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					GEO Contract Addendum

CAGC BEST PRACTICES




             Canadian Association of Geophysical Contractors
                        1045, 1015 - 4th Street SW   Phone: 403 265 0045
                        Calgary, Alberta             Fax: 403 265 0025
                        T2R 1J4                      E-mail: info@cagc.ca
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Best Practice




GEO Contract Addendum
Table of Contents
       Open Letter ___________________________________________________ 3
       Contract Additions ______________________________________________ 4
           Terms and Conditions ________________________________________ 4
           Addendum “A” ______________________________________________ 5
       Disclaimer ____________________________________________________ 7




Revision Date: Jan 1, 2006 –GEO Contract Addendum.doc                        2
 OPEN LETTER

CAGC Members
September 30, 2005

Re: Health of the Geophysical Industry

In recent months the Geophysical Committee of the CAGC has met to tackle common issues facing
the Seismic Acquisition Contractor Group. These meetings resulted in the HR Best Practice being
developed and issued which has been met with a very favorable response from employees and clients
alike.

The fact still remains despite considerable improvement in production efficiencies and much improved
safety standards we are the only sub-industry that continues to earn a less than acceptable return even
in the face of unprecedented commodity prices and strong demand characteristics. As such it became
the goal of this committee to establish a Standard Geophysical Contract that would create financial
stability for this sector of the industry and ultimately balance the financial risk contractors are exposed
to in their day-to-day operations.

The Big Rig Drilling Industry and their CAPP clients have endorsed a similar model. As such the CAGC
submits the following Geophysical Contract Addendum as an initial step towards the goal of a Standard
Geophysical Industry Contract. This Addendum, which is supported by the majority of the Geophysical
Contractors and certainly a vast majority of the crews available in the marketplace, is the first step in
bringing some sense of stability to our marketplace.

Our industry has suffered from the “keep it cheap” mentality for a long time and the fact is that without
an economic risk adjustment we will continue to under perform financially which will ultimately result in
a sector unable to operate safely, adequately train entry level staff or develop new techniques and
technology which will be to the detriment of the geophysicists who rely on our services.

If you are reading this letter it is likely that some, or your entire livelihood, is tied into the seismic
business. I would ask you to step back and truly analyze this addendum and what it will mean to the
future of our industry sector.

Our first step must be to regain health and stability in our core business – that of the seismic contractor.

This addendum will be effective on all geophysical contracts as of September 30, 2005. It will show as
a separate document or be incorporated into company’s internal documents.

We have sought legal opinion on this document and on the approach used to ensure we are not
infringing on any legalities. We have also structured this in such a way so as not negatively impact any
other service or supply in the geophysical industry.

We welcome your comments and questions concerning this matter.

Sincerely




Mike Doyle
CAGC President


Revision Date: Jan 1, 2006 –GEO Contract Addendum.doc                                                     3
 CONTRACT ADDITIONS

       It was recommended by the representatives of the Geophysical Contractor members of the
       CAGC that the following Terms and Conditions be considered by the Contractor members for
       inclusion in each of the following agreements:

              Bids
              Proposals
              Work Orders
              Stand-Alone Agreements (Agreement)
              Supplemental Agreements
       The recommendation is to use these Terms and Conditions as an Addendum to any Master
       (or General) Service Agreement and that an Addendum to any such Master (or General)
       Agreement should also provide recommended additional wording as set forth below.

       Furthermore, any such document should also specifically detail the particulars of the Project
       and Survey and the work site to be dealt with.

Terms and Conditions

       To be included in the main body of the Bid, Proposal, Work Order, Agreement/ Supplemental
       Agreement



       Terms and Conditions – The              Bid, Proposal, Work Order, Agreement, Supplemental
       Agreement       together with attached Addendum “A” to acquire the seismic survey geophysical
       data known as Survey         Name and Location (which should specifically detail the particulars
       of the job and the work site)     shall if accepted, form the Agreement between Contractor and
       Client.




Revision Date: Jan 1, 2006 –GEO Contract Addendum.doc                                                4
Addendum “A”

       To be attached as Addendum “A” and signed by both the Contractor and the Client to the Bid,
       Proposal, Work Order, Agreement/ Supplemental Agreement

                                               Addendum “A”

                   Bid, Proposal, Work Order, Agreement/ Supplemental Agreement

       Between                                                                (the “Contractor”)

       And                                                                    (the “Client”)

       Survey Name __________________________________________

       Work site _____________________________________________

       Government Approvals and Landowner Permits – The Contractor reserves the
       discretionary right to amend any rates quoted in this Bid, Proposal, Work Order, Agreement,
       Supplemental Agreement            to reflect any unusual or special conditions or conditions
       contained in either the government approval or landowner permits adverse in nature to the
       Contractor which in the Contractor’s sole opinion would cause the Contractor to change any
       such rates if known to the Contractor beforehand.

       Statutory Holidays – In the event work is performed in terms of this Bid, Proposal, Work
       Order, Agreement, Supplemental Agreement          on a statutory holiday, the Contractor shall
       charge and the Client shall pay an additional amount equal to the additional cost of labour.

       Standby Rate – $                    per hour. The standby rate shall be in effect at any time the
       Contractor is unable to record (even though able to move certain equipment) due to forces
       beyond its control, which shall include but not be limited to: inclement weather including wind
       noise, rain, ground conditions including mud and snow, farmer activity, traffic on line, or unsafe
       working conditions, or at the Client’s request. The Standby Rate shall be charged a maximum
       of eight hours less actual hours recorded per day.

       Blowouts / Cleanup – The cost of ground repair and cleanup in terms of this Bid, Proposal,
       Work Order, Agreement, Supplemental Agreement         shall be charged to the Client at the
       Contractor’s cost.

       Sanitation – The cost of garbage bins and portable toilets including transport and disposal, in
       terms of this Bid, Proposal, Work Order, Agreement, Supplemental Agreement            shall be
       charged to the Client at the Contractor’s cost.

       Management & Administration Fee – The Client agrees to pay a Management and
       Administrative Fee calculated at ____ % on all costs of services managed by the Contractor,
                                                                                   rd
       which are specifically not included in the turnkey bid or hourly rate. All 3 party costs have
       been disclosed separately in this Bid, Proposal, Work Order, Agreement, Supplemental
       Agreement . When applicable this fee shall not be charged on costs for helicopters used in
       heli-portable operations, which are an integral component of recording. Such fee shall be in
       addition to and exclusive of the cost of a Project Manager whether hired directly by the Client
       or the Contractor.




Revision Date: Jan 1, 2006 –GEO Contract Addendum.doc                                                  5
       Settlement Terms – The Client hereby acknowledges and agrees all invoices are due and
       payable 30 days from date of receipt by the Client. Further interest will be charged at the rate
       of 1½ % per month or part thereof until such amounts are paid.

       Title – Title to the seismic data, recorded in terms of the         Bid, Proposal, Work Order,
       Agreement, Supplemental Agreement        shall be and remain with the Contractor. Title to the
       Seismic Data shall not pass to the Client until full payment by the Client and receipt by
       Contractor of all such monies due and payable under the provisions of this Bid, Proposal,
       Work Order, Agreement, Supplemental Agreement              . The Client acknowledges that the
       passage of time, for whatever reason, shall not result in the forfeiture of any Title rights of the
       Contractor to the data or of any recourse in law, including any rights contained under any
       Builders Lien Legislation.

       Damaged Equipment – The cost of repairing and or replacing equipment damaged as a
       result of circumstances outside the Contractor’s control including but not limited to fire, weather
       (including lightening) or damage caused by animals shall be reimbursed by the Client to the
       Contractor

       Additional Charges – The following additional charges, that are not specifically included in
       the hourly rate or turnkey bid, shall be charged to the Client at rates as scheduled below:

                             Item of Expenditure       Rate ($)
                     Project Manager
                     Cat Push
                     Drill Push
                     First Aid / Medic
                     Extra
                     Extra
                     Extra



       Amendment and Supercession – In the event the Contractor has an existing Master or
       General Service Agreement of a Seismic Survey or Geophysical nature this Bid, Proposal,
       Work Order, Agreement, Supplemental Agreement                   to acquire seismic survey or
       geophysical data specifically shall be in addition to and amends any such existing Master or
       General Agreement Service Agreement. If there is any conflict between the provisions of any
       such Master or General Service Agreement and the provisions of the Bid, Proposal, Work
       Order, Agreement, Supplemental Agreement              respecting ___insert Project and Survey
       job and work site this Bid, Proposal, Work Order, Agreement, Supplemental Agreement
       shall prevail over and supercede over any such provisions of such Master or General Service
       Agreement.

       No Representations or Warranties – There are no representations, warranties, terms,
       conditions, undertakings or collateral agreements, express, implied or statutory, between the
       Contractor and the Client other than as expressly set forth herein.

       Dated the ______ day of, 20___.

       CONTRACTOR                                            CLIENT

       Per: ____________________________                    Per: __________________________
                      Title                                                Title
Revision Date: Jan 1, 2006 –GEO Contract Addendum.doc                                                   6
 DISCLAIMER

       This document provides information to members of the Canadian Association of Geophysical
       Contractors wishing to establish or adopt a set of guidelines for GEO Contract Addendum.
       This document is not intended to be all – inclusive, but only a guide. The Best Practice herein
       sets out in general principal the actions necessary when conducting operations in any type of
       terrain.

       Every effort has been made to supply accurate and up to date information, however, the
       CAGC assumes no responsibility for the accuracy, adequacy, or completeness of any
       information presented within and is not responsible for any errors or omissions, or outcomes
       obtained from the use of such information. In the event of any conflict, discrepancy, error, or
       omission between the information presented in this manual and the applicable current
       provincial and/or federal contract laws, the provisions in the provincial and/or federal legislation
       will prevail.

       The members of the Best Practice Development Committee, the companies, or organizations
       they represent make no representation, warranty, or guarantee in connection with the
       publication or the contents of any recommendation, and hereby disclaim liability or
       responsibility for loss or damage resulting from the use of this document in whole or in part or
       any violation of statutory or regulatory requirements with which any recommendation may
       conflict.

       The information in this publication is intended as a guide and does not provide the only
       acceptable method of dealing with the subjects contained herein. It is not a definitive guide to
       government regulations and does not release users of this document from their responsibilities
       under applicable legislation.

       The CAGC assumes no liability in providing Best Practices. In each case, company personnel
       should conduct their own due diligence by way of seeking private legal counsel and
       familiarizing themselves with all applicable legislation.




Revision Date: Jan 1, 2006 –GEO Contract Addendum.doc                                                    7