C311333- Amal HRSG -1 Project

Petroleum Development Oman LLC

Contract Number C311333Amal Heat Recovery Steam Generator (HRSG)-1 ProjectSection C5

Schedule of Rates

Section C5

Schedule of Rates

Contents

Schedule A Pricing Preambles

Schedule B Lump-sum Work

Schedule C Not Appicable

Schedule D Alterations & Day-works

Schedule E Milestones

Schedule F Penalties and Incentives

Section C5 - Schedule 'A':- Pricing Preambles

2Schedule A Pricing Preambles

2Schedule B Lump-sum Work

2Schedule C Not Appicable

2Schedule D Alterations & Day-works

2Schedule E Milestones

2Schedule F Penalties and Incentives

3Section C5 - Schedule 'A':- Pricing Preambles

4Schedule 'A':- Pricing Preambles

41General Terms

41.1All Inclusive Contract Price and Rates

41.2Pricing of Schedules

51.3Working Hours for Site

51.4Company Permits, Rules and Procedures

51.5Company Supplied Materials

51.6Consumables

52Lump Sum Work (Schedule 'B')

52.1Descriptions for Identification Only

62.2Addition and Omission of Work

62.3Commissioning Periods

63Provisional and Optional Works (Schedule 'C')

64Alterations & Day-work Rates (Schedule 'D')

64.1General

64.2Analogous Rates

64.3Day-work Rates

84.4Additional Services Procured At Day-work Basis

84.5Materials Procurement

94.6Authorisation & Payment

95Terms of Payment

95.1Milestones Payments (Schedule E)

95.2Payments

95.3Completion of the Work (MS 10)

105.4Bonuses & Penalties

106Contractor's Accommodation & Facilities

106.1Accommodation

117Company Provided Services

117.1Company Provided Services

117.2Logistics Service Provider (LSP)

117.3Provision of Air Passenger Services

Schedule 'A':- Pricing Preambles

1 General Terms

1.1 All Inclusive Contract Price and Rates

1.1.1 Contractor shall include in the Contract Price and Rates for executing the whole of the Work specified or reasonably inferred from the Contract.

1.1.2 The Contract Price and Rates entered shall be deemed to be the fully inclusive cost for the Work and shall include but not be limited to: -

a) Direct and indirect labour, wages, overtime, bonus, transportation, importation, exportation, messing, travelling, housing, training, holidays, pensions, insurance, welfare, allowances, sick pay, protective clothing, safety equipment, other payments, contributions, taxes, levies or expenses payable in respect of labour as applicable under and in accordance with law, safety, health, welfare.

b) Administration, agents fees, management, telephone, fax, communication supervision costs, setting out, investigation, expenses, site and head office overheads, control, protection, as built records and information, financing costs, repairs.

c) Co-operation with other contractors, third parties, local establishments, Walis, municipality, government agencies, etc.

d) Establishment costs, services, stores, industrial facilities, workshops, fences, watching, lighting, safety, security, maintenance, latrines, messing facilities, accommodation, electricity, air, gas, water, fuel oil, grease cleaning and clearing up at all times.

e) Plant, machinery, equipment, fuel, lubricants, tools, temporary supports, hoisting and lifting equipment, staging and weather protection, scaffolding, shelters, transport, haulage.

f) Materials, consumables, water, safe storage, fixing in place, samples, testing, cleaning, waste, handling and multiple handling, duties.

g) Other insurance, liabilities, obligations, responsibilities and risks arising out of the General Conditions for Construction Contracts and all other documents forming the Contract.

h) Profit and overheads.

1.2 Pricing of Schedules

1.2.1 Contractor shall be paid in accordance with the Schedule of Rates for Work performed and services provided.

1.2.2 All Rates shall be in OMR (Omani Rial) and shall remain fixed for the duration of the Contract.

1.2.3 Rates shall be inserted against all items in the Schedules that have a monetary value. The value of items left un-priced shall be deemed to be included in the Contract Price. Should the Work or obligations given in such items not be carried out by Contractor, Company shall deduct amounts for the Work not completed valued in accordance with the Contract.

1.3 Working Hours for Site

1.3.1 Contractor shall include for working normal Company hours:-

Interior locations - 07.00 to 18.00, 1-hour Lunch break, seven days a week

Coastal Areas - 07.00 to 16.00, 1-hour Lunch break, Saturday to Wednesday inclusive

1.3.2 Should Contractor require to work outside these hours then prior agreement must be sought from Company and no additional payment will be made.

1.3.3 Contractor is to allow in the Contract Price for continuous working during all periods where Company's existing production facilities require to be "shut-down" or temporarily out of operation whilst the Work is executed.

1.4 Company Permits, Rules and Procedures

1.4.1 All Work executed by Contractor shall include due allowance for complying with Company permit procedures, rules and regulations.

1.4.2 Contractor shall include for all necessary requirements for obtaining approvals under Company's Permit to Work Procedure (PTW).

1.4.3 Where Contractor can identify cost savings resulting from a relaxation in a particular PTW requirement, Contractor shall submit such proposals together with an evaluation of the proposed savings to Company for approval. Any relaxation in PTW requirements shall subject to written approval by Company and will only apply to the stipulated areas of the Work.

1.5 Company Supplied Materials

1.5.1 Company shall provide Contractor with only those Materials specifically stated as such in Section C4, Scope of Work. Contractor shall include in the Contract Price for supply of all other temporary and permanent Materials required to complete the Work. Prices for installing Company supplied Materials shall include for making good any loss, faults or damages which occur after Contractor has taken delivery, received or accepted them as being in good condition.

1.5.2 Company supplied Materials for certain items shall contain an allowance for normal waste and Contractor shall be deemed to have allowed for handling these excess quantities and returning any unused Materials to Company nominated storage area as stated in Section C4, Scope of Work.

1.5.3 Company supplied Materials shall be handed over to Contractor at the location as stated in Section C4, Scope of Work or other locations as directed by Company. Contractor shall allow in his prices for handling, loading, crainage, storage, compliance with Materials procedures, issuing of damage/deficiency reports, issue and transporting Materials to their final location.

1.6 Consumables

1.6.1 Contractor shall provide all consumables required to complete the Work unless specifically stated otherwise.

1.6.2 For the purposes of this Contract, consumables are considered to be, items necessary to complete the Work, but which do not actually form part of the as installed equipment, this shall include, but not be limited to; welding rods, fluxes, grease, gases, incidental non-specialist lubricants, oils, refrigerants, cleaning agents, corrosion inhibitors, solvents, rags, application equipment, disposable protection and clothing.

2 Lump Sum Work (Schedule 'B')

2.1 Descriptions for Identification Only

2.1.1 The descriptions attached to the various items are intended as brief summary of the Work involved. They are sufficient for identification only and not an exhaustive list detailing every operation involved in carrying out the Work. The descriptions have been prepared on the basis that Contractor is experienced in the requirements of the Work to be executed and has full knowledge of the Site.

2.1.2 Notwithstanding any omission from the descriptions given in Schedule B of any operation included within Section C4 Scope of Work and Section C6 Technical Specification and Drawings, the cost of all operations that may be ascribed to the Work shall be included in the Contract Price. All Work that can be reasonably ascribed to an item description shall be deemed to be included with that item. No liability will be accepted by Company for defective description or further operations, other than those described, being required to complete the Work.

2.1.3 Contractor shall include in his Contract Price for excavating in whatever ground conditions may be found. Contractor shall include a separate line item in the price schedule for excavating entirely by hand within the confines of the Site or wherever Company may deem mechanical excavation to be unacceptable.

2.2 Addition and Omission of Work

2.2.1 Where an addition or omission of Work can be clearly identified within the descriptions included in Schedule B - Lump Sum Work, the amounts stated against these descriptions shall be deemed the value of such Work. In the event that such clear identification cannot be established then the addition or omission of such work shall be valued in accordance with paragraph 4.0 herein.

2.3 Commissioning Periods

2.3.1 Contractor shall include in the Rates for maintaining on Site, during the duration of Commissioning Work, all facilities required until Completion of the Work. This shall include but not be limited to contract administration, trade & Site supervision, accommodation, messing, transport and communication for all required labour to support the Commissioning activities.

3 Provisional and Optional Works (Schedule 'C')

Not Applicable

4 Alterations & Day-work Rates (Schedule 'D')

4.1 General4.1.1 The Rates contained in Schedule 'D' shall be used to evaluate modifications, omissions and/or additions to the Work requested by Company prior to the Completion Date. All quantities and rates, except where otherwise stated, shall be measured in accordance with the Principles of Measurement (International) for Works of Construction (June 1979) as published by the RICS.

4.1.2 All Rates shall apply equally to executing the Work in large or small quantities and difficult or easy situations and no claim shall be entertained relating to the proportions of the Work actually falling into these categories.

4.2 Analogous Rates

4.2.1 Rates shall be entered against each item listed in Schedule 'D'. Rates shall be deemed analogous to those Rates used in pricing Works and constituent parts as given in Schedule 'B' and subject to the requirements of item 1.1 herein.

4.2.2 If it can be demonstrated that any Rates in Schedule 'D' is not analogous to the Rates in Schedule 'B', then Company shall have the option to adjust the given Rates to conform to this requirement.

4.3 Day-work Rates

4.3.1 When, in the opinion of Company Work cannot be measured at Rates contained in the Schedules of Rates for additions and deletions or at rates analogous thereto, the value of such work shall be ascertained on the basis of the actual labour employed and the plant and Materials used therein. These Rates will be as stated in Schedule 'D'.

4.3.2 Labour

The rates for labour shall be comprehensive and include but not limited to:

i) Wages and all costs, payments and charges including annual and public holidays, travelling time, expenses, fares and transport, guarantee time, incentive and bonus payments, dirty money and danger money and other disbursements arising from employment of labour including redundancy payments and any requirements of the Sultanate of Oman labour Laws.

j) Charges in respect of Site and office supervision including foremen time and extra emoluments paid to foremen and leading craftsmen and gangers, small tools, HSEM requirements and personal protective requirement etc.

k) Site and head office overhead charges such as: rent, rates, insurance's, electricity, gas, fuel, water, printing, stationery, postage, telephone charges, motor car expenses etc. and repairs, renewals, maintenance and depreciation of premises, machinery plant etc.

l) Profit

4.3.3 Only where Contractor is specifically instructed, in writing, by Company to work outside normal working hours will overtime payments be certified. Overtime rates shall only apply for hours outside the normal 10-hour day, 7-day week.

4.3.4 Working supervision shall be paid for at the hourly rate for an operative of the applicable trade. Working foremen to be paid for at the Day-work Rate applicable to the trade of the foreman. Foremen shall only be paid for on Day-work where the presence of the foreman has been explicitly requested by Company.

Mechanical PlantThe Rates for mechanical plant shall be exclusive of drivers, operators and attendants, who shall be separately charged, but shall be inclusive of all fuel, lubricants and other consumables, servicing repairs, replacements and other charges relating to fully operating plant. Payment for working plant shall be for the actual hours worked only. No allowance for Stand-by Time will be paid, unless expressly instructed by Company. Stand-by Time shall mean the time when personnel or plant instructed by Company to be available for Work but are not actually working.

4.3.5 Contractor shall provide for all costs and charges associated with transportation and haulage to, from and around the Site, of Contractor Personnel and equipment engaged in the Works. In this respect the costs of transportation, haulage and travelling time shall be deemed to be included in the Rates. No separate payment shall be made by Company to Contractor for transportation costs.

4.4 Additional Services Procured At Day-work Basis

Where there are no applicable Rates in the Contract for additional services to be procured at day-work basis as a result of an Instruction, such additional services shall be evaluated and agreed at net cost basis plus a percentage adjustment on the net cost.

Net cost in respect of such services shall comprise of actual cost payable by Contractor after taking into considerations of all types of discounts, commissions, and any recoverable duties and taxes.

Any travel and accommodations required as a result of providing such additional services shall be subject to Companys prior approval.

All Contractor handling, administration, financing, overheads and profit elements and all other costs related to such additional services shall be deemed to be recovered under the percentage adjustment. (Ref: Schedule D - Alterations and Day-works under the table entitled Percentage Adjustment for Overheads for Additional Services and Material Procurement.)

The evaluation of such additional services shall be supported by copy of the priced contract or copy of the invoice from Subcontractors providing such services.

4.5 Materials Procurement

Where there are no applicable Rates in the Contract for additional Materials to be procured as a result of an Instruction, such Materials shall be evaluated at net cost basis plus a percentage adjustment on the net cost.

Net cost in respect of such Materials shall comprise of:

(a)Actual Materials cost payable by Contractor after taking into considerations of all types of discounts, commissions, and any recoverable duties and taxes; and

(b)All additional costs for delivery of Materials to the first point of direct sphere of influence of the Contractor (i.e. storage warehouse, or Site location), including freight charges, insurance, port clearance /handling charges and custom duties; and

(c)all inspection and testing required.

All Contractor handling, administration, financing, overheads and profit elements and all other costs related to the procurement of such Materials shall be deemed to be recovered under the percentage adjustment. (Ref: Schedule D - Alterations and Day-works under the table entitled Percentage Adjustment for Overheads for Additional Services and Material Procurement.)

The evaluation of such Materials shall be supported by copy of the priced purchase order or copy of the invoice from the Materials Vendors.

4.6 Authorisation & Payment

4.6.1 All Dayworks must be instructed and authorised in writing and signed and approved by Company.

4.6.2 Contractor shall prepare, on a daily basis, detailed statements of Day-works executed. These shall be submitted to Company for approval, no later than 24-hours following the completion of the days work to which it relates. Any statements received after this duration maybe subject to assessment and adjustment by Company.

5 Terms of Payment

5.1 Milestones Payments (Schedule E)

5.1.1 The Work to be performed by Contractor as detailed in C4 Scope of Work has been divided into Milestone (MS) groupings as detailed in Schedule 'E'. Only on Completion, to the satisfaction of Company, of all Work contained within these Milestone groupings will Company issue Contractor with a Certificate certifying Milestone Completion. A Milestone shall only be deemed to be complete when so certified by Company.

5.1.2 No Milestone shall be certified as complete until all outstanding related HSE and quality audit non-conformance's have been accepted as being complete by Company.

5.2 Payments

5.2.1 On receipt of a Company certified "Certificate of Milestone Completion", Contractor shall invoice Company the percentage of the Contract Price stated as being due for achievement of that Milestone in Schedule 'E'. Unless specifically stated otherwise, in the event that no milestone is certified as being complete during a particular month then no invoice shall be submitted. All applications for payment shall conform to the requirements of Section C8 Procedures for Contractors and applicable payment shall be released in accordance with Section C3 General Conditions of Contract.

5.2.2 Unless specifically stated otherwise, Contractor shall be paid for Provisional and Optional Work only upon their completion. Provisional and Optional Work may be invoiced together with the next subsequent completed Milestone.5.2.3 The invoice for payment shall detail the accumulative total percentage, applied to the Contract Price together with the total amount of instructed and completed Provisional and Optional Work less all previous payments. All invoices shall detail the amounts due under each of the headings in the Schedules of Rates and for each Variation to Contract, together with adequate supporting documentation.

5.2.4 Invoices shall only be considered for payment provided all other contractual obligations have been fulfilled.

5.3 Completion of the Work (MS 10)

5.3.1 Contractor may only apply for payment of MS 10 'Completion of the Work' once all Contractor's applications for additional moneys resulting from alterations, Field Trouble Reports, Instructions and formalised by Variations to Contract, and the consequent resultant effects have been submitted to Company for approval.

5.3.2 Contractors application for payment of Completion of the Work shall constitute notification by Contractor that this has been achieved.

5.4 Bonuses & Penalties

5.4.1 Bonuses and penalties for the Work shall only be accounted for upon completion of an applicable Milestone stage. Bonuses and penalties shall be those as detailed in Schedule 'F'.

6 Contractor's Accommodation & Facilities

6.1 Accommodation6.1.1 The Contract Price shall include for the provision and maintenance of accommodation for all Contractor Personnel. The Contract Prices shall include for all temporary facilities being constructed and operated in full compliance with Company regulations and standards for the duration of the Contract.

6.1.2 Contractor shall include for mobilisation, maintenance and demobilisation of all temporary facilities on Completion of the Work.

6.1.3 Temporary Camp

The Contractor shall provide at the allocated area, temporary camp for all their staff and Company staff for the contract duration as indicated in Section C4 General Scope of Work : 6.0 Construction, Article 6.6. The Camp shall be constructed & maintained according to Company standards & according to the requirement specified in C-6-35. Contractor shall be responsible for all site preparation, development, and reinstatement.

The Contractor shall be fully responsible in line with the Company standards for furnishing all utility services of any type within the camp plot and to support the camp within the Scope of this Contract.

Ownership of the camp facilities shall at all times remain vested in the Contractor. Any site furnished to Contractor shall be restored to original condition (cleared and cleaned), and returned to the Company in accordance with the requirements of the Contract. The Company shall have the option to require the Contractor to leave all piping, wiring, and permanent improvements as-installed at the camp site.

6.1.4 'Alternative Proposal' for Use of Contractors Existing Facilities

Should Contractor already have, or acquired, suitable and fully compliant accommodation and or industrial facilities in the location of the Work, which it is proposed to use for this Contract, then the use of these facilities shall be considered an 'Alternative Proposal'. This Alternative if required shall be instructed at time of award of the Contract.

Provision has been made to offer a saving for this 'Alternative Proposal' (Schedule B item 1 ref no. 1.11). The price for this Alternative shall be applicable to this Contract only, it shall not affect or have any bearing on any terms and conditions related to other contracts.

The use of Contractors existing facilities on this Contract is subject to the approval of Company. Such approval in no way relieves Contractor from his obligation to provide suitable fully compliant accommodation and or industrial facilities for the Work.

7 Company Provided Services

7.1 Company Provided Services

7.1.1 Unless specifically stated otherwise it is Contractors responsibility to provide all things necessary to complete the Work. However at its sole discretion Company may provide facilities and services which could comprise any or all of the following:-

Graded level area for Contractors temporary facilities with fenced perimeter boundary.

Provision of electrical power (connection point outside the fence boundary).

Piped water supply (connection point outside the fence boundary).

Access to sewage main (connection point outside the fence boundary).

Connect to Company telephone system.

Garbage collection from central location. Air transportation to and from the Interior.In the event these services are provided, and not charged for separately by Company, then Company shall have the right to deduct from amounts due under the Contract at the unit rates stated in Schedule 'B' or those stated below.

If Contractor is not required to mobilise or demobilise (Mob/Demob) for the provision of any of these facilities then the unit rates for mobilisation/demobilisation stated in Schedule 'B' shall be deducted from Contractors payments.

7.1.2 Company Telephone System

Unless stated otherwise the provision of access to Companys telephone system will be charged at the following rates:

Rental charge for each line provided for the use of the Contract - OMR 20 per month together with installation and telephone usage charges which will be levied at cost.

7.1.3 Electric power

Unless stated otherwise the provision of access to and supply of electrical power from Company grid system will be charged at 20baizas per kw/hr.7.1.4 Water Supply

Unless stated otherwise, Contractor, subject to availability, may draw water from water supply wells if available near Site or from the Company's RO contractor. Water drawn from these facilities will be subject to a charge of RO1.006 per m3, all accounts shall be settled directly with Company's operating contractor.

7.2 Logistics Service Provider (LSP) 7.2.1 The Contract Price shall include for all costs arising from the utilisation of Company LSP as detailed in C4 Scope of Work. This shall include but not be limited to; administration, procurement of the LSP service, operating restrictions, co-ordination activities notice periods etc. In the event Contractor fails to utilise the LSP without due authorisation then Company have the right, but not the obligation, to deduct the amount that would have been due to the LSP contractor in the event the transportation service had been correctly requisitioned in accordance with the Contract.

7.3 Provision of Air Passenger Services

7.3.1 When required for the performance of the Work and as required under the terms of SP2000 HSE Specification for Road Transport (Section C9 refers) Contractor Personnel may, subject to availability and Company approval, be allowed or required to use Company's air passenger service.

7.3.2 Use of Companys air passenger service shall be subject to the Companys Interior flight charges as stated below. Contractor shall include within the Rates for this requirement, including but not limited to all charges, availability restrictions, booking and other administration costs.

7.3.3 Names and details of all Contractor staff considered eligible and requiring the use of Company's air passenger service must be forwarded to Company for approval. Contractor shall notify Company of any changes to this list of eligible staff as and when they arise. In the event of disputed numbers of flights back charged in any one month, the monthly statement as issued by Companys air transport booking department shall be considered adequate substantiation for Contractor.

7.3.4 Applicable Charges

For each and every occurrence that Contractor Personnel make use of Company's air passenger service to and from the Interior or between Interior locations the sums stated below shall be due to Company. These sums will be deducted from amounts due to Contractor.

For Aircraft commuting between:-US$ / one way trip per passenger

Muscat - South Oman Interior Location243

Muscat - North Oman Interior Location121

North Oman South Oman Interior Locations237

Salalah/Marmul Nimr/Salalah81

7.3.5 Contractor may charter aircraft outside of the flight schedule (i.e. emergencies) at current applicable charges published on Companys intranet.7.3.6 Interior flight no-show shall mean a person who has reserved a seat on a flight but does not report for that flight or cancel the reserved seat in accordance with cancellation procedures. All Interior flight no-shows will be charged at the standard flight charges given above.

Section C5 Schedule of Rates, Schedule A Preambles

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