11.2 Approval of Work Program and Budget after the Initial WP&B
(a) In respect of Work Programs and Budgets for the period following 30 June 2023, the Manager shall, for Origin B2 to submit as Operator under the JOA, prepare draft Work Programs and Budgets in accordance with: (i) the requirements of the JOA; Hamilton Locke Joint Venture and Shareholders Agreement 32 (ii) any directions of the Board; and (iii) any recommendations of the Technical Committee that have been approved by the Board, and submit the draft Work Program and Budget to the Board for approval no less than 45 days prior to the date that the Operator is required to submit a Work Program and Budget to the Operating Committee under the JOA.
(b) All draft Work Programs and Budgets must meet all minimum work and expenditure obligations under applicable laws, this Agreement and the JOA.
(c) Each Work Program and Budget shall set out all Expenditures and other costs for the applicable time period including any additional funds the Manager intends to call to maintain a cash balance in Origin B2 and a schedule of the dates and amounts of each cash call to be made during the Financial Year. Once a Work Program and Budget has been approved by the Board, the Manager shall not revise the scope, budget, or approve any variances to the Work Program and Budget without the express written approval of DWE.
(d) Within 10 days of receipt of a draft Work Program and Budget, the Board must convene a meeting and either approve or reject the draft Work Program and Budget by a Simple Majority Board Resolution.
(e) If the Board does not approve the draft Work Program and Budget at the meeting convened under clause 11.2(d): (i) then any Director that voted against the draft Work Program and Budget must, as soon as reasonably practicable following the date of such Board meeting (and in any event within 3 Business Days), notify the other Board members in writing as to the reasons it had for voting as it did and provided any requests and recommendations to amend the draft Work Program and Budget; and (ii) the Manager must amend and re-submit the draft Work Program and Budget, taking into account any reasonable feedback received from any Director who voted against the draft Work Program and Budget, for the Board’s consideration within 5 Business Days and the Board will convene a meeting and re-consider the draft Work Program and Budget as if it was submitted pursuant to clause 11.2(a).
(f) The parties acknowledge that in June 2023 they entered into a Work Program and Budget which provided for a 2 well program for the SS-1H and A3H wells (Stage 4 WP & Budget).
(g) For all Work Programs and Budgets following the Stage 4 WP & Budget, if the Board is unable to approve a draft Work Program and Budget at a meeting convened under clause 11.2(e)(ii) with the required Simple Majority Board Resolution, then the following shall apply: (i) if the Board cannot unanimously agree on well locations in the proposed Work Program and Budget, the well location in the proposed Work Program and Budget will be decided in the sole discretion of the Directors appointed by each Shareholder in an alternating order with the Directors appointed by DWE making the first well location decision and the Directors appointed by Tamboran making the second well location decision and so on (if there is an uneven number of wells in the WP&B, DWE shall have rights over one greater well than Tamboran); (ii) if it is not agreed unanimously by the Board, DWE may elect that the Directors appointed by the Shareholder that selected the well location may also select or approve the well design for the well to be drilled at that well location in their sole discretion; and Hamilton Locke Joint Venture and Shareholders Agreement 33 (iii) the Board, the Shareholders, the Company and the Manager agree that, notwithstanding the location of the wells, the order in which each well in a WP&B is drilled will be determined on a reasonable basis to maximise efficiency, provided that if there is any dispute as to the order in which each well is to be drilled or this order is not agreed unanimously, then DWE and the Directors appointed by DWE may direct the first pad in the drilling sequence and the Company and the Manager must ensure that this is given effect to (including taking all necessary steps under the JOA).
(h) If the Board does not approve a draft Work Program and Budget for the relevant period and the draft Work Program and Budget is not approved following the process set out in clause 11.2(g), the following provisions shall apply: (i) the Manager must prepare a Work Program and Budget for submission to the Operating Committee under the JOA that is limited in scope to the following: (A) is consistent with the scope of, and not in conflict with, the Minimum Work Obligations of the Permits, the commitments of the previously approved Work program and Budget, and/or the commitments of a previously approved Exploration Operation, Appraisal Plan or Development Plan; (B) is reasonably necessary to keep the Permits in full force and effect, to satisfy the Minimum Work Obligations of the Permits and to meet the commitments of a previously approved Exploration Operation, Appraisal Plan or Development Plan; and (C) meets and is consistent with the requirements of the Farm-in Agreement (if applicable) and JOA. and separate budget components on a cost pass through basis for other services which are not within the scope of clause 9.5(a), but are reasonably necessary administration and general corporate costs required for the operation of the Group in the ordinary course or the performance of the obligations of the Company, Origin B2 or the Manager under this Agreement, and the Board shall be deemed to have approved such a Work Program and Budget. (i) The Manager must provide a copy of any Work Program and Budget that is deemed approved under clause 11.2(h) to the Board as soon as reasonably practicable and, in any event, no less than 5 Business Days prior to Origin B2 submitting it to the Operating Committee.
(j) The Manager may not, under clause 11.2(h), prepare or submit a Development or Production decision and/or Development or Production Work Program and Budget (without Board approval).
(k) The Company and the Shareholders must procure that Origin B2 submits the Work Program and Budget that is approved, or deemed approved, under this clause 11 to the Operating Committee for approval under and in accordance with the JOA. (l) Once a Work Program and Budget is approved by the Operating Committee under the JOA, the Company and the Shareholders must procure that the Manager, on behalf of Origin B2, carries out the approved Work Program and Budget in accordance with the terms of the JOA.
(20min delay)