOR shall include a waiver of all expressed or implied rights of subrogation against such Parties and their respective employees, servants and agents but only to the extent of the liabilities expressly assumed by CONTRACTOR in the CONTRACT.CONTRACTOR shall further cause the insurance as stipulated in Article 19.1(b) and Article 19.1(e) herein to contain a "severability-of- interests" (Cross Liability) Clause providing that in the event of one insured Party incurring liability to any of the other insured Parties, the insurance shall apply for the benefit of the insured Party against whom claim is or may be made in the same manner as if separate policies had been issued to each Party but only to the extent of the liabilities expressly assumed by CONTRACTOR in the CONTRACT.

19.2 Without limiting or waiving CONTRACTOR‟s responsibility under the CONTRACT,

COMPANY shall at its own expense, procure and maintain in full force the following

insurance:-

(a)

Builders All Risks and Transportation Insurance against “all risks” of physical loss or damage to the WORKS including equipment, materials and structures supplied to or provided by CONTRACTOR, in transit and/or at the WORK SITE and which are to be incorporated into the WORKS except fabrication tools, equipment and other property belonging to or rented by CONTRACTOR or its SUB-CONTRACTOR(s). The deductible amount for this insurance shall be as follows:

(i)

Ringgit Malaysia Ten Million (RM 10,000,000) or equivalent value in other currency for any pipelaying works and/or installation of subsea equipment works at water depth more than 200 meters; and/or

(ii)

Ringgit Malaysia Six Million (RM 6,000,000) or equivalent value in other currency for any pipelaying works at water depth less than 200 meters; and/or

(ii)

Ringgit Malaysia Four Million (RM4,000,000) or equivalent value in other currency for other type of works not described above

(b)

Comprehensive General Liability Insurance providing coverage for an amount not exceeding Ringgit Malaysia Seventy Five Million (RM75,000,000) or equivalent value in other currency for any one occurrence in respect of third party claims. This insurance, however, shall only apply over and above the limits carried by CONTRACTOR as specified under Articles 19.1 (b) & Article 19.1 (e).

COMPANY shall include CONTRACTOR and its SUB-CONTRACTOR(s) as additional assured under the foregoing insurances and shall cause the insurers thereof to waive all express or implied rights of subrogation against

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

such parties, their respective employees, servants and agents. Insurance under ARTICLE 19 shall also include a “severability-of-interest” (Cross Liability) clause.

19.3 All deductibles applicable to the insurances stipulated in Article 19.2 herein and resulting from any act or omission of CONTRACTOR and its SUB-CONTRACTORs, representatives and agents shall be for the account of and be paid by CONTRACTOR. Any losses as a result of any breach of conditions and/or warranties contained in such policies of insurance and all costs of replacement or reinstatement thereof including increased premiums resulting therefrom shall also be for the account of CONTRACTOR.

CONTRACTOR shall carry and maintain any other insurance which may be relevant and/or necessary and/or as may be required by any law(s) to which CONTRACTOR and/or SUB-CONTRACTOR(s) are subjected to or as instructed by COMPANY.

19.4 (a) To the extent of indemnities given by CONTRACTOR herein, CONTRACTOR shall cause COMPANY and its CO-VENTURERS, their parent companies, subsidiaries, AFFILIATES, consultants and their respective agents, officers and employees to be included as additional assured and to be covered by insurance(s) as stipulated in Article 19.1(b) with respect to operations conducted under this CONTRACT. CONTRACTOR shall further cause the insurance policy as stipulated in Article 19.1(b) herein to contain a "Severability of Interests" (Cross Liability) Clause providing that in the event of one insured PARTY incurring liability to any of the other insured PARTIES, the insurance shall apply for the benefit of the PARTY against whom claim is or may be made in the same manner as if separate policies had been issued to each insured PARTY.

(b) Where COMPANY and its CO-VENTURERS, their parent companies, subsidiaries, AFFILIATES, consultants and their respective agents, officers and employees are not named as additional assured in the insurance(s) as stipulated in Article 19.1(b), CONTRACTOR shall cause the insurers thereof to waive all express or implied rights of subrogation against such PARTIES and their respective employees, servants and agents.

19.5 All deductibles, exceptions, and exclusions applicable to the foregoing insurances shall be for the account of and be paid by CONTRACTOR. Any breach of conditions and/or warranties contained in such policies of insurances shall also be for the account of CONTRACTOR.

19.6 CONTRACTOR shall fully indemnify COMPANY against all and any loss or damage arising out of any failure to effect or maintain such insurances specified by this CONTRACT or out of any act or omission which invalidates the said insurances.

19.7 Unless otherwise APPROVED by COMPANY, CONTRACTOR shall within fourteen (14) days of the award of this CONTRACT (date of award inclusive) furnish to COMPANY certified copies of certificates of insurance(s) provided for in Article 19.1 hereof, including evidence of premiums payments thereof. No insurance shall be materially changed or cancelled during this CONTRACT duration without prior written APPROVAL of COMPANY. CONTRACTOR shall cause the insurer to endorse such policies of insurance to provide COMPANY with not less than thirty (30) calendar days of cancellation or material change thereof. Any renewal and/or extension

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

certificates and/ or documents shall be furnished to COMPANY within fourteen (14) days from the date of renewal and/ or extension.

If requested by COMPANY, CONTRACTOR shall permit COMPANY to examine copies of its and its SUB-CONTRACTOR(s)‟ insurance policies and premium receipts.

19.8 The furnishing of certificates of insurance(s) shall not be interpreted as implying endorsement by COMPANY or that COMPANY assumes responsibility for the accuracy and adequacy of such documents or that CONTRACTOR has complied with its other obligation contained in the CONTRACT.

19.9 Should CONTRACTOR at any time neglect or refuse to provide or renew any insurance(s) required herein, or should any insurance(s) be cancelled, COMPANY shall upon notification to CONTRACTOR have the right to procure such insurance and, in such event, any sum so paid by COMPANY shall immediately become due and payable to COMPANY by CONTRACTOR or COMPANY shall be entitled to deduct such sums from any monies due or which may become due to CONTRACTOR in addition to any other remedies COMPANY may have under this CONTRACT.

19.10 CONTRACTOR shall notify COMPANY immediately upon receipt of any notice of claims, incidents, or demands or of any situation which may give rise to such claims or demands being made under the said insurance(s) policies. Written notice shall be given no later than two (2) days after the occurrence of any accident (day of occurrence inclusive). However, for serious accidents (including but not limited to death or serious injuries) notice shall be given immediately and must be confirmed in writing.

19.11 CONTRACTOR shall ensure that its SUB-CONTRACTOR(s) maintain similar insurance coverage as specified herein and that its SUB-CONTRACTOR(s) similarly indemnify and hold COMPANY harmless against all costs, claims, and demands. Any deficiencies in the coverage or policy limits of SUB-CONTRACTOR(s)‟ insurance shall be for the sole responsibility of CONTRACTOR.

19.12 COMPANY shall bear no financial liability attributable to deficient insurance coverage by CONTRACTOR.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 20 SUSPENSION OF WORKS

20.1 COMPANY shall have the right to suspend this CONTRACT for the following reasons:

(a)

a Force Majeure occurrence as per ARTICLE 24 - FORCE MAJEURE herein;

(b)

upon the occurrence of CONTRACTOR‟s default as per ARTICLE 17 DEFAULT OF CONTRACTOR herein; or

(c)

For any other operational reason as deemed fit by COMPANY.

Except for suspension under Article 20.1(a) hereinabove, any period of suspension shall not result in any prolongation of time.

20.2 In the event that COMPANY suspends all or part of the remaining WORKS under Article 20.1 hereinabove, COMPANY shall give CONTRACTOR at least three (3) days prior written notice specifying the effective date of the suspension, including where possible, the anticipated period of suspension.

20.3 Upon receipt of the notice of suspension as per Article 20.2 hereinabove, CONTRACTOR shall perform the following on the effective date of suspension:

(a)

cease performance of the said suspended part of the WORKS;

(b)

continue to perform the WORKS which are not affected by such suspension; and

(c)

remove CONTRACTOR‟s personnel and item(s) not required during such suspension.

20.4 Neither COMPANY nor CONTRACTOR shall be liable to the other PARTY for loss of anticipated profits or consequential loss sustained on account of any suspension of the WORKS or part thereof.

20.5 COMPANY may, at any time, authorize resumption of all or any part of the suspended WORKS by giving notice to CONTRACTOR specifying the WORKS to be resumed and the effective date of withdrawal of suspension. Upon receipt of such instruction, CONTRACTOR shall resume the WORKS. Notwithstanding, the aforementioned, either PARTY may request for a joint examination to the scope of WORKS affected by such suspension. CONTRACTOR shall resume the WORKS within ten (10) calendar days after receipt of such notice, where applicable.

20.6 CONTRACTOR shall take all actions necessary to maintain and safeguard the suspended WORKS including WORKS already in progress, materials, DRAWINGS, documents, equipment and supplies in transit and at the WORK SITE against any deterioration, loss or damage and to minimise all costs to COMPANY and CONTRACTOR resulting from such suspension.

20.7 CONTRACTOR shall comply with COMPANY‟s instructions with respect to all activities in connection with any suspension of the scope of WORKS or part thereof. Compensation for suspension shall only be limited to actual and reasonable expenses for the purpose of maintaining and safeguarding the scope of WORKS during the period of suspension. CONTRACTOR shall not be compensated for expenses that resulted from suspension of WORKS due to safety, health, fire protection and environmental protection and security regulation reasons.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 21 TERMINATION

21.1 Termination Without Cause

COMPANY may at any time, terminate without cause this CONTRACT by giving thirty (30) days prior written notice to CONTRACTOR that COMPANY intends to terminate this CONTRACT, specifying this CONTRACT to be terminated and the effective date of termination.

21.2 Termination With Cause

Subject to the provision provided under ARTICLE 17 - DEFAULT OF CONTRACTOR herein, COMPANY shall have the right to terminate this CONTRACT by giving thirty (30) days written notice to CONTRACTOR, specifying this CONTRACT to be terminated and the effective date of termination.

21.3 Upon receipt of notice of termination from COMPANY, CONTRACTOR shall forthwith perform all necessary preparatory works to exit the CONTRACT.

21.4 Upon the effective date of termination, CONTRACTOR shall ensure the following:

(a)

that the WORKS has been completely stopped; and

(b)

all CONTRACTOR‟s EQUIPMENT and CONTRACTOR‟s personnel are completely removed and demobilized from the WORK SITE(s).

Note: In the event COMPANY terminates any part of the WORKS With or Without Cause, CONTRACTOR shall stop performance of the said portion of the terminated WORKS on the effective date of termination as stipulated by COMPANY.

21.5 Additional Requirements for Termination With Cause only

- COMPANY shall retain all amounts, which are then due and payable to CONTRACTOR plus reimbursement due to CONTRACTOR for its reasonable and auditable costs incurred in the performance of the WORKS but only to the extent, such WORKS are authorised in advance by COMPANY. These costs shall be referred to herein as the “Retained Amount”.

- If the cost to COMPANY for completing the WORKS is less than the unearned balance of the CONTRACT PRICE, COMPANY shall pay the Retained Amount to CONTRACTOR. The unearned balance in this context is calculated by deducting all the paid invoices and Retained Amount from the CONTRACT PRICE.

- If the cost to COMPANY for completing the WORKS is greater than the unearned balance of the CONTRACT PRICE and is less than the Retained Amount, then COMPANY shall deduct the difference from the Retained Amount due to CONTRACTOR.

- If such difference is greater than the Retained Amount due to CONTRACTOR, CONTRACTOR shall pay to COMPANY such difference less the Retained Amount due to CONTRACTOR. Notwithstanding, COMPANY shall be entitled to recover the amount due, including any costs involved from the Bank Guarantee.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

21.6 CONTRACTOR may give notice to COMPANY to terminate the part of the WORKS suspended pursuant to ARTICLE 20 - SUSPENSION OF WORKS, provided ninety (90) calendar days have elapsed since the effective date of the said suspension and provided COMPANY has not given notice to CONTRACTOR within the said period to resume the scope of WORKS so suspended. CONTRACTOR shall then have the right to terminate the said suspended part of scope of WORKS if ten (10) calendar days have elapsed after receipt by COMPANY of the said notice without COMPANY giving notice to CONTRACTOR to resume the said suspended part of the scope of WORKS pursuant to ARTICLE 20 - SUSPENSION OF WORKS.

21.7 If either CONTRACTOR or COMPANY terminates any part of the WORKS in accordance with the provisions herein, CONTRACTOR shall execute and deliver to COMPANY all documents required by COMPANY with respect to the said part of the WORKS.

21.8 For the part of the WORKS terminated, the applicable provisions of the CONTRACT shall continue in full force and effect as to all the WORKS performed prior to the effective date of termination. For the remainder part of the WORKS, the CONTRACT shall remain in full force and effect.

21.9 If this CONTRACT, the WORKS or any part of the WORKS are suspended or terminated and if COMPANY so requests, CONTRACTOR shall immediately make every reasonable effort to procure cancellation of existing SUB-CONTRACT(s), purchase orders or other obligations entered into by CONTRACTOR with SUB- CONTRACTOR(s), suppliers or others for the performance of the WORKS upon terms satisfactory to COMPANY.

21.10 COMPANY may direct CONTRACTOR to execute and deliver to COMPANY all documents related to the CONTRACT as required by COMPANY and to take all steps necessary to fully vest in COMPANY the rights and benefits of CONTRACTOR under existing SUB-CONTRACT(s) or other obligations with SUB-CONTRACTOR(s), suppliers and others. In addition, CONTRACTOR shall do whatever is necessary to preserve and protect the scope of WORKS already in progress, to protect materials, DRAWINGS, documents, equipment and supplies in transit or at the WORK SITE and to minimise all costs to COMPANY and CONTRACTOR resulting from such termination. In the event CONTRACTOR fails to comply with the aforesaid, COMPANY may take the necessary corrective actions and may at its sole discretion deduct the costs of any such corrective actions from any monies due to CONTRACTOR without prejudice to any other rights that it may possess.

21.11 If in the performance of this CONTRACT, CONTRACTOR causes the CONTRACT to be terminated, COMPANY shall have the right hereafter to enforce the Bank Guarantee and/or Performance Guarantee.

21.12 CONTRACTOR shall, within thirty (30) days from the effective date of termination, submit its final invoice for the following:

(a)

all amounts incurred for the scope of WORKS performed up to the date of termination; and

(b)

all auditable expenses resulting directly from the termination to the extent it is authorized in advance by COMPANY.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

21.13 In the event of termination hereunder, the PARTIES shall each be released and discharged from any claims by one against the other in connection with the termination. Neither PARTY shall be liable to the other for loss of anticipated profits sustained on account of such termination.

21.14 In addition to COMPANY‟s right to terminate as may be provided herein, COMPANY shall be entitled to terminate this CONTRACT pursuant to ARTICLE 24 FORCE MAJEURE. Except for any rights and obligations accrued prior to the Force Majeure event, all rights and obligations of the PARTIES herein shall forthwith cease and neither PARTY shall have any ensuing claim, rights nor liabilities against the other PARTY resulting from such termination.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 22 AUDIT

22.1 COMPANY shall have the right of access to and audit of all CONTRACTOR's and its SUB-CONTRACTOR(s)‟ documents and records related to this CONTRACT. Such right and documents and records shall remain in force and be retained for a period of not less than six (6) years after the issuance of the NOTICE OF FINAL ACCEPTANCE of the WORKS or any termination thereof.

22.2 CONTRACTOR shall ensure that the provisions of this Article 22 are included in all SUB-CONTRACT(s) it may enter into with its SUB-CONTRACTOR(s) and AFFILIATES and suppliers who shall supply any of the labour, equipment, materials or services to be provided under this CONTRACT.

22.3 From the EFFECTIVE DATE of this CONTRACT and within the time period mentioned in Article 22.1, COMPANY shall have the right, during regular scheduled business hours, to inspect and audit the accounts including gift and entertainment records of CONTRACTOR, its SUB-CONTRACTOR(s) and AFFILIATES, which are deemed to be directly pertinent to the correctness of any invoice presented for payment for the performance of this CONTRACT, and are in compliance to the CONTRACT terms and conditions. COMPANY shall have the right to reproduce any such documents which have been inspected. Such audit may also cover the application of CONTRACTOR's rates in determining the value of WORKS performed.

22.4 COMPANY's claims for omissions, corrections or errors in charges and credits for COMPANY's account and over-payments of amount billed by CONTRACTOR and others noted above may be presented at any time during the course of the WORKS and before expiration of six (6) years after COMPANY‟s issuance of the NOTICE OF FINAL ACCEPTANCE of the WORKS or termination of the CONTRACT. A written response to COMPANY's claim for omissions, corrections or errors in charges, and credits for COMPANY's account shall be made by CONTRACTOR as soon as practicable, and in no event, later than thirty (30) working days from the date of such claims.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 23 CHANGES

23.1 Changes to the CONTRACT may be required during the CONTRACT duration (including extension(s) to the SCHEDULE OF WORKS) should be handled expeditiously and effectively by the PARTIES hereto. Such changes may include, but are not limited to amendments, additions, deletions, substitutions, alterations and modifications.

23.2 COMPANY shall have the right, at any time, to make any change but such change shall in no way affect the rights or obligations of the PARTIES hereto except as provided in a written CHANGE ORDER.

23.3 Either PARTY may request for a CHANGE ORDER, wherein it shall advise the other PARTY of the said requirement. For avoidance of doubt, COMPANY retains the right to decide on the requested CHANGE ORDER.

23.4 If COMPANY desires changes to the scope of WORKS, COMPANY may issue a Field Instruction to CONTRACTOR specifying the required action to be taken by CONTRACTOR. CONTRACTOR shall be obligated to carry out the changes. CONTRACTOR shall submit a Change Order proposal to COMPANY within fourteen (14) days or the time stipulated in the Field Instruction. The terms and conditions set out in the Change Order Proposal shall include, but not be limited to price, method of payment, earliest commencement date, and any other information deemed necessary. These changes will be priced on the basis of EXHIBIT III - SCHEDULE OF COMPENSATION. COMPANY shall have the right to specify which price schedule in of EXHIBIT III - SCHEDULE OF COMPENSATION shall apply to any requested change.

23.5 Except as provided in Article 23.6 below, CONTRACTOR shall not proceed with any change prior to receipt of a CHANGE ORDER.

23.6 When and if COMPANY approves the Change Order Proposal, COMPANY shall issue to CONTRACTOR a written CHANGE ORDER, as per EXHIBIT IV ADMINISTRATIVE PROCEDURES.

23.7 No adjustment to the SCHEDULED MECHANICAL COMPLETION DATE or CONTRACT PRICE shall be made pursuant to this CONTRACT, except by the issuance of a CHANGE ORDER by COMPANY. The CHANGE ORDER shall set forth the change in the scope of WORKS, whether increase or decrease, and the corresponding adjustment to the CONTRACT PRICE, or SCHEDULED MECHANICAL COMPLETION of this CONTRACT, and shall set forth the basis on which CONTRACTOR or COMPANY shall be compensated for the change.

23.8 If CONTRACTOR believes that any act or omission of COMPANY, such as any delay of COMPANY supplied materials, affects or shall affect the cost of or time required for the scope of WORKS, then CONTRACTOR shall promptly give written notice to that effect before proceeding with the part of the scope of WORKS in question. COMPANY shall not necessarily be bound by such notice, and in no event shall COMPANY be obligated to adjust the SCHEDULED MECHANICAL COMPLETION DATE for this CONTRACT, or CONTRACT PRICE if CONTRACTOR proceeds with that part of the WORKS in question before giving notice to COMPANY in accordance with this Article.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

23.9 CONTRACTOR on its own initiative and for good reason may submit a Field Instruction Request to COMPANY regarding a change in the WORKS or an adjustment to the SCHEDULED MECHANICAL COMPLETION DATE for this CONTRACT or CONTRACT PRICE. Good reason would include such purposes as suggesting a technical change in the CONTRACT to improve the scope of WORKS or asking for an adjustment to and the SCHEDULED MECHANICAL COMPLETION DATE, because of Force Majeure. COMPANY shall be under no obligation to issue such a Field Instruction, but may do so on its own discretion. The acceptance or rejection of the said Field Instruction Request shall not in any way relieve CONTRACTOR of its obligations in the execution of the scope of WORKS in accordance with the terms of this CONTRACT.

23.10 Adjustments to the SCHEDULED MECHANICAL COMPLETION DATE are not subject to re-negotiation, and such adjustments shall be deemed to include all cumulative effects of current and previously issued CHANGE ORDER(s).

23.11 Field Instruction and CHANGE ORDERs shall be handled in accordance with the procedures set out in EXHIBIT IV - ADMINISTRATIVE PROCEDURES.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 24 FORCE MAJEURE

24.1 An event of Force Majeure is an event beyond the control of both or either of the PARTIES. Events falling within Force Majeure shall include but are not limited to acts of God or force of nature, landslide, lightning, earthquake, flood, fire, explosion, storm or storm warning, tidal wave, tsunami, typhoon, shipwreck and perils to navigation, act of war (declared or undeclared) or foreign enemy, strike (excluding strikes, lockouts or other industrial disputes or action solely amongst employees of CONTRACTOR or its SUB-CONTRACTOR(s), act or omission of sovereign or those purporting to represent sovereign states, blockade, embargo, quarantine, public disorder, sabotage, accident, terrorism, declaration of state of emergency, nuclear explosion, expropriation, moratorium, radioactive or chemical contamination or coup de tat or any events beyond the control of the PARTIES or either of them.

24.2 Force Majeure shall exclude the following events:-

(a)

late delivery of materials and equipment caused by congestion at CONTRACTOR‟s plant or elsewhere, an oversold condition of the market, inefficiencies, or similar occurrences; or

(b)

late performance by CONTRACTOR and/or its SUB-CONTRACTOR(s) caused by unavailability of equipment, supervisors, or labour, inefficiencies or similar occurrences; or

(c)

mechanical breakdown of any item of CONTRACTOR‟s EQUIPMENT or its SUB-CONTRACTOR(s)‟ equipment, plant, or machinery; or

(d)

financial distress of CONTRACTOR or its SUB-CONTRACTOR(s).

24.3 In the event of Force Majeure, neither the failure nor omission of COMPANY or CONTRACTOR to perform their obligations under this CONTRACT shall be treated as failure or omission to comply with this CONTRACT.

24.4 Upon the occurrence of any Force Majeure event, the PARTY so affected in the discharge of its obligation shall as soon as reasonably practicable give written notice of such event to the other PARTY. For avoidance of doubt, any declaration of Force Majeure shall be within the exclusive discretion of COMPANY, if in the opinion of COMPANY, CONTRACTOR is prevented from performing its obligations under this CONTRACT.

24.5 The affected PARTY shall make every reasonable effort to remove or remedy the cause of such Force Majeure and mitigate its effects as quickly as may be possible.

24.6 If either PARTY considers the event of Force Majeure to be of such severity or that the Force Majeure eventhad continued for a period of thirty (30) days that it effectively frustrates the original intention of this CONTRACT, then COMPANY may suspend the CONTRACT as per ARTICLE 20 - SUSPENSION OF SCOPE OF WORKS or the PARTIES may agree that this CONTRACT is terminated with cause as per ARTICLE 21.7.

24.7 In the event of Force Majeure, CONTRACTOR shall not be entitled to any compensation for suspension caused by Force Majeure.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

24.8 For avoidance of doubt, any delay or failure in performance by either PARTY herein shall not constitute a default hereunder or give rise to any claims for damages or loss of anticipated profits.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 25 CONFLICT OF INTEREST

25.1 CONTRACTOR shall exercise care and diligence to prevent any actions being taken or conditions from arising which could result in a conflict with COMPANY‟s best interests. This obligation shall apply to the activities of the employees and agents of CONTRACTOR in their relations with COMPANY‟s employees and their families, or with SUB-CONTRACTOR(s) and third parties, arising from this CONTRACT or related to the performance of the SCOPE OF WORKS hereunder.

25.2 CONTRACTOR's efforts shall include, but not be limited to, establishing precautions to prevent its employees, officers or agents from making, receiving, providing, or offering gifts, entertainment, payments, loans, or other considerations for the purpose of influencing individuals to commit acts contrary to COMPANY‟s best interest.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 26 INTELLECTUAL PROPERTY RIGHTS

26.1 CONTRACTOR agrees to indemnify and hold COMPANY harmless against all losses, claims, demands, proceedings, costs, damages, charges, and expenses that may arise by reason of any actual infringement of any patent, design, or trademark or violation of process or other protected rights of any person or entity in the performance of the WORKS hereunder, or by reason of the manner in which the same is performed, or through the use by CONTRACTOR and/or CONTRACTOR‟s personnel of any patented article or device. CONTRACTOR is given prompt notice of such proceeding, is accorded full control of the defence settlement or compromise thereof, and COMPANY has furnished CONTRACTOR on request, all needed information, assistance and authority to enable CONTRACTOR to so defend. The provision of this Article 26 shall not apply to infringement caused by the SPECIFICATIONS furnished by COMPANY, the use of any of the equipment in combination with other materials, or in the practice of any process or infringement by reason of such use.

26.2 The indemnities set forth in this Article shall include without limitation all penalties, awards, and judgments; all court and arbitration costs; attorney's fees; and other reasonable expenses associated with such claims, demands, and causes of action. A PARTY covered by such indemnities and accused of patent infringement by a third party shall promptly notify the indemnifying PARTY and shall have the right at its own expense to participate in its own defense with attorneys of its own selection.

26.3 Notwithstanding anything to the contrary contained herein, in the event that the CONTRACTOR (or its parent, subsidiary or other affiliated or related entity) owns copyrights, patents or trade secrets, or has filed patent applications, with respect to any technology related to the services, products or equipment furnished by CONTRACTOR hereunder, and if CONTRACTOR makes any improvement on or to such technology, or develops new technology or inventions, then CONTRACTOR shall own all such technology, inventions, improvement, including DRAWINGS, SPECIFICATIONS, calculations and other documents provided such technology, invention or improvements do not directly embody COMPANY‟s confidential information.

26.4 CONTRACTOR shall ensure that any SUB-CONTRACT(s) between CONTRACTOR and its SUB-CONTRACTOR(s) or suppliers contain provisions similar to this Article.

26.5 CONTRACTOR shall disclose promptly to COMPANY all inventions, discoveries, and improvements (whether patentable or not) conceived or made by CONTRACTOR‟s personnel, either alone or jointly with others, and which are based on the technical information provided to CONTRACTOR by COMPANY in the course of the WORKS. CONTRACTOR shall assign and require its personnel to assign to COMPANY, each such invention, discovery, and improvement. CONTRACTOR shall require its employees to execute such papers as COMPANY requests in connection with the assignment or prosecution of patents or patents applications covering each such invention, discovery, or improvement in all countries specified by COMPANY at COMPANY‟s own cost and to render reasonable assistance to COMPANY in connection with protecting COMPANY‟s right to such invention, discovery or improvement.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

26.6 CONTRACTOR agrees to reimburse COMPANY for any royalties, licensing fees or other similar payments that COMPANY shall be obligated to pay by virtue of the use by CONTRACTOR of any such protected rights unless such costs have been specifically agreed in writing to be borne by COMPANY. CONTRACTOR shall obtain a patent indemnity, if obtainable, for any items manufactured or supplied by others for the benefits of COMPANY.

26.7 CONTRACTOR hereby grants to COMPANY and its successors an irrevocable, royalty-free, worldwide, transferable, non-exclusive license under all patent and know-how rights now or hereafter owned or controlled by CONTRACTOR to make, use, sell, operate, maintain, repair, re-construct, alter or modify the Scope of the WORKS in whole or in part

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 27 WAIVERS

27.1 The failure of COMPANY, at any time, or from time to time to enforce, or to require the strict adherence and performance of any of the terms and conditions of this CONTRACT, to exercise any option, right, or privilege hereunder, or to demand compliance as to any obligation or covenant, shall not constitute a waiver of any such terms and conditions and/or affect or impair such terms or conditions in any way, or the right, privilege, or option of COMPANY, or of the strict performance of CONTRACTOR thereof unless an express and specific waiver is properly executed and evidenced in writing by COMPANY.

27.2 Waivers by COMPANY of any breach or non-observance by CONTRACTOR of any of the terms and conditions of this CONTRACT shall not constitute or be construed as a waiver of any succeeding breach or non-observance of the same or any other terms or conditions.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 28 CONFIDENTIALITY

28.1 CONTRACTOR shall obtain written APPROVAL from COMPANY prior to disclosing or making any publicity release, public statements or announcement, by way of press or other media, regarding this CONTRACT.

28.2 CONTRACTOR shall at all times hold confidential all information pertaining to this CONTRACT, which is not already part (unless through the breach of CONTRACTOR of its confidentiality obligations hereunder) of the public domain.

28.3 CONTRACTOR shall ensure that the provisions of this Article are adhered to by its employees, agents, vendors, suppliers and their employees, its SUB- CONTRACTOR(s)‟ and SUB-CONTRACTOR(s)‟ employees and shall promptly notify COMPANY upon discovery of any instances where any of the requirements of this Article have not been complied with.

28.4 Upon receipt by CONTRACTOR of COMPANYs notification of termination, CONTRACTOR shall return to COMPANY all documents, DRAWINGS and data provided to CONTRACTOR by COMPANY.

28.5 This Article shall continue in force notwithstanding the completion or earlier termination of this CONTRACT.

28.6 CONTRACTOR shall not, without COMPANY's prior written APPROVAL, divulge to third parties or use in any way other than for accomplishing completion of the WORKS or for purposes other than that specified in the CONTRACT, any technical information or any processes, process data or calculations or any DRAWINGS or designs showing the equipment, devices and machinery by which the processing is to be performed or carried out, disclosed, directly or indirectly, to CONTRACTOR

28.7 The provisions of this Article shall not apply:

(a)

insofar as any of the documents, DRAWINGS, and data referred to in the Scope of WORKS are part of public knowledge or literature at the date of their receipt by CONTRACTOR as from such date;

(b)

insofar as any of the documents, DRAWINGS, and data referred to in the Scope of WORKS become part of public knowledge or literature after the date of their receipt by CONTRACTOR as from such subsequent date;

(c)

insofar as any of the documents, DRAWINGS, and data are developed by CONTRACTOR independently of the CONTRACT;

(d)

insofar as any of the documents, DRAWINGS, and data lawfully becomes known or available to CONTRACTOR from a third party who is not under a similar agreement, directly or indirectly, with COMPANY hereto; and

(e)

where disclosure is required to be made in order to comply with the requirements of any law, rule or regulation of any governmental or regulatory body having jurisdiction over the Scope of WORKS or CONTRACTOR, or of any relevant stock exchange.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 29 ARBITRATION

29.1 Any dispute between the PARTIES as to the performance of this CONTRACT or the rights or liabilities of the PARTIES herein, or any matter arising out of the same or connected therewith, which cannot be settled amicably shall be referred to the higher management of the PARTIES before reference is made to arbitration in accordance with the Rules of the Kuala Lumpur Regional Centre for Arbitration before a board of three (3) arbitrators.

29.2 Each of the PARTIES hereto shall be entitled to appoint one (1) arbitrator and the two (2) arbitrators shall agree on a third arbitrator. In the event agreement on the third arbitrator cannot be reached, the third arbitrator shall be appointed by the Director for the time being of the Kuala Lumpur Regional Centre for Arbitration.

29.3 It is agreed, however, that no one who is an employee of either PARTY or who is in anyway financially interested in this CONTRACT shall be appointed to act as an arbitrator.

29.4 Such arbitration shall be held in the English language at Kuala Lumpur, Malaysia. The award of the arbitrators shall be final and binding upon the PARTIES. The costs of the arbitration shall be borne by the PARTY whose contention was not upheld by the arbitration tribunals, unless otherwise provided in the arbitration award.

29.5 Notwithstanding the foregoing, the PARTIES may agree that any particular matter of dispute can most expeditiously be settled by an EXPERT. In that event, the PARTIES shall jointly prepare and sign a statement on the issue to be determined by the EXPERT before agreeing upon the appointment of the EXPERT. The PARTIES shall stand by the decision of the EXPERT on that issue described which shall be final and binding on the PARTIES without further arbitration on that issue. If PARTIES cannot agree upon the person of the EXPERT within fourteen (14) days after the date the last PARTY signs the aforesaid statement of the issue, then the dispute shall be referred to arbitration as indicated above.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 30 GOVERNING LAWS AND LANGUAGE

30.1 In the performance of this CONTRACT, CONTRACTOR and its SUB- CONTRACTOR(s) shall be subject to all applicable laws in the country where the WORKS are being executed. For the purpose of this Article, "laws" includes any laws (national, state, municipal, local or others) and any requirements, acts, enactments, ordinances, byelaws, rules or regulations of any relevant authority or agency (national, state, municipal, local or other).

30.2 CONTRACTOR shall, at CONTRACTOR‟s own expense, defend, indemnify and hold COMPANY harmless from all forms of penalty which may be imposed on COMPANY by reason of any alleged violation of law by CONTRACTOR or its SUB- CONTRACTOR(s) and also from all claims, suits, or proceedings that may be brought against COMPANY arising under or by reason of the performance of this CONTRACT with respect to such alleged or violation of law whether brought by employees of CONTRACTOR or its SUB-CONTRACTOR(s) or by third parties or by any relevant authority.

30.3 CONTRACTOR‟s obligations under this Article shall include, without limitation, obtaining all necessary or appropriate import licenses, customs clearances or permits wherever applicable.

30.4 If CONTRACTOR or its SUB-CONTRACTOR(s) perform any part of the scope of WORKS hereunder in breach of the law, then CONTRACTOR shall bear any additional costs resulting from the said violation and correction thereof. CONTRACTOR shall not enter into negotiations with any relevant authority or agency to develop acceptance to exemption, composition, variation, or revision to law in connection with this CONTRACT without COMPANY‟s prior written APPROVAL.

30.5 The PARTIES irrevocably agree to submit to the exclusive jurisdiction of the courts of country where the WORKS are being carried out.

30.6 All documents produced by any of the PARTIES in the performance of this CONTRACT as well as all written communications of the PARTIES are to be written in the English language, which is hereby, the designated governing language of the CONTRACT. COMPANY and CONTRACTOR may use any language within their own organizations, except that all SUB-CONTRACT(s) and all written communications pertaining to them shall be in English.

30.7 CONTRACTOR shall be responsible for and shall bear all the costs of obtaining all necessary licenses, permits and authorisation required by law that must be obtained in CONTRACTOR‟s name from the relevant governmental authorities for CONTRACTOR to do business in the country, or countries wherein any part of the scope of WORKS WORKS is performed, and shall give all required notices.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 31 ENTIRE AGREEMENT

31.1 This CONTRACT constitutes the entire agreement between the PARTIES and supersedes all prior negotiations, representations or agreements related to this CONTRACT, either written or oral, including COMPANY‟s bid document and CONTRACTOR's proposals, except to the extent they are expressly incorporated into this CONTRACT. No changes, alterations, or modifications to this CONTRACT shall be effective unless in writing, and executed by the authorized signatories of COMPANY and CONTRACTOR.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 32 NON-EXCLUSIVE AGREEMENT

32.1 This CONTRACT is non-exclusive and COMPANY reserves the right to engage other contractors to perform similar or identical scopes of WORKS and/or supply similar or identical goods at any time during the duration of this CONTRACT.

32.2 CONTRACTOR shall afford such other contractors adequate opportunity to carry out their contracts and shall accomplish the Scope of WORKS in co-operation with those contractors and with COMPANY.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 33 SUB-CONTRACTING AND ASSIGNMENT

33.1 CONTRACTOR shall not subcontract nor assign any or all of its rights and/or obligations under the CONTRACT or any part thereof without COMPANY‟s prior written APPROVAL, the APPROVAL of which shall not be unreasonably withheld except for assignment at the Production Sharing Contract level, which is subject to PETRONAS‟ approval only. SUB-CONTRACT documents and selection of SUB- CONTRACTOR(s) related to the scope of WORKS or any part thereof shall require the written APPROVAL of COMPANY prior to award of each SUB-CONTRACT. APPROVAL granted shall not release nor relieve CONTRACTOR of any of its obligations under the CONTRACT or create any contractual relationship between any SUB-CONTRACTOR(s) and COMPANY.

33.2 CONTRACTOR shall be fully responsible for any acts, defaults, and omissions of any SUB-CONTRACTOR(s), and persons either directly or indirectly employed by the SUB-CONTRACTOR(s), to the same extent as it is for the acts and omissions of persons directly or indirectly employed by CONTRACTOR. CONTRACTOR shall not bind or purport to bind COMPANY in the SUB-CONTRACT in any manner.

33.3 COMPANY may assign this CONTRACT, including all rights and obligations hereunder, to PETRONAS or any of its AFFILIATES, or any contractor of PETRONAS, performing work in the WORK SITE(s) at any time with prior written notification to CONTRACTOR.

33.4 CONTRACTOR shall ensure that all COMPANY‟s rights under this CONTRACT including audit rights are incorporated in all CONTRACTOR's SUB-CONTRACT(s) hereunder. For avoidance of doubt but not by way of limitation, CONTRACTOR shall, in all SUB-CONTRACT(s), include the following provisions:

(a)

the option of immediate termination of the SUB-CONTRACT(s);

(b)

the option of immediate suspension of the SUB-CONTRACT(s);

(c)

all rights and remedies available to COMPANY in the CONTRACT; and

(d)

all of the general duties and obligations CONTRACTOR is required to fulfil as provided for in the CONTRACT.

33.5 Any purported SUB-CONTRACT or assignment without the written APPROVAL of COMPANY shall be absolutely void against COMPANY and COMPANY shall in such event have no obligation whatsoever to the purported SUB-CONTRACTOR or assignee.

33.6 Where COMPANY's written APPROVAL has been obtained, CONTRACTOR shall ensure that all of COMPANY‟s rights under the CONTRACT, including audit, patent and other property rights, indemnities and all the requirements in the CONTRACT, (including but without limitation any confidentiality undertaking and a prohibition on assignment and/or Sub-contracting without written APPROVAL of COMPANY) are incorporated in all CONTRACTOR‟s SUB-CONTRACTs. CONTRACTOR shall submit to COMPANY all documents relating to the SUB-CONTRACTs and assignments.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

33.7 COMPANY shall have the right to disapprove any SUB-CONTRACTOR(s), suppliers, vendors or source of supply selected by CONTRACTOR, for cause, which includes not having PETRONAS‟ license and/or unsatisfactory past performance on similar scope of WORKS.

33.8 COMPANY shall have the right to attend as it deems fit any progress and/or other meetings where it involves technical discussions or otherwise between CONTRACTOR and its SUB-CONTRACTOR(s).

33.9 CONTRACTOR shall within thirty (30) days after CONTRACT award and/or within fourteen (14) days from the date of COMPANY's request provide a list of all SUB- CONTRACTOR(s), vendors and suppliers to be utilised by CONTRACTOR in fulfilling its obligations under this CONTRACT.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 34 - PROCUREMENT OF EQUIPMENT, FACILITIES, GOODS, MATERIALS, SUPPLIES AND SERVICES

34.1 In respect of CONTRACTOR‟s supplied material and equipment, CONTRACTOR shall purchase or otherwise provide all materials, equipment, and services that it is responsible for procuring or providing. All CONTRACTOR supplied materials and equipment, if obtained directly from foreign source, shall be imported in CONTRACTOR's name.

34.2 CONTRACTOR shall procure materials, equipment, and services only from sources APPROVED by COMPANY. Sources include manufacturers, vendors, suppliers, agencies, SUB-CONTRACTORS, and others who supply materials, equipment, or services for the FACILITIES. Additionally, CONTRACTOR shall make arrangement for appropriate use of technical representatives of its sources during the execution of the WORKS.

34.3 All materials and equipment for the WORKS shall be new and unused, unless otherwise APPROVED by COMPANY in writing. CONTRACTOR shall procure materials and equipment from financially sound and reputable vendors and suppliers with proven experience and track record and shall take into consideration quality, delivery, reliability, services and inventory management. CONTRACTOR shall carry out a technical tender evaluation for all materials and/or equipment purchased by CONTRACTOR. CONTRACTOR shall submit a copy of the unpriced purchase order for COMPANY‟s review.

34.4 CONTRACTOR shall be responsible for the source inspection and expediting of all materials and equipment that CONTRACTOR is responsible for procuring and which is to be incorporated into the WORKS.

Source inspection means INSPECTION AND TESTING of the materials and equipment to be incorporated into the WORKS at the point of manufacture and assuring that such materials and equipment meet the requirements of the SPECIFICATIONS and ensure that such manufacturing activity until the time of planned delivery do not hinder the required delivery date as specified in the purchase order. CONTRACTOR shall arrange and coordinate all source inspections according to the detailed requirements and procedures set forth in COMPANY‟s SPECIFICATIONS, pre-accepted procedures and as referred to in ARTICLE 44 - INSPECTION. CONTRACTOR shall submit within thirty (30) days after CONTRACT award the list source inspection requirements for CONTRACTOR supplied materials and equipment for COMPANY‟s review and APPROVAL.

Expediting means effort and follow-up action to ensure that activities progress as planned with no hindrance or potential hindrance to the agreed work schedule or the CONTRACT SCHEDULE OF WORKS.

34.5 CONTRACTOR shall obtain prior written APPROVAL from COMPANY for all material and equipment substitution and/or design modification on the DRAWINGS. The request shall be supplemented with design checks and reasons for any such materials and equipment substitution and design modification.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

34.6 CONTRACTOR shall be responsible for the freight forwarding, transportation, clearance through Customs Authority, timely arrival at the WORK SITE or other appropriate destinations, unloading and handling of all materials and equipment that CONTRACTOR purchases and provides for the WORKS. CONTRACTOR shall be liable at CONTRACTOR‟s own expenses, for the repair or replacement of any damage or discrepancy found on the materials and equipment that CONTRACTOR purchases and provides for the WORKS.

34.7 COMPANY shall advise CONTRACTOR on the delivery of COMPANY‟s supplied materials to the WORK SITE or at CONTRACTOR‟s wharf. CONTRACTOR shall ensure that transportation, unloading, storage and preservation of such materials is performed safely and in accordance with the manufacturer‟s requirements and shall verify that such materials and equipment or any parts thereof are free from any defect. Except for any discrepancy noted prior to unloading by CONTRACTOR shall be responsible for any damage sustained during the unloading and shall assume responsibility for the care and custody of the materials and equipment received and stored at WORK SITE. CONTRACTOR shall be liable, at CONTRACTOR‟s own expenses, for the repair or replacement of any damage or discrepancy found on the materials and equipment or any part thereof while they are in CONTRACTOR‟s custody.

34.8 CONTRACTOR shall ensure that such materials and equipment, regardless of who supplied them, are properly stored and preserved in accordance with the manufacturer‟s recommendation or STANDARD acceptable in the industry, and shall ensure that the materials and equipment are and remain free from contaminants.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 35 NOTICES

35.1 All notices to be given, submitted or made hereunder shall be in writing and made to either PARTY and shall be deemed to have been properly given or made to the PARTY it is addressed to if the notices are sent (by registered mail, courier service or facsimile) to the respective PARTY at the address as per EXHIBIT IV - ADMINISTRATIVE PROCEDURES.

35.2 The date of any notice shall be either the date it is first delivered at the office of the addresser, or the date it is first received by the addressee, whichever is earlier. Written notice or instruction shall be deemed to have been received:

If delivered by hand

-

At time of delivery to either PARTY

If sent by fax

-

At time of transmission

If sent by registered mail

-

At time of receipt or recorded delivery.

35.3 If the time of such deemed receipt of notice is not during customary hours of business, notice shall be deemed to have been received at 10:00 a.m. on the first customary day of business thereafter.

35.4 Either PARTY may change the person or address to which notice shall be sent by giving the other PARTY written notice of such change.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 36 SURVIVAL

36.1 Notwithstanding anything to the contrary, the obligations of COMPANY and CONTRACTOR in this CONTRACT in relation to ARTICLE 7 INVOICING AND PAYMENTS, ARTICLE 10 WARRANTY, ARTICLE 18 LIABILITIES AND INDEMNITIES and ARTICLE 28 - CONFIDENTIALITY shall survive expiration or termination of this CONTRACT.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 37 SEVERABILITY

37.1 If any articles of this CONTRACT is held to be illegal or is invalid under any laws or regulations, such articles shall be fully severable and this CONTRACT shall be construed as if such illegal or invalid articles had never comprised as part of this CONTRACT and the remaining provisions of this CONTRACT shall remain in full force and effect and shall not be affected by the illegal or invalid provisions or by its severance from this CONTRACT.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 38 LIQUIDATED DAMAGE

38.1 The time stipulated for the performance of the scope of WORKS is the essence of this CONTRACT. CONTRACTOR agrees to affect performance of the Scope of WORKS and mobilize its personnel and equipment so as to be able to complete the WORKS on or before the stipulated completion/ delivery date as stated in the Scope of WORKS. If the forecast or actual mobilization of CONTRACTOR‟s resources or equipment shall be delayed, CONTRACTOR shall immediately notify COMPANY in writing, giving justifications for such delay or potential delay identifying fully its proposed corrective measures for COMPANY‟s APPROVAL.

38.2 Delays and Extension of Time

Immediately upon it becoming reasonably apparent that the progress of the WORKS is or will be delayed, CONTRACTOR shall forthwith give written notice to COMPANY REPRESENTATIVE, as to the causes of delay or potential delay and relevant information with supporting documents enabling COMPANY REPRESENTATIVE to form an opinion as to the cause and calculation of the length of delay. If in the opinion of COMPANY REPRESENTATIVE the completion of the WORKS is likely to be delayed or has been delayed beyond the date of completion or beyond the extended date of completion previously fixed under this clause due to any one or more of the following events:

(a)

Force Majeure as provided under ARTICLE 24 FORCE MAJUERE,

(b)

exceptionally inclement weather; or

(c)

for any other reasons as deemed fit by COMPANY.

In such case COMPANY REPRESENTATIVE may, if he is of the opinion that extension of time should be granted, as soon as he is able to estimate the length of the delay beyond the date or time aforesaid, issue a Certificate of Delay and Extension of Time, giving a fair and reasonable extension of time for completion of the WORKS.

Provided always that CONTRACTOR has taken all steps to avoid or mitigate such delay and shall do all that may be required and COMPANY REPRESENTATIVE is satisfied with the steps taken by CONTRACTOR to avoid or mitigate such delay.

Provided further that any extension of time granted herein Article 38.2 shall not result in any increase in the CONTRACT PRICE.

38.3 If CONTRACTOR fails to complete, inspect and test the WORKS or any part of the WORKS on or before the SCHEDULED MECHANICAL COMPLETION DATE as stipulated in EXHIBIT II SCHEDULE OF WORKS then as agreed damages to COMPANY for such delay, and in the absence of legal excuse, pursuant to this CONTRACT, the CONTRACT PRICE shall be reduced 0.33% of the CONTRACT PRICE per day for each day of delay up to maximum of 10% of the CONTRACT PRICE.

38.4 Not Applicable

38.5 Not Applicable

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

38.6 Further, CONTRACTOR and COMPANY agree that the total amount of liquidated damages payable by CONTRACTOR to COMPANY under this Article shall not exceed ten percent (10%) of the CONTRACT PRICE. In the event that the total amount of Liquidated Damages accrued equals the maximum amount contemplated in the CONTRACT, COMPANY reserves its right to terminate the CONTRACT.

38.7 Not Applicable

38.8 If the total amount of Liquidated Damages accrued equals the maximum amount contemplated in the CONTRACT, COMPANY reserves its right to terminate the CONTRACT.

38.9 The amount of Liquidated Damages shall be deducted from payments due to CONTRACTOR pursuant to this CONTRACT and shall be converted to the currency in which CONTRACT PRICE is stated at the rate of exchange prevailing on the day of such payments per Article 7.10.

38.10 Due to the difficulty of ascertaining the exact amount of damages that COMPANY shall incur by reason of such delay CONTRACTOR and COMPANY hereby agree that the aforementioned amount of liquidated damages are a fair and reasonable pre- agreed estimation of the accruing losses to COMPANY.

38.11 COMPANY may, without prejudice to any other method of recovery, deduct the amount of such liquidated damages from any payment due to or which may become due to CONTRACTOR. The deduction of such damages shall not relieve CONTRACTOR from its obligations and liabilities under this CONTRACT.

38.12 The payment of liquidated damages is in addition to and not in lieu of or substitution for any other remedy that may be available to COMPANY in the event of delay in completion of the WORKS in accordance with EXHIBIT II - SCHEDULE OF WORKS

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 39 CONTRACT CLOSURE

39.1 COMPANY shall submit to CONTRACTOR for execution, a CONTRACT CLOSURE CERTIFICATE, in the form attached as per EXHIBIT IV ADMINISTRATIVE PROCEDURES, CONTRACT CLOSURE CERTIFICATE, stating that CONTRACTOR have been paid in full, for the SCOPE OF WORKS done and all related debts, taxes, liens, privileges, claims, charges, and obligations in connection with the performance of the SCOPE OF WORKS. CONTRACTOR shall execute the aforementioned CONTRACT CLOSURE CERTIFICATE within fourteen (14) days from receipt of the aforementioned notification by COMPANY for execution of the CONTRACT CLOSURE CERTIFICATE.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 40 - TRANSFER OF TITLE AND RISK OF LOSS

40.1 Except for goods leased or rented, all goods including but not limited to all raw data, field logs, documents, reports, DOCUMENTATION or DRAWINGS and calculations covered by this CONTRACT in respect of the completion of the WORKS and each part thereof, and everything intended for incorporation therein, shall, as soon as they are delivered in accordance to the delivery terms, or appropriated to the WORKS be the sole and unencumbered property of COMPANY.

40.2 CONTRACTOR hereby waives any liens or claims, which it might have at any time on or against any goods, raw data, field logs, documents, reports, DRAWINGS and calculations, which are to be incorporated into the Scope of WORKS.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 41 - ENGINEERING CODES AND STANDARDS

41.1 The codes and STANDARDS which apply to the scope of WORKS covered by this CONTRACT are listed in the SPECIFICATIONS. These codes and STANDARDS may be revised from time to time by COMPANY, wherein COMPANY shall notify CONTRACTOR and it shall be CONTRACTOR's responsibility to ensure that the latest revisions to these codes and STANDARDS are being adhered to. Any difference in these codes and STANDARDS and revisions shall be immediately notified in writing to COMPANY.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 42 - VENDOR DATA REQUIREMENTS AND SUBMITTAL

42.1 DRAWINGS and vendor data are to be submitted in strict compliance with the SPECIFICATIONS. If for any reason, the transmission of DRAWINGS and vendor data shall be delayed, COMPANY is to be informed immediately in writing, giving reason for such delay. All DRAWINGS and vendor data shall be delivered to COMPANY by hand or through courier service.

TENDER NO: CHO/2013/DPG/0003 PROVISION OF PROCUREMENT AND CONSTRUCTION (PC) FOR OFFSHORE PIPELINE TIE-IN SKID (PLTS) FOR EVACUATION NORTH MALAY BASIN GAS DELIVERY SYSTEM (ENGDS) PROJECT

ARTICLE 43