                                                                                                         ACCEPTED
                                                                                                     01-15-00867-CV
                                                                                          FIRST COURT OF APPEALS
                                                                                                  HOUSTON, TEXAS
                                                                                               11/12/2015 8:00:39 PM
                                                                                               CHRISTOPHER PRINE
                                                                                                              CLERK

                                     NO. 01-15-00867-CV

                                                                                 FILED IN
                                FIRST COURT OF APPEALS                    1st COURT OF APPEALS
                                                                              HOUSTON, TEXAS
                                      HOUSTON, TEXAS                      11/12/2015 8:00:39 PM
                                                                          CHRISTOPHER A. PRINE
                                                                                   Clerk


   PENN VIRGINIA OIL & GAS GP, L.L.C. & PENN VIRGINIA OIL AND GAS, L.P.,
                                Appellants.

                                               v.
 ALFREDO DE LA GARZA, INDIVIDUALLY AND AS NEXT FRIEND FOR XXXXXX
         XX XX XXXXX AND XXXXXXXX XX XX XXXXX, MINORS

                                                &

  JOHN PAUL ADAME, INDIVIDUALLY AND AS NEXT FRIEND OF XXXXXXXXX
  XXXXXX XXXXX, XXXX XXXX XXXXX XXX, AND XXXX XXXXXXXX XXXXX,
                             MINORS,
                             Appellees



                      On Appeal from the 215th Judicial District Court,
                                   Harris County, Texas
                                  Cause No. 2014-42519


         APPELLEES' MOTION TO DISMISS FOR LACK OF JURISDICTION


TO THE HONORABLE JUSTICES OF THE FIRST COURT OF APPEALS:

       NOW COMES Appellee Alfredo De La Garza, individually and as next friend for

XXXXXX XX XX XXXXX AND XXXXXXXX XX XX XXXXX, minors, and files this

Appellees' Motion to Dismiss Appellants, Penn Virginia Oil & Gas GP, LLC and Penn Virginia

Oil & Gas L.P. 's appeal, and in support thereof would respectfully show the Court the following:
                             Introduction & Summary of Motion

1. Appellants are Penn Virginia Oil & Gas GP, LLC and Penn Virginia Oil & Gas L.P. Appellees

   are Alfredo De La Garza, individually and as next friend for XXXXXX XX XX XXXXX AND

   XXXXXXXX XX XX XXXXX, minors.

2. Appellants filed their Motion to Compel Arbitration and to Abate on June 18, 2015. A copy of

   that motion is attached as Exhibit "A". Appellees filed their response to appellants' Motion

   to Compel Arbitration and to Abate on July 30, 2015. A copy of that response is attached as

   Exhibit "B". On August 26, 2015, appellees filed their First Amended Response to appellants'

   Motion to Compel Arbitration and to Abate. A copy of this amended response is attached as

   "Exhibit "C". On September 10, 2015, appellants filed their reply to appellees' Response to

   Motion to Compel Arbitration and to Abate. A copy of appellants' reply is attached as Exhibit

   "D". On September 11, 2015, appellees filed their first supplement to their First Amended

   Response to appellants' Motion to Compel Arbitration and to Abate.            A copy of this

   supplement is attached as Exhibit "E".       The hearing on appellants' Motion to Compel

   Arbitration and to Abate was initially set on July 31,2015, but was reset at appellees' request

   for September 11,2015 with agreement of counsel for appellants. On September 11,2015, the

   trial court heard appellants' Motion to Compel Arbitration and to Abate. Appellants' Motion

   to Compel Arbitration and to Abate was denied by order dated September 11, 2015. See

   Exhibit "F".

3. Appellants filed a Motion for Reconsideration of Order Denying Motion to Compel Arbitration

   on October 1, 2015. A copy of this motion is attached as Exhibit "G". Appellees opposed

   this motion and objected to the. affidavit of Ernest Nelson, attached to appellants' Motion for

   Reconsideration of Order Denying Motion to Compel Arbitration. A copy of appellees'
   response is attached as Exhibit "H". On October 9, 2015, appellants filed their reply to

   appellees' Response to Motion for Reconsideration of Order Denying Motion to Compel

   Arbitration. A copy of appellants' reply is attached as Exhibit "1". The Hon. Elaine Palmer,

   Judge of the 215th District Court denied appellants' Motion for Reconsideration of Order

   Denying Motion to Compel Arbitration on October 12, 2015. A copy of the order is attached

   as Exhibit "J".

4. Appellants filed their Notice of Appeal on October 13, 2015. A copy of this notice is attached

   hereto as Exhibit "K". In appellants' Notice of Appeal, they seek to appeal the court's order

   denying appellants' Motion to Compel Arbitration and to Abate signed on September 11, 2015.

   Appellants also seek to appeal the order denying defendant's motion for reconsideration of the

   order denying the motion to compel arbitration signed by Judge Palmer on October 12, 2015.

5. On October 14, 2015, appellants filed their Motion for Extension of Time to File Notice of

   Appeal.

6. The notice of appeal was untimely. The facts averred to by appellants' counsel fail to

   reasonably explain the need for an extension.

7. The order denying appellants' Motion for Reconsideration of Order Denying Motion to

   Compel Arbitration is not an appealable order.

                                  Argument and Authorities

8. This is an accelerated appeal pursuant to Tex. R. App. P. 28.1. Perfecting the appeal is

   completed by timely filing notice of appeal within 20 days pursuant to Tex. R. App. P. 28.1(b)

   and 26.1(b). Appellants' notice of appeal was filed 33 days after Judge Palmer's September

   11, 2015 order was signed and is untimely. The notice should have been filed on October 1,

   2015.
9. The facts alleged in appellants' motion and supported by appellants' affidavit attached to their

   motion for extension of time do not reasonably explain the need for extension as required by

   Tex. R. App. P. 10.5(b)(l)(C).

10. The reply filed by appellants in response to Appellees' Response to Appellants' Motion for

   Extension of Time to File Notice of Appeal fails to address Thomas J. Smith's knowledge of

   the deadline for filing the notice of appeal in an accelerated appeal. The verification of Kelly

   C. Hartmann filed by appellants was not timely filed within fifteen days as required by Tex.

   R. App. P. 26.3 and Tex. R. App. P. 10.5(b).

11. Appellants also seek to appeal the October 12, 2015 order denying appellants' motion for

   reconsideration of the trial court's order denying appellants' motion for arbitration and to

   abate. This is a non-appealable order. Tex. Civ. Prac. & Rem. Code§ 51.016. 9 U.S.C. § 16(a).

   The motion for reconsideration also did not extend the appellate timetable.               Hydro

   Management Systems, LLC v. Jalin, Ltd., No. 04-09-00813-CV, 2010 WL 1817813 (Tex.

   App.-San Antonio May 5, 2010, no pet. h.). See also Nabors Well Servs. Co. v. Aviles, No.

   06-10-00018-CV, 2010 WL 2680087, at *1-2 (Tex. App. July 7, 2010, no pet. h.).

12. Tex. Civ. Prac. & Rem. Code§ 51.016. provides that "[i]n a matter subject to the [FAA], a

   person may take an appeal or writ of error to the court of appeals from the judgment or

   interlocutory order of a district court, county court at law, or county court under the same

   circumstances that an appeal from a federal district court's order or decision would be permitted

   by 9 U.S.C. Section 16." Tex. Civ. Prac. & Rem. Code Ann.§ 51.016.
13. Section 16(a) of the FAA, titled "Appeals," provides, in relevant part, as follows:

    *2 (a) An appeal may be taken from(1)-

               (1) an order-

               (A) refusing a stay of any action under section 3 of this title,

               (B) denying a petition under section 4 of this title to order arbitration to proceed,

               (C) denying an application under section 206 of this title to compel arbitration,

               (D) confirming or denying confirmation of an award or partial award, or

               (E) modifying, correcting, or vacating an award.

   9 U.S.C. § 16(a) (2015).

14. Lucchese Boot Co. v. Licon, 388 S.W.3d 365 (Tex. App. El Paso 2012, no pet. h.) is

   distinguishable because it dealt with an amended motion to compel arbitration on an arbitration

   agreement which had not previously been offered as a basis for its original motion to compel

   arbitration. See also: Nazareth Hall Nursing Ctr. v. Castro, 374 S.W.3d 590 (Tex. App. El

   Paso 2012, no pet. h.) (following Hydro Mgmt. Sys. LLC. and distinguishing Lucchese).

                                              Prayer

       Wherefore, premises considered, appellees, Alfredo De la Garza, XXXXXX XX XX

XXXXX and XXXXXXXX XX XX XXXXX, minors, pray that this Court dismiss appellants'

appeal for want of jurisdiction pursuant to Tex. R. App. P. 42.3(a), and for such other and further

relief to which they may be entitled, whether in law or in equity.
                                            Respectfully submitted,


                                            JOHN DAVID HART
                                            State Bar No. 09147700


                                            THE LAW OFFICES OF JOHN DAVID HART
                                            Wells Fargo Tower
                                            201 Main Street, Suite 1720
                                            Fort Worth, Texas 76102
                                            (817) 870-2102 - phone
                                            (817) 332-5858 - facsimile
                                            j ohnhart@hartlaw. com

                                           ATTORNEY FOR APPELLEES, ALFREDO DE
                                           LA GARZA, INDIVIDUALLY AND AS NEXT
                                           FRIEND FOR XXXXXXX XX XX XXXXX and
                                           XXXXXXXX XX XX XXXXX, MINORS



                            CERTIFICATE OF CONFERENCE
       Pursuant to Tex. R. App. P. 10.l(a)(5), I conferred with counsel for Appellants on October
21, 2015 who have indicated that they are opposed to this Motion.
                               CERTIFICATE OF SERVICE
       The undersigned hereby certifies that a copy of the above and foregoing instrument has
been forwarded on this the 12th day of November, 2015 to the following attorneys of record
pursuant to Tex. R. App. P. 9.5:

VIA CERTIFIED MAIL & E-MAIL                       VIA CERTIFIED MAIL & E-MAIL
Mr. Thomas J. Smith                               Mr. J.J. Knauff
Mr. Kelly C. Hartmann                             The Miller Law Firm
Ms. Alexis M. Butler Hester                       Turtle Creek Centre
Galloway, Johnson, Tompkins,                      3811 Turtle Creek Blvd., Ste. 1950
Burr & Smith                                      Dallas, Texas 75219
1301 McKinney, Suite 400                          Attorney for Third Party Defendant
Houston, Texas 77010                              Penn Virginia MC Energy, LLC
Attorneys for Appellants, Penn Virginia
Oil & Gas GP, LLC and Penn Virginia               VIA CERTIFIED MAIL & E-MAIL
Oil & Gas, L.P.                                   Mr. BritT. Brown
                                                  Mr. Benjamin A. Escobar, Jr.
VIA CERTIFIED MAIL & E-MAIL                       Beirne, Maynard & Parsons, L.L.P.
Mr. J. Javier Gutierrez                           1300 Post Oak Blvd., Suite 2500
Ms. Ana Laura Gutierrez                           Houston, Texas 77056
The Gutierrez Law Firm, Inc.                     Attorney for Third Party Plaintiff
700 East Third Street                            Cudd Pressure Control, Inc.
Alice, Texas 78332
Attorneys for Appellees, John Paul Adame,
Individually and as Next Friend for
x:xxxxxxxx x:xxxx.x xxxxx, .x:xxx
.X:XXX .XXXX.X ~ and .X:XXX
.X'XXXXXX"X XXXXX, minors
    REDACTED
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               EXHIBIT "A"
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                                                                                                                7/30/2015 7:58:21 AM
                                                                                           Chris Daniel - District Clerk Harris County
                                                                                                              Envelope No. 6284037
                                                                                                          By: JEANETTA SPENCER
                                                                                                        Filed: 7/30/2015 7:58:21 AM

                                         CAUSE NO. 2014-42519

ALFREDO DE LA GARZA,                                        §        IN THE DISTRICT COURT OF
INDIVIDUALLY and AS NEXT FRIEND                             §
FOR REDACTED            and                                 §
REDACTED              , minors                              §
                                                            §
v.                                                          §        HARRIS COUNTY, TEXAS
                                                            §
PENN VIRGINIA OIL & GAS, L.P., PENN                         §
VIRGINIA OIL & GAS GP LLC,                                  §
MIKE FERGUSON, TRIFECTA OILFIELD                            §
SERVICES, LLC, CUDD PRESSURE                                §
CONTROL, INC., ROYWELL                                      §        21Sth JUDICIAL DISTRICT
SERVICES, INC., and OAKS PERSONNEL                          §
SERVICES, INC. d/b/a THE OAKS GROUP                         §


  PLAINTIFFS' RESPONSE TO DEFENDANTS, PENN VIRGINIA OIL & GAS, L.P.
AND PENN VIRGINIA OIL & GAS GP LLC'S MOTION TO COMPEL ARBITRATION
                           AND TO ABATE



TO THE HONORABLE JUDGE OF SAID COURT:


        NOW COMES Plaintiff Alfredo De La Garza, individually and as next friend for REDA
                                                                                      RED
                                                                                                           CTED
                                                                                                            ACT
REDACTED                                                                                                    ED
                                              minors, and files this Plaintiffs' Response to Defendants,

Penn Virginia Oil & Gas, L.P. and Penn Virginia Oil & Gas GP, LLC's Motion to Compel

Arbitration and to Abate, and in support thereof would respectfully show the Court the following:

                                     I. SUMMARY OF ARGUMENT

        There is no valid agreement to arbitrate between Plaintiff Alfredo De La Garza and

Defendants Penn Virginia Oil & Gas, L.P. and Penn Virginia Oil & Gas GP LLC (hereinafter

referred to collectively as the Penn Virginia defendants). The incident made the basis of this

lawsuit occurred on April 29, 2014 on the Welhausen A2H well in Lavaca County, Texas. The

work done between Nabors Completion & Production Services Co. (hereinafter referred to as


Plaintiffs' Response to Defendants, Penn Virginia Oil & Gas, L.P. and Penn Virginia Oil & Gas GP LLC's      Page 1
Motion to Compel Arbitration and to Abate

                                         EXHIBIT "B"
"NCPS"), and Penn V.irginia Oil & Gas, L.P., the operator of the well, was performed pursuant to

a Master Service Contract (hereinafter referred to as the "MSC") dated March 28, 2013. A copy

of this MSC is attached as Exhibit "A". This MSC does not reference Nabors Industries, Inc.'s

Dispute Resolution Program (hereinafter referred to as the "DRP"), and does not provide that either

Penn Virginia Oil & Gas, L.P. or Penn Virginia Oil & Gas GP LLC is an "electing entity" or would

participate in Nabors Industries,    Inc~'s   DRP. A copy of the DRP is attached as Exhibit "B". The

Penn Virginia defendants' argument that Penn Virginia Oil & Gas, L.P. and Penn Virginia Oil &

Gas GP LLC are "electing entity[ies ]"under the DRP is not a valid argument. The Penn Virginia

defendants rely on a 2008 drilling contract between Penn Virginia Oil & Gas, L.P. and Nabors

Drilling USA, LP for a well in Jefferson County, Texas, attached as Exhibit "C", and a 2010

drilling contract between Penn Virginia MC Energy, LLC and Nabors Drilling USA, LP for a well

in Oklahoma, attached as Exhibit "D", as the basis for their argument that they were an "electing

entity" under the Nabors Industries, Inc.'s DRP. Both of these contracts were only valid for the

term for completion of operations for drilling those wells. Those contracts did not control any of

the work done on the Welhausen A2H well or the relationship between NCPS and the Penn

Virginia entities for the work done on the Welhausen A2H well in April, 2014.

        The drilling contracts relied on by the Penn Virginia defendants only apply to           "pr~sent   and

former" employees and applicants ofNabors' entities at the time of the contracts. Plaintiff Alfredo

De La Garza was not a "present or former" employee of any Nabors entity as of 2008 or 201 0, as

noted in Keith Nicholson's affidavit, attached as Exhibit "E".

        Furthermore, arbitration cannot be compelled in this matter because claims asserted by

Plaintiffs Alfredo De La do not fall within the scope of the DRP and its arbitration provisions.

Additionally, Defendants have failed to establish that Plaintiffs REDACTED                                    ,



Plaintiffs' Response to Defendants, Penn Virginia Oil & Gas, L.P. and Penn Virginia Oil & Gas GP LLC's   Page 2
Motion to Compel Arbitration and to Abate
minors, are subject to any valid arbitration agreement. Plaintiffs further contend that arbitration

should not be compelled in this matter because Defendants have waived any right to compel

arbitration in this matter.

        For the foregoing reasons, Plaintiffs respectfully request that the Penn Virginia defendants'

Motion to Compel Arbitration and to Abate be denied. In the alternative, Plaintiffs request that

their continuance of Defendants' motion be granted; that they be allowed to conduct discovery as

to arbitrability; that they be allowed to participate in a full evidentiary hearing as to the Penn

Virginia defendants' Motion to Compel Arbitration and to Abate; and that upon hearing the

arguments and evidence, that Defendants' Motion to Compel Arbitration and to Abate be denied.

        Plaintiffs request that their claims against Defendant Mike Ferguson and Defendant Oaks

Personnel Services, Inc. d/b/a The Oaks Group be severed from any claims against the Penn

Virginia defendants and that these claims be tried on October 19, 2015. While Defendant Mike

Ferguson has pled for arbitration, he has not filed a motion for arbitration, a notice of arbitration,

nor has he joined in the Penn Virginia defendants' motion for arbitration. Defendant Oaks

Personnel Services, Inc. d/b/a The Oaks Group has not asserted a claim or plead that it is entitled

to arbitration in connection with Plaintiffs' claims.

                        II. INTRODUCTION & FACTUAL BACKGROUND

        On April29, 2014, Plaintiff Alfredo De La Garza was an employee ofNabors Completion

& Production Services Co. (hereinafter referred to as "NCPS"). NCPS is a subsidiary of Nabors

Industries, Inc. On this date, Plaintiff was working on Nabors Rig No. 1480, outside of Shiner,

Texas. Penn Virginia Oil & Gas, L.P. was the operator of the well and was directing workover and

completion operations on the well.




Plaintiffs' Response to Defendants, Penn Virginia Oil & Gas, L.P. and Penn Virginia Oil & Gas GP LLC's   Page 3
Motion to Compel Arbitration and to Abate
        The well service operations on the W elhausen A2H well were being conducted pursuant to

a MSC between Penn Virginia Oil & Gas, L.P. and NCPS dated March 28, 2013. The MSC is

attached to this response as Exhibit "A". By its terms, the MSC supersedes all prior agreements

between the parties. The agreement states in part that, "This Contract shall become effective the

date first hereinabove written and shall supersede all prior service contracts between the parties

hereto with respect to new work or services commenced during the term of this Contract to be

performed in connection with this Contract." Exhibit "A", page 2. There is no reference in the

MSC to Nabors Industries, Inc.'s DRP. The MSC does not contain an agreement that either of the

Penn Virginia defendants and NCPS agree that Penn Virginia Oil & Gas, L.P. or Penn Virginia

Oil & Gas GP LLC will be an "electing entity" in Nabors Industries, Inc.'s DRP.

        During the operations, there was a pressure control failure that caused senous and

permanent injuries to Plaintiff Alfredo De La Garza. As a result of the serious, permanent, and

disabling injuries to Plaintiff Alfredo De La Garza, minors Plaintiffs REDACTED

                          have suffered a loss of consortium.

        Plaintiffs filed this action against the Penn Virginia defendants on July 24. 2014. A copy

of this petition is attached as Exhibit "F". Plaintiffs' filed their First Amended Original Petition

on September 8, 2014. A copy of Plaintiffs' First Amended Original Petition is attached as Exhibit

"G". Plaintiffs filed their Second Amended Original Petition on October 1, 2014. A copy is of

this petition is attached as Exhibit "H".

        On June 18, 2015, the Penn Virginia defendants filed their Motion to Compel Arbitration

and to Abate. A copy of the Nabors Industries, Inc.'s DRP is attached as Exhibit "B". In this

motion, the Penn Virginia defendants contend that Plaintiffs' claims against Defendants fall within




Plaintiffs' Response to Defendants, Penn Virginia Oil & Gas, L.P. and Penn Virginia Oil & Gas GP LLC's   Page 4
Motion to Compel Arbitration and to Abate
the scope of a valid arbitration agreement governed by Nabors Industries, Inc.'s DRP and the

Federal Arbitration Act.

        The Nabors' DRP states that"[t]he Program is designed to provide a means for the quick,

fair, accessible, and inexpensive resolution of Disputes between the Company and the Company's

present and former Employees and Applicants for employment related to and arising out of a

current, former, or potential employment relationship with the Company." Exhibit "B" at p. 2.

Nabors' DRP further provides the following definitions:

        "'Company' means Sponsor and every direct or indirect subsidiary (whether a corporation,
        limited liability company, company partnership or other legal entity of Sponsor, any
        Electing Entity ... provided, however, that in the case of an Electing Entity, "Company"
        shall include the Electing Entity only to the extent provided in the Electing Entity's
        agreement to be bound by the Program."

        " 'Dispute' means all legal and equitable claims, demand, and controversies, of whatever
        nature or kind, whether in contract, tort, under statute or regulation, or some other law,
        between persons bound by the Program or by agreement to resolve Disputes under the
        Program, or between a person bound by the Program and a person or entity otherwise
        entitled to its benefits, including, but not limited to, any matters with respect to: ... any
        personal injury allegedly incurred in or about a Company workplace or in the course and
        scope of an Employee's employment."

        " 'Electing Entity' means any legal entity that has agreed to be bound by the Program as
        provided herein."

        "'Employee' means any person who is or has been in the employment of the Company on
        or after the effective date of this Program ... "

        "'Party' means, with respect to a particular Dispute, affected person and/or entities bound
        by this Program."

        " 'Sponsor' means Nabors Industries, Inc., a Delaware corporation."

!d. at pp. 2-4.

        As to "Electing Entities", the Nabors' DRP provides:"[ c]orporations or other.legal entities,

not otherwise Parties, may elect to be bound by this Program by written agreement with Sponsor."



Plaintiffs' Response to Defendants, Penn Virginia Oil & Gas, L.P. and Penn Virginia Oil & Gas GP LLC's   Page 5
Motion to Compel Arbitration and to Abate
I d. at p. 7. The DRP further provides that: "[ e]lection may be made only as to some types of

Disputes, or only as to some persons, in the discretion of Electing Entity." Id.

        The Penn Virginia defendants rely on the 2008 International Association of Drilling

Contractors Drilling Bid Proposal and Daywork Drilling Contract- U.S. (hereinafter referred to

as the "2008 drilling contract"), attached as Exhibit "C". NCPS was not a party to this contract.

The 2008 drilling contract between Penn Virginia Oil & Gas, L.P. and NaborsDrilling USA, LP

was only in force and effect until drilling operations were completed for the well which was being

drilled in Jefferson County, Texas in 2008. The term of that agreement is defined in Paragraph 6.1:

        "Duration of Contract: This Contract shall remain in full force and effect until drilling
        operations are con1pleted on the well or v1ells specified in Paragraph 1 above, or for a term
        of         , commencing on the date specified in Paragraph 2 above." Exhibit "C", p. 1.

        By its terms, the provisions relied on by the Penn Virginia defendants relating to Nabors

Industries, Inc.'s DRP only apply to "the present and former Employees and Applicants ofNabors"

as of the date of this drilling contract in 2008:

        "Operator, its parent, subsidiary and affiliated corporations, as well as the employees,
        officers and directors of each (collectively, "Operator") is cognizant of the Nabors Dispute
        Resolution Program and wishes to become an Electing Entity, as defined in that Program.
        Accordingly, Operator and Nabors Industries, Inc. ("Nabors") hereby agree that Operator
        is an Electing Entity as to all Disputes between Operator and the present and former
        Employees and Applicants of Nabors pursuant to the Nabors Dispute Resolution
        Program as it currently exists and as maybe amended from time to time [emphasis added].
        In the event the Program is amended, Nabors agrees to provide a copy of the amendment(s)
        to Operator. Operator may withdraw this election to participate in the Program at any time
        by giving notice of such withdrawal to Nabors, such revocation to be effective with respect
        to any claims not yet instituted as of the date of revocation. Operator understands that it is
        bound by the terms of the Program with respect to all Disputes with Nabors employees,
        regardless of whether such Dispute is initiated by the employee or by Operator. Operator
        and Nabors acknowledge that the Program does not apply to disputes between Operator
        and Nabors and that the Program does not alter the terms of any indemnification agreement
        between them." Exhibit C, page 1 of the 2008 drilling contract's Exhibit "C": Contractors
        Special Provisions.




Plaintiffs' Response to Defendants, Penn Virginia Oil & Gas, L.P. and Penn Virginia Oil & Gas GP LLC's   Page 6
Motion to Compel Arbitration and to Abate
        The Penn Virginia defendants also rely on the 2010 International Association of Drilling

Contractors Drilling Bid Proposal and Daywork Drilling Contract- U.S. (hereinafter referred to

as the "2008 drilling contract"), attached as Exhibit "D". NCPS was also not a party to this

contract. The 2010 drilling contract between Penn Virginia MC Energy, LLC and Nabors Drilling

USA, LP was only in force and effect until drilling operations were completed for the well which

was being drilled in Logan County, Oklahoma in 2010. The term of that agreement is defined in

Paragraph 6.1:

        "Duration of Contract: This Contract shall remain in full force and effect until drilling
        operations are completed on the well or 'Neils specified in Paragraph 1 above, or fur a term
        of         , commencing on the date specified in Paragraph 2 above." Exhibit D, page 1.

        By its terms, the provisions relied on by the Penn Virginia defendants relating to Nabors

Industries, Inc.'s DRP only apply to "the present and former Employees and Applicants ofNabors"

as ofthe date of this agreement in 2010:

         "Operator, its parent, subsidiary and affiliated corporations, as well as the employees,
        officers and directors of each (collectively, "Operator") is cognizant of theN abors Dispute
        Resolution Program and wishes to become an Electing Entity, as defined in that Program.
        Accordingly, Operator and Nabors Industries, Inc. ("Nabors") hereby agree that Operator
        is an Electing Entity as to all Disputes between Operator and the present and former
        Employees and Applicants of Nabors pursuant to the Nabors Dispute Resolution
        Program as it currently exists and as may be amended from time to time [emphasis added].
        In the event the Program is amended, Nabors agrees to provide a copy of the amendment(s)
        to Operator. Operator may withdraw this election to participate in the Program at any time
        by giving notice of such withdrawal to Nabors, such revocation to be effective with respect
        to any claims not yet instituted as of the date of revocation. Operator understands that it is
        bound by the terms of the Program with respect to all Disputes with Nabors employees,
        regardless of whether such Dispute is initiated by the employee or by Operator. Operator
        and Nabors acknowledge that the Program does not apply to disputes between Operator
        and Nabors and that the Program does not alter the terms of any indemnification agreement
        between them." Exhibit D, page 1 of the 2010 drilling contract's Exhibit "C": Contractors
        Special Provisions.

        Plaintiff Alfredo De La Garza was not a present or former employee ofNCPS in 2008 or

in 2010. Plaintiff Alfredo De La Garza initially applied for employment with NCPS on July 16,



Plaintiffs' Response to Defendants, Penn Virginia Oil & Gas, L.P. and Penn Virginia Oil & Gas GP LLC's   Page 7
Motion to Compel Arbitration and to Abate
2013. Mr. De La Garza's application is attached as Exhibit "1".                     Further, per Mr. Keith

Nicholson's sworn affidavit, Mr. De La Garza executed a document entitled "Application for

Hourly and Daily Employment." His affidavit is attached as Exhibit "E".

         There is no written agreement purporting to bind the minor Plaintiffs REDACTED

                               to arbitration.

        There is no written agreement purporting to bind Defendant Mike Ferguson or Defendant

Oaks Personnel Services, Inc. d/b/a The Oaks Group to arbitration.

                                III.APPLICABLE LEGAL STANDARDS

        Under the Federal Arbitration Act ("FAA"), 9 U.S.C. § 1, et seq., a party seeking to compel

arbitration must first establish the existence of an arbitration agreement subject to the FAA. In re

First Merit Bank, NA., 52 S.W.3d 749, 753 (Tex. 2001) (orig. proceeding). If one party denies

that there is a binding arbitration agreement, the trial court may summarily decide whether to

compel arbitration on the basis of uncontroverted affidavits, pleadings, discovery, and

stipulations. Jack B. Anglin Co. v. Tipps, 842 S.W.2d 266, 269 (Tex.1992) (orig. proceeding).

However, if the material facts necessary to determine the issue are controverted, by an opposing

affidavit or otherwise admissible evidence, the trial court must conduct an evidentiary hearing to

determine the disputed material facts. Id.; TEX. CIV. PRAC. & REM. CODE§ 171.021.

        When deciding whether the parties agreed to arbitrate under the FAA, court should apply

ordinary state law principles regarding the formation of contract. In reD. Wilson Canst. Co., 196

S.W.3d 774,781 (Tex. 2006); 9 U.S.C. § 1, et. seq.; TEX. CIV. PRAC. & REM. CODE§ 171.001

et seq. An arbitration agreement must meet all the requisite contract elements, and even though

there is a strong presumption favoring arbitration, the presumption only arises after the part seeking

to compel arbitration proves that a valid arbitration agreement exists. J.M Davidson, Inc. v.


Plaintiffs' Response to Defendants, Penn Virginia Oil & Gas, L.P. and Penn Virginia Oil & Gas GP LLC's   Page 8
Motion to Compel Arbitration and to Abate
Webster, 128 S.W.3d 223, 227 (Tex. 2003); In re Halliburton, 80 S.W.3d 566, 570 (Tex. 2002).

The policy in favor of arbitration agreements does not apply when a court is examining the

threshold question of whether an arbitration agreement exists. Granite Rock Co. v. Int 'l

Brotherhood ofTeamsters, 130 S. Ct. 2847 (2010); In re Morgan Stanley & Co., 293 S.W.3d 182,

183 (Tex. 2009). If the trial court finds there is a valid agreement to arbitrate, the burden shifts to

the party opposing arbitration to prove his defenses. JM Davidson, Inc., 128 S.W.3d at 227. An

agreement to arbitrate may be avoided on a ground that exists at law or in equity for the revocation

of a contract. TEX. CIV. PRAC. & REM. CODE§ 171.001; Rachal v. Reitz, 403 S.W.3d 840, 843

(Tex. 2013).

        Once a valid agreement to arbitrate has been established, the court must further determine

whether the non-movant's claims fall within the scope of the arbitration agreement. In re First

Merit Bank, NA., 52 S.W.3d at 753. Federal policy embodied in the FAA favors agreements to

arbitrate and courts must resolve any doubts about an arbitration agreement's scope in favor of

arbitration. !d. at 753. But those public policies favoring arbitration do not extend to any favorable

inclination one way or the other with regard to the questions of who is bound by the arbitration

agreement because the purpose of the FAA is to "make arbitration agreement as enforceable as

other contracts, but not more so." In re SSP Partners d/b/a Circle K and Jose Almaguer, 241

S.W.3d 162, 167-168 (Tex. App.          Corpus Christi 2007, orig. proceeding [mand. denied]).


                                   IV. ARGUMENT & AUTHORITIES

    A. Defendants have failed to prove the existence of an agreement to arbitrate between
       Plaintiff Alfredo De La Garza and the Penn Virginia defendants.




Plaintiffs' Response to Defendants, Penn Virginia Oil & Gas, L.P. and Penn Virginia Oil & Gas GP LLC's   Page 9
Motion to Compel Arbitration and to Abate
        The Court cannot properly compel arbitration of Plaintiffs claims in this matter because the

Penn Virginia defendants have failed to prove that an agreement to arbitrate exists between either

Penn Virginia entity and Plaintiffs.

        In Defendants' Motion to Compel Arbitration, there is no contention that there is any direct

arbitration agreement between Plaintiffs and the Penn Virginia defendants. Rather, the Penn

Virginia defendants rely entirely on Nabors' Dispute Resolution Program relating to Plaintiff

Alfredo De La Garza's employment with Nabors Industries, Inc.'s subsidiary, NCPS.

        The initial burden of the party seeking to compel arbitration - to establish the arbitration

agreement's existence       includes proving the entity seeking to enforce the arbitration agreement

was a party to it or had the right to enforce the agreement notwithstanding. See Pepe Int 'l Dev. Co.

v. Pub Brewing Co., 915 S.W.2d 925, 931 (Tex. App.- Houston [1st Dist.] 1996, no writ).

        The MSC specifically provides that it will govern work by and among Penn Virginia Oil

& Gas Corporation, Penn Virginia Oil & Gas, L.P., Penn Virginia MC Energy L.L.C., and Nabors

Completion & Production Services Co. The parties to that agreement did not choose to include

any reference to the Nabors Industries, Inc.'s DRP. The contract did not include any agreement

that either Penn Virginia defendant would be an "electing entity" in the Nabors Industries, Inc.'s

DRP. As a matter of law, there is no agreement to arbitrate between Plaintiffs and the Penn

Virginia defendants based on the MSC.

        Despite their contentions, the Penn Virginia defendants have not established their right to

enforce any arbitration agreement that may exist between Plaintiff Alfredo De La Garza and

NCPS. The Penn Virginia defendants cannot avail themselves of the Nabors Dispute Resolution

Program as an "Electing Entity", as any agreement entered into by Defendants to be bound by

Nabors' DRP fails by the express terms of the DRP.



Plaintiffs' Response to Defendants, Penn Virginia Oil & Gas, L.P. and Penn Virginia Oil & Gas GP LLC's Page 10
Motion to Compel Arbitration and to Abate
        As dictated by the terms of Nabors' DRP, an Electing Entity "may elect to be bound by

this Program by written agreement with Sponsor." Id. atp. 7. The Sponsor under the DRP is Nabors

Industries, Inc. Id. at p. 4. Although Defendants state that it is an "undisputed fact" that they are

Electing Entities ofN abors' DRP, no written agreement between the Penn Virginia defendants and

Nabors Industries, Inc., as a signatory, is attached to Defendants' motion establishing such status.

Instead, Defendants attached two "IADC contracts" to its motions: (1) a 2008 contract executed

by Defendant Penn Virginia Oil & Gas, LP and Nabors Drilling ysA, LP. Exhibit "C"; and, (2)

a 2010 contract executed by Penn Virginia MC Energy and Nabors Drilling USA, LP. Exhibit

"D". Neither contract establishes a written agreement with Nabors Industries, Inc., the Sponsor of

Nabors' DRP; therefore, the Penn Virginia defendants cannot take advantage of any agreement to

arbitrate that may exist between Plaintiff Alfredo De La Garza and his employer NCPS because

Defendants do not qualify as an Electing Entity under the Program. Each of these contracts would

certainly have expired by its own terms years before the incident made the basis of the suit

occurred.

        Plaintiffs should not be compelled to arbitrate their claims against the Penn Virginia

defendants in absence of an agreement to do so. Trico Marine Servs., Inc. v. Stewart & Stevenson

Technical Services, Inc., 73 S.W.3d 545, 548 {Tex. App. - Houston [1st Dist.] 2002, orig.

proceeding [mand. denied]). The burden is upon the party seeking to compel arbitration to establish

the existence of an arbitration agreement. In re Oakwood Mobile Homes, Inc., 987 S.W.2d 571,

573 (Tex. 1999). Because Defendants have failed to meet this burden, Defendant's Motion to

Compel Arbitration and to Abate should be denied as to the claims of Plaintiffs Alfredo De La

Garza and minor Plaintiffs REDACTED                                               .




Plaintiffs' Response to Defendants, Penn Virginia Oil & Gas, L.P. and Penn Virginia Oil & Gas GP LLC's Page 11
Motion to Compel Arbitration and to Abate
    B. Defendants have failed to establish that Plaintiff Alfredo De La Garza's claims are
       within the scope of any arbitration agreement.

        Defendants have failed to establish that Plaintiff Alfredo De La Garza's claims fall within

the scope of any agreement to arbitrate.

        If a valid arbitration agreement is found to exist, the Court would then need to determine

if the claims asserted by Plaintiffs fall within the scope of the arbitration agreement. Personal Sec.

& Safety Sys., Inc. v. Motorola, Inc., 297 F.3d 388, 392 (5th Cir. 2002); In re Oakwood Mobile

Homes, Inc., 987 S.W.2d at 573. Only matters subject to the covenant of arbitration should be

arbitrated. See Wee Tots Pediatrics, P.A. v. Morohunfola, 268 S.W.3d 784, 793 (Tex. App.-Fort

Worth 2008, no pet. & orig. proceeding). In determining whether a claim falls within the scope of

an arbitration agreement, looks at the facts alleged, rather than the legal causes of actions

presented, and considers whether the facts touch matters covered by the underlying arbitration

agreement. Rachal v. Reitz, 403 S.W.3d at 846. Here, Plaintiff Alfredo De La Garza's claims are·

outside the express scope of the purported arbitration agreement and elections allegedly made by

the Penn Virginia defendants in 2008 and 2010.

        In Defendants' Motion to Compel Arbitration, the Penn Virginia defendants contend that

Plaintiff Alfredo De La Garza's claims "clearly fall within the scope of the arbitration agreement"

because "the DRP clearly and unequivocally states that it applies to and binds the Company, each

Employee and Applicant." Defendants argue that Plaintiff Alfredo De La Garza was an employee

of NCPS at the time of the incident giving rise to Plaintiffs' claims and therefore is subject to

Nabors' DRP. Defendants' contentions fail to take into account the specific terms of the election

made by Defendants its written agreements to be bound by the Nabors' DRP. Specifically, in the

agreements the Penn Virginia defendants elected to be bound by Nabors' DRP as to current and

former employees of Nabors Industries, Inc.


Plaintiffs' Response to Defendants, Penn Virginia Oil & Gas, L.P. and Penn Virginia Oil & Gas GP LLC's Page 12
Motion to Compel Arbitration and to Abate
        In their motion, Defendants attached two "IADC contracts": (1) the 2008 contact executed

by Defendant Penn Virginia Oil & Gas, LP and Nabors Drilling USA, LP (Exhibit "C"); and, (2)

the 2010 contract executed by Penn Virginia MC Energy and Nabors Drilling USA, LP (Exhibit

"D").   Defendants contend that a provision in the "Contractors Special Provisions" of these

contracts constitutes Defendants' agreement to be bound to Nabors' DRP. In both contracts, the

provision states:

        "Operator, its parent, subsidiary and affiliated corporations, as well as the employees,
        officers and directors of each (collectively, "Operator") is cognizant ofthe Nabors Dispute
        Resolution Program and wishes to become an Electing Entity, as defined in that Program.
        Accordingly, Operator and Nabors Industries, Inc. ("Nabors") hereby agree that Operator
        is an Electing Entity as to all Disputes between Operator and the present and former
        Employees and Applicants ofNabors".

Exhibit "C", page 1 of the 2008 drilling contract's Exhibit "C": Contractors Special Provisions

(emphasis added); Exhibit "D", page 1 of the 2008 drilling contract's Exhibit "C": Contractors

Special Provisions (emphasis added).

        Under the express terms of the "Contractors Special Provisions" that Defendants contend

binds them to Nabors' DRP, Defendants elected to limit its participation in the DRP as to only

current and former employees of Nabors Industries, Inc. Nabors' DRP specifically provides for

such an election, stating that: "[ e]lection may be made only as to some types of Disputes, or only

as to some persons, in the discretion of Electing Entity." Exhibit "B", page 7.

        Here, it is undisputed that Plaintiff Alfredo De La Garza was hired by NCPS as a crew

worker on July 22, 2013. Exhibit "E" at 3. Further, it is undisputed that Plaintiff Alfredo De La

Garza was an employee of NCPS at the time of the incident giving rise to his claims against

Defendants. I d. at 3. As such, Plaintiff Alfredo De La Garza was not a current or former employee

of Nabors Industries, Inc. or any subsidiary during or prior to 2010. The drilling contracts were

entered into on September 23, 2008 and September 8, 2010, years before Plaintiff Alfredo De La

Plaintiffs' Response to Defendants, Penn Virginia Oil & Gas, L.P. and Penn Virginia Oil & Gas GP LLC's Page 13
Motion to Compel Arbitration and to Abate
Garza applied to or was ever employed by NCPS, a subsidiary of Nabors Industries, Inc. Plaintiff

Alfredo De La Garza's claims fall outside the scope of the arbitration agreement alleged to exist

by the Penn Virginia defendants. Defendants' Motion to Compel Arbitration and to Abate should

be denied as to the claims of Plaintiff Alfredo De La Garza or his minor children.

    C. Defendants have failed to establish that Plaintiffs REDACTED
              loss of consortium claims are subject to arbitration.

        Defendants have failed to establish a valid arbitration agreement that encompasses the loss

of consortium claims of the minor children of Plaintiff Alfredo De La Garza, REDACTED

                 A child can recover for loss of parental consortium when the parent suffered

serious, permanent, and disabling injury or death. In re SSP Partners, 241 S.W.3d at 171 (citing

Reagan v. Vaughn, 804 S.W. 2d 463, 467 (Tex. 1990)). Although a claim for loss of parental

consortium is derivative to the extent that liability for the parent's injury must be established, the

claim is separate and independent and not automatically extinguished merely because, for instance,

the injured parent settled his claim for personal injuries. I d. (citing Lehamn v. Har-Con Corp., 76

S.W.3d 555, 564 (Tex. App.-Houston [14th Dist.] 2002, no pet.)). Because Defendants have

provided no evidence of a written agreement signed by the children, an express provision of

Nabors' DRP binding the children to arbitration, or the application of direct-benefits estoppel,

Defendants have failed to demonstrate that Plaintiffs REDACTED                                    claims are

subject to arbitration.

        Arbitration is a matter of contract and should not be compelled without an agreement. Trico

Marine Servs., Inc., 73 S.W.3d at 548. As previously addressed, public policies favoring arbitration

do not extend to any favorable inclination one way or the other with regard to the questions of who

is bound by the arbitration agreement because the purpose of the FAA is to "make arbitration

agreement as enforceable as other contracts, but not more so." In re SSP Partners, 241 S.W.3d at


Plaintiffs' Response to Defendants, Penn Virginia Oil & Gas, L.P. and Penn Virginia Oil & Gas GP LLC's Page 14
Motion to Compel Arbitration and to Abate
167-168 (court refused to enforce an arbitration agreement in connection with claims for loss of

parental consortium by minor children of an etnployee who was injured on the job and who has

signed an enforceable agreement to arbitrate all disputes relating to her employment). In this case,

the Penn Virginia defendants contend that the claims of Plaintiffs REDACTED                                  ,

minors, are "subject to the arbitration agreement as they are derivative of De La Garza['s] claims."

Defendants provide no other basis or support for this contention.

        Under Nabors' DRP, a "dispute" is defined as "all legal and equitable claims, demand, and

controversies, of whatever nature or kind, whether in contract, tort, under statute or regulation, or

some other law, between persons bound by the Program or by agreement to resolve Disputes under

the Program, or between a person bound by the Program and a person or entity otherwise entitled

to its benefits, including, but not limited to, any matters with respect to: ... any personal injury

allegedly incurred in or about a Company workplace or in the course and scope of an Employee's

employment." Id. at p. 3. This provision does not expressly bind the minor children of any person

bound by the Program, unless the children are found to be "otherwise entitled to [the Program's]

benefits." Id. Here, the Penn Virginia defendants have provided no evidence that Plaintiffs REDA
                                                                                                       CTED
                                are third-party beneficiaries of the purported arbitration agreement

between their father and NCPS. In re SSP Partners, 241 3d at 170-171 (court refused to apply

direct benefits estoppel because minor children were not bringing claims that sought direct benefits

from a contract containing an arbitration clause, nor were they seeking and obtaining substantial

benefits from the contact itself outside the litigation). Moreover, Plaintiffs REDACTED

REDACT did not individually sign any written agreement that would bind them to the Nabors'
ED
DRP. "Texas law does not ordinarily bind children to the contracts their parents sign. In re SSP

Partners, 241 S.W.3d at 170 ((quoting Fleetwood Enterprises, Inc. v. Gaskmap, 280 F.3d 1069,


Plaintiffs' Response to Defendants, Penn Virginia Oil & Gas, L.P. and Penn Virginia Oil & Gas GP LLC's Page 15
Motion to Compel Arbitration and to Abate
1076 (5 1h Cir. 2002) (applying Texas law), opinion supplemented on denial ofreh'g, 303 F.3d 570

(5th Cir. 2002)( court held minor children were not bound by arbitration agreement where children

did not personally sign the arbitration agreement and there was no provision expressly stating that

parents, on behalf of their children, agreed to submit the children's claims to arbitration)). Plaintiff

Alfredo De La Garza did not sign any agreement or document acknowledging the Nabors' DRP

on behalf of his minor children or as representative of his children. Additionally, there is no

provision within any executed documents or the Nabors' DRP stating that Plaintiff Alfredo De La

Garza agreed to submit his children's claims to arbitration. Absent express agreement, Texas law

does not require that minors arbitrate "simply because they are minors and their claims are related

to that of their pa~ent." I d. at 170. Defendants have failed to establish that minor Plaintiffs REDA
                                                                                                       CTED
REDACTED                           parental consortium claims are bound by any valid arbitration

agreement. Defendants' Motion to Compel Arbitration and to Abate should be denied as to the

claims of the minor children.

    D. The Penn Virginia defendants waived their right to compel arbitration

        Even if the Penn Virginia defendants had established that a valid arbitration agreement

exists and Plaintiffs' claims fall within its scope, Defendants have substantially invoked the

judicial process and have waived their right to compel arbitration in this matter.

        A party seeking to enforce an arbitration agreement can lose their right to do so through

waiver. The right to have a dispute submitted to arbitration, like any other contractual right, may

be waived either expressly or implicitly. Perry Homes v. Cull, 258 S.W.3d 580, 593 (Tex. 2008),

cert. denied, 129 S. Ct. 952 (2009). Express waiver arises when a party affirmatively indicates that

it wishes to resolve the case in the judicial forum, rather than through arbitration. In re Citigroup




Plaintiffs' Response to Defendants, Penn Virginia Oil & Gas, L.P. and Penn Virginia Oil & Gas GP LLC's Page 16
Motion to Compel Arbitration and to Abate
Global Markets, Inc., 258 S.W.3d 623, 626 (Tex. 2008). Implied waiver arises when a party acts

inconsistently with the right to arbitrate and prejudices the opposing party. Id.

           The legal test for a waiver of arbitration requires conduct or activity inconsistent with the

right to arbitration and prejudice to the party claiming waiver. In re Bank One, NA., 216 S.W.3d

825, 826 (Tex. 2007) (orig. proceeding) (per curiam). A party waives an arbitration clause when

it substantially invokes the judicial process to the other party's detriment. Perry Homes, 258

S.W.3d at 590. To invoke the judicial process, a party must engage in some overt act in court that

evinces a desire to resolve the arbitrable dispute through litigation rather than arbitration. Pilot

Travel Centers, LLC v. McCray, 416 S.W.3d 168, 187 (Tex. App.-Dallas 2013, no pet.). As it

applies to waiver, "prejudice" relates to inherent unfairness in terms of delay, expense, or damag~

to a party's legal position that occurs when the party attempts to have it both ways by switching

between litigation and arbitration to its own advantage. Kennedy Hodges, L.L.P. v. Gobellan,             ~33


S.W.3d 542, 545 (Tex. 2014) (per curiam); Perry Homes, 258 S.W.3d at 597.

           The issue of whether there has been a waiver of arbitration rights is to be decided case by

case based on the totality of the circumstances. Gobellan, 433 S.W.3d at 545; Perry Homes, 258

S.W.3d at 591. In assessing the totality of the circumstances, the court will consider the following

factors:

    (1) whether the movant was the plaintiff, who chose to file in court, or the defendant, who
         merely responded;
    (2) how long the movant delayed before seeking arbitration;
    (3) when the movant knew of the arbitration clause;
    (4) whether the movant sought or opposed arbitration earlier in the case;
    (5) how much time and expense had been incurred in litigation;
    (6) whether activity in court would be duplicated in arbitration;
    (7) whether the movant filed affirmative claims or dispositive motions or sought judgment on
         the merits;
    (8) how much discovery had been conducted and who initiated it;
    (9) how much of the discovery would be useful in arbitration; and
    (1 0) how much pretrial activity related to the merits, rather than arbitrability or jurisdiction.

Plaintiffs' Response to Defendants, Penn Virginia Oil & Gas, L.P. and Penn Virginia Oil & Gas GP LLC's Page 17
Motion to Compel Arbitration and to Abate
Perry Homes, 258 S.W.3d at 591-592.

        Plaintiffs filed this case against the Penn Virginia defendants on July 24, 2014. Exhibit

"F". Plaintiffs' filed their First Amended Original Petition on September 8, 2014. Exhibit "G".

Plaintiffs filed their Second Amended Original Petition on October 1, 2014. Exhibit "H".

        On August 25, 2014, the Penn Virginia defendants filed their Original Answer which was

not subject to a motion to compel arbitration. Defendants filed a First Amended Answer to

Plaintiffs' Second Amended Petition on April 10, 2015. Defendants waited until the filing of this

answer to plead in the alternative that Defendants would assert the affirmative defenses of

arbitration and award. On April 20, 2015, Defendants filed their Second Amended Answer to

Plaintiffs' Second Amended Petition. It was not until this answer that Defendants specifically

plead that Plaintiffs' claims are "subject to mandatory binding arbitration and as such this suit must

be abated and/or dismissed. On this same date, Defendants sent a notice of arbitration. A copy of

this notice is attached as Exhibit "J".

        This case has been pending before this Court for over a year. Defendants waited until June

18, 2015, to file their Motion to Compel Arbitration and to Abate. In the meantime, Defendants

have propounded interrogatories on Plaintiffs; submitted requests for production and requests for

admissions; participated in numerous depositions; and, responded to Plaintiffs' written discovery.

Defendants did not raise the issue of arbitration in any motions, pleadings, or filings made before

their amended answer filed on April 10, 2015. Defendants delayed in filing a motion to compel

arbitration until approximately four months before the date scheduled for trial of October 19, 2015.

This delay wasted judicial resources and disadvantaged Plaintiffs who are preparing for an October

19, 2015 trial. Defendants have caused detriment and prejudice to Plaintiffs through their delay in

seeking arbitration to the extent that Plaintiffs' trial setting may be delayed.

Plaintiffs' Response to Defendants, Penn Virginia Oil & Gas, L.P. and Penn Virginia Oil & Gas GP LLC's Page 18
Motion to Compel Arbitration and to Abate
        While Defendant Mike Ferguson has pled for arbitration, he has not filed a motion for

arbitratio.n, a notice of arbitration, nor has he joined in the Penn Virginia defendants' motion for

arbitration. Defendant Oaks Personnel Services, Inc. d/b/a The Oaks Group has not asserted a

claim or plead that it is entitled to arbitration in connection with Plaintiffs' claims. This case

should proceed to trial against Defendant Mike Ferguson and Defendant Oaks Personnel Services,

Inc. d/b/a The Oaks Group on October 19, 2015.

                                     V. CONCLUSION & PRAYER

        WHEREFORE, PREMISES CONSIDERED, Plaintiffs respectfully request that the Penn

Virginia defendants' Motion to Compel Arbitration and to Abate be denied. In the alternative,

Plaintiffs request that their continuance of this motion be granted, that they be allowed to conduct

discovery as to arbitrability, and that they be allowed to participate in a full evidentiary hearing as

to the Penn Virginia defendants' Motion to Compel Arbitration and to Abate; and upon hearing

the arguments and evidence, that Defendants' Motion to Compel Arbitration and to Abate be

denied. Plaintiffs request that their claims against Defendant Mike Ferguson and Defendant Oaks

Personnel Services, Inc. d/b/a The Oaks Group be severed from any claims against the Penn

Virginia defendants and' that these claims be tried on October 19, 2015.




Plaintiffs' Response to Defendants, Penn Virginia Oil & Gas, L.P. and Penn Virginia Oil & Gas GP LLC's Page 19
Motion to Compel Arbitration and to Abate
                                                   Respectfully submitted,



                                                   J       DAVIDHART

                                                   State Bar No. 09147700
                                                   THE LAW OFFICES OF JOHN DAVID HART
                                                  Wells Fargo Tower
                                                  201 Main Street, Suite 1720
                                                  Fort Worth, Texas 76102
                                                  (817) 870-2102- Telephone
                                                  (817) 332-5858 -Facsimile
                                                  j ohnhart@hartlaw. com

                                                   ATTORNEY FOR PLAINTIFFS


                                      CERTIFICATE OF SERVICE

        The undersigned hereby ;zrtifies that a copy of the above and foregoing instrument has
    been forwarded on this :jO ~ay of July, 2015, to the following attorneys of record pursuant
    to the Texas Rules of Civil Procedure as indicated below:

    VIA CMRRR & FACSIMILE                                      VIA CMRRR & FACSIMILE
    Mr. Thomas J. Smith                                        Mr. J. Javier Gutierrez
    Mr. K~lly C. Hartmann                                      Ms. Ana Laura Gutierrez
    Ms. Alexis Butler Hester                                   The Gutierrez Law Firm, Inc.
    Galloway, Johnson, Tompkins,                               700 East Third Street
    Burr & Smith                                               Alice, Texas 78332
    1301 McKinney, Suite 1400
    Houston, Texas 77010                                       VIA CMRRR & FACSIMILE
                                                               Mr. Benjamin A. Escobar, Jr.
                                                               Mr. BritT. Brown
                                                               Beirne, Maynard & Parsons, L.L.P.
                                                               1300 Post Oak Blvd., Suite 2500
                                                               Houston, Texas 77056




                                                           JcfuN DAVID HART




Plaintiffs' Response to Defendants, Penn Virginia Oil & Gas, L.P. and Penn Virginia Oil & Gas GP LLC's Page 20
Motion to Compel Arbitration and to Abate
                                    CAUSE NO. 2014-42519

ALFREDO DE LA GARZA,                                  §      IN THE DISTRICT COURT OF
INDIVIDUALLY and AS NEXT FRIEND                       §
FOR REDACTED            and                           §
REDACTED              , minors                        §
                                                      §
v.                                                    §      HARRIS COUNTY, TEXAS
                                                      §
PENN VIRGINIA OIL & GAS, L.P., PENN                   §
VIRGINIA OIL & GAS GP LLC,                            §
MIKE FERGUSON, TRIFECTA OILFIELD                      §
SERVICES, LLC, CUDD PRESSURE                          §
CONTROL, INC., ROYWELL                                §      215th JUDICIAL DISTRICT
SERVICES, INC., and OAKS PERSONNEL                    §
SERVICES, INC. d/b/a THE OAKS GROUP                   §


                            AFFIDAVIT OF JOHN DAVID HART



STATE OF TEXAS                 §
COUNTY OF TARRANT §
        Before me, the undersigned notary, on this day personally appeared John David Hart, a
person whose identity is known to me. After I administered an oath to him, upon his oath he stated
the following:

      "My name is John David Hart. I am over 18 years of age, of sound mind, and capable of
making this affidavit. I am counsel for the Plaintiffs in the above styled case."

        "I certify that the Master Service Contract between Penn Virginia Oil & Gas, L.P. and
Nabors Completion & Production Services Co. referenced in the above response is a true and
correct copy of the Master Service Contract between these entities as produced by Defendants."

       "These documents were produced to Plaintiffs in response to Requests for Production that
were served on the Penn Virginia defendants."

         "I certify that the Affidavit of Keith Nicholson referenced in the above response is a true
and correct copy of the Affidavit of Keith Nicholson as produced by the Penn Virginia defendants
in their motion for arbitration."

        "I certify that the Notice of Arbitration referenced in the above response is a true and
correct copy of the Notice of Arbitration as produced by the Penn Virginia defendants on April20,
2015."



Affidavit of John David Hart                                                                 Page 1
        "Further, I certify that on January 13, 2015; pursuant to Rule 193.7 of the Texas Rules of
Civil Procedure, Defendants Penn Virginia Oil & Gas, L.P. and Penn Virginia Oil & Gas GP LLC
were advised that Plaintiffs intend to use the documents produced by these Defendants in
connection this cause of action."

       "I certify that the Nabors Dispute Resolution Program and Rules referenced in the above
response is a true and correct copy of the Nabors Dispute Resolution Program and Rules as
produced by Nabors Completion & Production Services Co. in response to a subpoena request."
        "I certify that the 2008 International Association of Drilling Contractors Drilling Bid
Proposal and Daywork Drilling Contract- U.S. referenced in the above response is a true and
correct copy of the 2008 International Association of Drilling Contractors Drilling Bid Proposal
and Daywork Drilling Contract - U.S. as produced by Nabors Completion & Production Services
Co. in response to a subpoena request."

        "I certify that the 2010 International Association of Drilling Contractors Drilling Bid
Proposal and Daywork Drilling Contract - U.S. referenced in the above response is· a true and
correct copy of the 2010 International Association of Drilling Contractors Drilling Bid Proposal
and Daywork Drilling Contract - U.S. as produced by Nabors Completion & Production Services
Co. in response to a subpoena request."
       "I certify that the Application for Hourly and Daily Employment for Alfredo De La Garza
with Nabors Completion & Production Services Co. that is referenced in the above response is a
true and correct copy of the Application for Hourly and Daily Employment for Alfredo De La
Garza with Nabors Completion & Production Services Co. as produced by Nabors Completion &
Production Services Co. in response to a subpoena request."
        "I certify that Plaintiffs' Original Petition and any amendments thereof that are referenced
in the above response are true and correct copies of all petitions filed by Plaintiffs with the Court
in this matter."




                                                      John David Hart


                                                                       jk.
       SWORN TO AND SUBSCRIBED TO before me on this ~day of July, 2015 .

            ,,uu,,,
      ~~~~~           CELINA DAVILA
        .
      ~:~ ~_.tJ MY COMMISSION EXPIRES
      "'-<~·.?;.;".~~~-: March 22, 2018


My Commission Expires:         3- U . . , 8           Notary Public, State of Texas



Affidavit of John David Hart                                                                 Page 2
                         ........   ·-·--------




                                             CONTRACT NO.GC-13-28




                                                                                     :i
         MASTER SERVICE CONTRACT                                                     [
                                                                                     ~:

          DATED AS OF MARCH 28, 2013                                                 ·.

                 BYANDAMONG

    PENN 'VIRGINIA OIL & GAS CORPORATION,

         PEI\"N VIRGINIA OIL & GAS, L.P .,

       PENN VIRGINIA MC ENERGY L.L.C.

                       AND

NABORS COl\1PLETION & PRODUCTION SERVICES CO.




                                                                        EXHIBIT

                                                              I            A
                                               Nabors MSA (PV cmts   3·28-13).d~




                                                                            PVOG 1
-------------=======-==--===~~~--·----····                                                                                     ..... .



                                                                  TABLE OF CONTENTS

                                                                                                                                                         ·     Page

        I.     WORK OR SERVICES COVERED .............................................:····...........................                                          u   ••• 1
        I~.    WARRANTIES AND OTHER MATIERS REGARDING MANNER OF
               PERFORMANCE OF WORK OR SERVICES ......................... ~ ..........................:......... .".. 2
        III.   RELATIONSHIP OF TI-IE PARTIES ................................................................................ 4
        N.     LAws Al"\lD REGULATIONS ............................................................................................ 5
        V.     IN"SU"RANCEREQUmED ................................................................................................ 6
        \TI.   rnDE1v.Il'-IIFICATION.......................................................................................................... 7
        VII. ENVIRONMENTAL MATIERS .................................................................................... 12
        VIII. FIDELITY......................................................................................................................... 14
        IX.    TERM ...............................................:.. .. ........ ..... ... ... .•. ........ .... ..•.. .. ..... .... .. ................ .. .. .. . 15
        X.     NOTICES .......................................................................................................................... 15
        XI.    ASSIGNMENT ................................................................................................................. 15
        XII. AUTJIORITY OF EXECUTING PARTIES ......................                                                n   ............................................   15
        XIII. AUDIT PROVISION ........................................................................................................ 15
        XIV. APPLICABLE LAW ........................................................................................................ 16
      . if!ol. \VAIVER OF LIEN .......................................................................................................... 16
        XVI. AFF~IA1ED COMPANIES ........................................................................................... 16
        XVII. GONFIDENTIALITY....................................................................................................... 17
        XVIII. ARBITRATION ............................................................................................................... 17
        XIX. MISCELLANEOUS ......................................................................................................... 18


        EXHIBITS
        EXHIBIT "A"                    MINIMUM INSURANCE REQtnREivffiNTS
        EXHIBIT ''Bu                   WAIVER OF LIEN AGREElvlENT
        EXHIBIT "C"                    JOINDER TO MASTER SERV1CE CONTRACT
        EXHIBIT "D"                    ADDITIONAL PROVISIONS




                                                                                                                                                                      PVOG2
                                                                                                          i!
                               MASTER SERVICE CONTRACT                                                    I

                                                                                                          !
         THIS MASTER SERVICE CONTRACT (this "Contract"), made and entered this 28TH                       l.
                                                                                                          r~
day of March, 2013, by and among (i) PENN VIRGINIA OlL & GAS CORPORATION~ a                              ·:
Virginia corporation ("PVOG Corp.',), PENN VIRGINIA OIL & GAS, L.P.:t a Texas limited                     i
partnership ("PVOG LP,~) and PENN VIRGINIA MC EN4RGY L.L.C., a Delaware limited                           ~
liability company e'PVMCE''), herein collectively referred to as "Company'', and (li) Nabors              i
Completion & Production Services Co., a Delaware corporation, herein referred to as                       i·
                                                                                                          I
"Contractor.':t

 IMPORTANT NOTICE: SECTIONS VI AND VII OF THIS CONTRACT
                                                                                                          I
                                                                                                          !.

   CONTAIN OBLIGATIONS TO INDEMNIFY AND RELEASE THE
 OTHER PARTY FOR DAMAGES CAUSED BY ITS OWN NEGLIGENCE,
         STRICT LIABILITY OR OTHER LEGAL FAULT
                                       WITNESSETH, that:

        For and in co:uSideration of the mutual covenants and agreements herein contained and of
the payments which may be made by. Company to Contractor pursuant to the provisions hereof,
the parties hereto mutually agree as follows:                 ·                                            I
                                                                                                           i
I.      WORK OR SERVICES COVERED                                                                           i  l
        A.        This Contract is for operations conducted by (i) PVOG Corp. in        Kentucky~·            i
                                                                                                              i
Mississippi, New Yor~ Pennsylvania, Virginia and/or West Virginia, (ii) PVOG LP in Louisiana                  !

and/or Texas and (iii) PVMCE in Oklahoma and/or Texas. For the purposes of this Contractt the
term "Company'~ shall refer to the applicable Company entity that requests that Contractor                !
perform work or services as set forth in Section I(B) of· this Contract. Contractor shall be in
privity of contract with respect to specific work or services only with the Company entity
requesting sucli work or services. The liability of each Company entity under this Contract shall             :.
be several, and not joint. Accordingly, the obligationS, representations, covenants and
ag1:ee1nents of each Cmnpany entity under this Cont1·act are several and relate only to the work or
services requested by such Company to be performed by Contractor under this Contract.

        B.      Company desires to establish and mait1tain an approved list of contractors and to
offer work or contracts only to those contractors who are included on such approved list. It is
contemplated that, from time to time during the term of this Contract, Company may request~
either orally or in 'Writing, that Contractor perform work or render services for the benefit or
account of Company. In the event that Contractor agrees to undertake the perfonnance of such
work or services for Company, the~ in each instance, the designation of work or services to be
performed and the consideration to be paid by Company to Contractor shall be as agreed by the
parties in writing and incorporated herein by reference; provided, however, that: (i) the
provisions of this Contract shall govern and be fully applicable to the performance of all such
work <;>r services and the relationship of the parties relating to or arising out of the performance
of such work. and services shall be controlled and regulated hereby; and (il) in the event of a
dispute or conflict between this Contract and any Wiiting (including, without limitation, any


                                                  1




                                                                                                 PVOG3
work order, work ticket, manifest or other vvriting between the parties) entered into or executed
subsequent to the date first set forth above, this Contract shall govern in all instances. In the
event that there is no written agreement on pricing between the parties, then pricing will be at the       i
rates agreed to· at the time such services are provided. However, any work or services provided            r
by Contractor to Company shall be governed by this Contract even if no such writirig is                    l
generated. This Contract shall become effective the date first hereinabove Wlitten and shall               !
supersede all prior service contracts between the parties hereto witli respect to new work· or             l
services commenced during the term of tllis Contract to be performed in cmmection with this
Contract.                                                                ·
                                                                                                           I
                                                                                                           i
        C.     The words "work" and Hservices", as used herein, contemplate any business
activity of Contractor which requires that its employees, servants, agents or representatives, or
the employees, servants, agents or representatives of its subcontractor(s), enter upon or utilize
any property or premises owned (in whole or in part), leased or operated by Company or which
requires that Contractor or its subcontractor(s) construct, install, recondition, 1naintain or repairt
for the benefit of Company, any propetty owned (in whole or in part), leased or operated by
Company. All work or services will be subject to the availability of excess personnel and
equipment at Contractor's facility in the area such services are to be provided.

      D.      Tlus Contract does not obligate Company to order or request any work or services
from Contractor, nor does it obligate Contractor to accept orders or request for work or services
                                                                                                           ,.'
from Company, but this Contract shall govern the parties' rights and obligations concerning all
work or services provided by Contractor to Company.

II.     WARRANTIES AND OTHER MATTERS REGARDING MANNER OF
        PERFORMANCE OF WORIC OR SERVICES

        Contractor warrants as follows:

       A.      Contractor will perform, and will cause its subcontractors to perfom1, all work or
services contemplated by this Contract with due diligence and in a good, workmanlike and
timely manner) all in strict conformity with the specifications of Company, generally accepted
industry pt•actices, all Laws (as defined in Section N(A)) and this Contract The term
"worlananlike manner" means services performed in a manner deemed proficient by those with
the speciallmowledge, training and experience to judge such. services.

       B.      Contractor shall furnish, at its sole expense and risk, all necessary personnel,
equipment, materials, tools, supplies, expertise and supervision reasonably necessary for the safe
performance of the work or services. Contractor !las adequate equipment in good working order
and adequate numbers of fully trained personnel capable of safely operating such equipment and              I

performing the work or services. Contractor shall test its equipment to ensure the same is in good
working order prior to delivery" to the work site and regularly conduct training and safety programs
for such personnel. Contractor shall not employ in any work for Company any employee whose                  r
employment violates any labor, employment or other applicable Laws. Contractor shall not                    r
employ in any workfor Company any employey who is a minor.




                                                   2




                                                                                                   PVOG4
        C.      All Contractor supplied products and equipment shall meet Company's
specifications with respect to the services for which such products an4 equipment are used. All
such products and equipment shall be selected and used with good oilfield practices for their
respective purposes and shall be in good working condition and free from defects in design}           .·
workmanship and nmterials and shall comply with all Laws. Any portion of the work found               i
defective or unsuitable shaH be removed, replaced or corrected by Contractor without additional
cost or risk to Company. ·contractor agrees to hispect ~ll materials arid· equipn1ent furnished by
Company directly employed in the course of operations conducted hereunder and shall notify
                                                                                                      I
                                                                                                      l


Company of any defects therein before using such materials and equipment. Should Contractor
use such materials and equipment without notifying Company of any defect, Contractor shall be         I
                                                                                                      1
deemed to have assumed all risk and liability for any mishap that may occur in the operations
conducted hereunder by reason of failure or defect in such materials and equipment. Unless
otherwise stated in writing, the risk of loss remains with Contractor until Company has care,
custody and control of such products, equipment or other goods; provided, however-; that title to
such products shall pass upon delivery of such products to Company. Contractor shall provide
Company and its other applicable subcontractors all Material Safety Data Sheets applicable to all
products, equipment and other goods delivered to Company>s work site. Contractor agrees to            •.
maintain its equipment in good opet·ating condition at all times and shall use all reasonable
means to control and prevent fires and blowouts, protect the hole and protect Con1pani•s
property, equipment and other goods. If Contractor provides rental products or equipmen~ such         r
                                                                                                      !
products or equipment shall be (and shall be kept) in good working order and conditio~ shall          !
include all appropriate safety and emissions control devices, shall include all emergency and         i
environmental placards and warnings and ·shall meet Company's specifications with respect to          I·
                                                                                                      !
the services for which such products and equipment are used. All consumable goods provided
by Contractor shall meet the specifications when delivered and for their normal shelf life. For
shelf life, Contractor warrants that the represented quality, composition and effectiveness of the
goods shall not be materially lessened during storage. Tins warranty requires that such stol'age
complies in material respects with the manufacturer's or supplier's recommended storage
conditions and storage period. The product or matel'ial must meet the specifications on the date
of use and on the last day ofi1s shelf life.

        D.     Contractor and its subcontractors and their respective employees, agents and
representatives shall be familiar with and comply with Company's "Health and Safety Policy,
(the "Manual"), a copy of which has been given to Contractor. Contractor agrees to ensure that
its employees~ subcontractors, agents and representatives performing work or services under this
Contract have been supplied wlth a copy of the Manual and shall comply with it.

       E.     Contractor shall comply with (i) Company,s requirements with respect to drug
testing programs under U.S. Department of Transportation regulations (if applicable) and
(ii) Company's -written policies~ if any, concerning a drug free workplace.
                                                                                                          !·
       F.      Contractor shall comply with the requirements of Company for maintaining and               i.
                                                                                                          !
providing daily recol'ds of work or services perf01med under this Contract.
                                                                                                          !
       G.      Contractor shall promptly cure or begin to cure~ if not curable within 5 days) all
defects described in Company's written notices within 5 days of notice from Company. If
Contractor fails to so cure such defects within a reasonable time after being notified, Company


                                                 3




                                                                                              PVOG5
                                                                                                         -·--,
                                                                                                            I~
                                                                                                            ,.
                                                                                                            i
may cure such defects dkectly or through another contractor, vendor or supplier. What is a                  i
                                                                                                            J
"reasonable time" shall depend upon the circumstances~ but in no event shall it exceed thirty (30)          !
                                                                                                            l.
                                                                                                            :•
days. Within thirty (30) days after receipt of a written invoice, Contractor shall reimburse                 l
                                                                                                             i!
Company for the reasonable cost of sttch warranty work; provided> that, the ammmt of such                    I

waiTanty work is uncontested by Contractor. Contractor shall not be required to pay such                     i
                                                                                                             Il
amount if Contractor is disputing its warranty obligation in good faith and has provided notice of           I
such dispute in writing to Company within 10 business days of Company, s written notice to a
Corporate Officer of Contractor of the defect with sufficient detail in Company's notice to
                                                                                                            I
provide Contractor the ability to understand the location of the defect, the general estimated
amount of the rein1bursement required, the location and date such defective work was performed
                                                                                                            lj·
                                                                                                             i
and that such notice references that there is a limitation of 10 business days for Contractor to             !
respond per the provisions of this Contract. The provisions of this Paragraph G shall be subject             i
                                                                                                             !~
to Article I, Paragraph C above.                                                                             =·l·
                                                                                                             i
                                                                                                             !·
       H.       In addition to Contractor's walTanties, Contractor shall obtain, to the maximum              F.
extent reasonably possible, assignable warranties from its subcontractors, vendors and suppliers             ~
that are no less f-avorable than the general product warranty and general service warranty provided
herein. Whatever warranty is obtained, however, shall be assigned to Company. If no formal
assignment is made, such warranties shall be deemed assigned when the applicable services
hereunder have been performed. If the foregoing warranty is breachec4 Contractor, if necessary to
                                                                                                            liI
                                                                                                             i
enforce the warranty, shall accept return of the goods and present the manufacturer or supplier with         I
a demand that the warranty be honored.                                                                       !

       I. EXCEPT AS IS OTHERWISE EXPRESSLY PROVIDED PURSUANT TO THE                                          !
TERMS OF THIS CONTRACT, GONTRACTOR MAKES NO WARRANTY OF ANY KIND,
EXPRESS OR IMPLIED (INCLUDING) WITHOUT LIN1ITATION, IMPLffiD
WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE),
                                                                                                             !
REGARDING THE MATERIALS SUPPLIED BY AGREEMENT OR WORK PERFORMED
BY CO:NTRACTOR.

Ill.   RELATIONSHIP OF THE PARTIES

        A.     It is expressly understood that Contractor shall perform work or services as an
independent contractor, wltl1 the authority and right to direct and control all of the details of the
work. Company shall exercise no control over Contractor's employees, servants, .agents or
representatives, nor those of its subcontractor(s), nor the methods or means employed by
Contractor in the performance of such work or services, Company being solely interested in the
attainment of tl,.e desired results. Compa11y shall only have the right of inspection and
supervision in order to secure the satisfactory completion of the work or services. Contractor is
not authorized to enter into or commit Company to any agreements or contracts, and Contractor
shall not represent itself as the agent or legal representative of Company.

       B.     In all cases where Contractor's or its subcontractors' employees (defined to
include, without limitation, direct, borrowed, special or statutory employees) are subject to the
Louisiana Worker's Compensation Act~ La. R.S. 23.:1021 et seq., the parties agree and recognize,·
and Contractor stipulates, that all work and operations pe1fonned by Contractor and its
employees pursuant to this Contract and any orders are an integral part of and are essential to the


                                                  4




                                                                                                 PVOG6
                                                                                                           i
  ability of Company to genetate Company's goods, products and services for purposes of La. R.S.           j
  23:1061 (A)(l). Furthermore, the Parties agree and recognizet and Contractor stipulates, that
  Company is the principal or statutory employer of Contractor's employees for purposes of La.
                                                                                                           L
  R.S. 23:1061 (A)(3) and Company shall be entitled to the protections that are afforded a stattttory      f
                                                                                                           !

  employer.under Louisiana law. In·espective of Company's status as the statutory employer or              i
                                                                                                           i
                                                                                                           I'
  special employer [as defined in La. R.S. 23:1031 (C)] of Contractor's employees) Contractor
  agrees to remhln solely and primarily responsible for the payment of Louisiana Worker's
  Compensation benefits to its employees and shall not be entitled to seek contribution for any
                                                                                                           i
                                                                                                           i
  such payments from Company. Contractor and/or Contractor's insurers agree that they shall
  have no right to seek, and shall not seek, any contribution or indemnity from Comp~y for any
  compensation benefits paid by Contractor and/or its insurers.
                                                                                                           !
          C.      In all cases where Contractor, s or its subcontractors 2 employees are covered by
  the Longshore and Harbor Wo1·kers' Compensation Act, the parties agree and recognize, and
  Contractor stipulates, that all work and operations perfonned by Contractor and its                      1-
                                                                                                           i
  subcontractors and its and their employees pursuant to this Contract are an integra[ part of and
                                                                                                           ~.
  are essential to the ability of Company to generate Company's goods and services at Company's            :.
  work site for the duration of the project pursuant to Company's health and safety policies, that         f.
  Company is the temporary or special employer of such employees for purposes of the Longshore
  and Harbor \Vorkers, Compensation Act, that Company may direct such employees beyond
  necessary cooperation but not to the extent of control required by the doctrine of respondeat
  superior, that remuneration received by Contractor from Company for services rendered will be
  used directly or indirectly to pay such employees and that Contractor will remove any of such
  employees from the project and replace· the same when required by Company. Claims made
  against Company by such employees of Contractor or its subcontractors based upon the doctrine
  of"borrowed. servant" shall, for the purposes of Longshore and Harbor Workers' Compensation
  Act insurance of Contractor, be treated ao;; a claim arising under said insurance against Contractor
  or its subcontractor as the case may be, and Company shall have benefit of said insurance to that
  extent. Irrespective of Company's status as the tempoiary or special employer of Contractor's or
  its subcontractors' employees) between Contractor and Company, Contractor agrees to remain
~ primarily responsible through its or its subcontractors' insurance for the payment of benefits
  under the Longshore and Harbor .workers' Compensation Act to its employees and its
  subcontractors" employees and Contractor and its subcontractors and its and their insurance
  carriers shall not be entitled to seek contribution for any such payments from Company.

  IV.     LAWSANDREGULATIONS

          A.     In oonnection with the performance of work and services contemplated by tills
  Contract, Contractor agrees to comply with all laws, statutes, rules and regulation.S, Federal,
  State, County/Parish and Municipal, which are now, or during the term of this Contract may be,
  applicable to its business, equipment and employees engaged in, or in any manner connected
  with, Contractor's performance of work or services for Company (collectively; "Laws,),
  including, but not limited to, Laws pertaining to protection or conservation of the air~ land, water,
  human health, industrial hygiene or other aspects of the environment, including, without
  limitatio~ the following statutes, as supplemented       and  amended: the Clean Air Act, the
  Comprehensive Environmental Response, Compensation and Liability Act, the Federal Water
  Pollution Control Act, the Solid Waste Disposal Act, the Resource Conservation and Recovery


                                                    5




                                                                                                   PVOG7
.........----·-·-·---:-----------·-··




          Act, the Safe Drinking Water Act, the Toxic Substances Control Act~ the Hazardous Materials
          Transportation Act, the Federal Oil Pollution Act of 1990) Articles 15, 17, 27 and 40 of the New
          York State Envirorunental Conservation Law; Article 12 ofthe New Yol'k State Navigation Law,
          the Pennsylvania Solid Waste Management Act, 35 P.S. § 6018.103) and any other comparable
          federal~ state or local laws, statutes; ordinances and codes and the rules, regulations; policies,
          guidelines, interpretations, decisions~ orders and directives of federal, state and/or local
          governmental ·agencies 'and authorities with ·respect thereto (collectively, "Environmental
          Laws,').

                  B.      In particular, Contractor shall fully comply with the following statutes and
          executive orders as well as the regulations, orders and rules promulgated under suclJ. statutes and
          executive orders, where required by applicable Laws, and such statutes and executive orders, as
          they may be hereafter amended, are hereby inco:rporated in this Contract by reference as if fully set
          out: (1) Equal Opportunity Clause (Applicable to aU work or purchase orders in excess of $10,000,
          41 CFR 60-1.4); (2) Affrrmative Action Compliance Programs (Applicable to work or purchase
          orders of $.50,000 or more and if Contractor has 50 or more employees, 4 I CFR 60" 1.40);
          (3) Equal Employment Oppottunity Reporting Requirements (Applicable to work or purchase
          orders of $50.,000 or more and if Contractor has 50 or more· employees, 41 CFR 60-1.7);
          (4) Affirmative Action Regarding Individuals with Disabilities (Applicable to work or purchase
          orders of$2,500 or more, 41 CFR 60~741); (5) Employment of Disabled Veterans and Veterans of
          the Vietnam Era (Applicable to work or purchase orders of $10,000 or more, 41 CFR 60-250);
          (6) Utilization of Minority Business Enterprises (Applicable to work or purchase orders of $10,000
          or more~ 41 CFR 1-1.13); (7) Utilization of Small Business Concerns (Applicable to work or
          purchase orders of $10,000 or more, 41 CFR 1-1.710-3); (8) Utilization of Labor Surplus Area
          Concerns (Applicable to work or purchase orders of $10,000 or more, 41 CPR l~I.805-3(a));
          (9) ~mority Business Enterplise Subcontracting, Small Business Subcontracting and Labor
          Surplus Area Subcontracting Programs (Applicable to work or purchase orders of $500,000 or
          more, 41 CFR 1-1.1310-2(b), 1-1710-3(b), 1-1.805.3); and (10) Clean Air and Water (Applicable
          to work or purchase orders of $100,000 or more, 40 CFR 15.4 and 15.5, 41 CFR 1-1.2303). If
          Company is required to pay any fine or penalty resulting from Contractor,s failure to comply with
          applicable Laws and/or Environmental Laws, then Contractor shall :immediately reimburse
          Company for such payment.

                 C.      Contractor certifies that it does not and will not (i) maintain or provide for its
          employees any segregated facilities at any of its establishments and (ii) permit its employees to
          perform their services at any locati.on, under its control, where segregated facilities are
          maintained. Contractor agrees that it will obtain identical certifications from proposed
          subcontractors.

          V.      INSURANCE REQUIRED

                 A.     Contractor and Company each agrees to procure and maintain at its sole ex.pense
          during the entire term of this Contract the policies of insurance in the specified minimum
          amounts set forth in Exhibit "A" attached hereto and made a prot hereof. Such insurance shall
          support each party's ·indemnity obligations to the other and other potential liabilities hereunder.




                                                            6




                                                                                                           PVOG8
             ··-- ··;·-· ...-----....   ·---~·-··-------   ...                                 ·---········--··-~-,


                                                                                                                 f
                                                                                                                 i




        B.       Prior to the commencement of any work or· senrices contemplated by this
 Contract, Contractor shall furnish to Company certificates, in duplicate~ on a fmm acceptable to
 Company, signed by an authorized representative of the insurance companies providing the
.coverage, evidencing ~ coverages, extensions and limits requh·ed to be carried by Contractor
 under the provisions of this Contract. Upon request, Company sball.have the right to examine or
 inspect the originals or certified copies of such insurance policies in the offices of Contractor
 during its rionnal business hours. ·                     ·                       ·

        C.     Failure to secure the insurance coverages, or the failure to comply fully with any
of the insurance provisions of this Contract, shall in no way act to relieve any party from the
obligations of this Contract, any provisions hereof to the contrary notwithstanding. Jf a party
fails to maintain any of the insurance herein required, such party shall release~ protect, defend,
indemnifY and hold harmless the other party's Group~ including their insurers, from and against
any and all Claims (as defmed in Section VI(A))7 which would otherwise be covered by such
insurance. Unless expressly stipulated to the contrary herein, a party's indemnification
obligations under this Contract (express or implied) shall not be limited to the amount or scope
of coverage provided by the insurance which is required to be maintained by such party under
the terms hereof. "Group" means Company Group or Contractor Group, as applicable (each as
defined in Section VI(A)).

       D.      Contractor shall require all of its subcontractors to secure and maintain the
insurance described in Exhibit "A".

VI.     INDEMNIFICATION

        The parties recogniZe that in connection with th~ petformance of the work or services
and/or the provision of goods) equipment and facilities contemplated. by this Contract, there is
some risk that accidents and events may occur in which property is lost, damaged or destroyed
and/or in which persons may be ldlled or injured. Th.e parties desire to allocate these risks
between them and to require that these risks be adequately insured so as to minimize the
possibility of disputes and to engage in effective risk management For these reasons, the parties
agree to the indemnities and defense obligations set furth below.

        A.      Mutual Release, Defense and Indemnity.

               1.       Cmnpany Group shall not be liable for and Contractor agrees to release,
protect, defend) indemnify and ~old harmless Company Group from and against any and all
claims, damages, liabilities, losses, demands, liens, encumbrances, causes of action of any kind
(including, without limitation, actions in rem or in. personam (civil or criminal) and those
concerning personal injury, death or property loss or damage), obligations) costs (including,
without limitation, l'easonable attorney 7 s fees), judgments, interest and awards, whether created
by law, contract, tort, or otherwise (collectively, '~Claims'') for personal injury, illness> death,
property (whether real or personal) owned or leased) damage and loss arising out of or resulting
from the performance of this Contract or any breach hereof by any member(s) of Contractor
Group suffered by any member(s) of Contractor Group (including Claims of spouses, heirs,
survivors or legal representatives, successors and assigns of any member(s) of Contractor
Group)t even if such are contributed to or caused by the sole, joint, comparative,


                                                                 7




                                                                                                PVOG9
                                                                                   -~-..-r- ....· - - - - · -.. ·-·~·· -~··.,........._-·~



                                                                                                                                       t




concurrent, active or passive negligence or g-ross negligence of any mcmber(s) of Company
Group. The release, protection, defense~ indemnity and hold harmless obligations assumed by
Contractor, ~nd the limitatiol].s afforded Company Group, in this Section VI(A)(l) include any
liab~lity for employment .discl'imination, medical, compensation or other benefits owed to
employees of Contractor Group as a result of the direct employ1nent relationship of such
individuals with a member of Conil:actor Group even if such individuals are determined to be the
bon:owed or statutory employee of any inember(s) of Company Group. "Company· GrouJl"
                                                                                                                                       li.
means Company, its contractors (other than Contractor and its subcontractors of any tier),.
subcontractors) co..interest owners, joint venturers, co~lessees and invitees~ and its/their affiliates,
                                                                                                                                       r:
                                                                                                                                        1
                                                                                                                                        t
shareholders, partners, members, officers, directors, employees (including the Company                                                  I

representative at the work site whether a consultant or not), agents, consultants, servants and                                        l
insurers.                                                                                                                               !:
                                                                                                                                        ~=
                                                                                                                                        ;
               2.     Contractor Group shall not be liable for and Company agrees to release,
protect) defend1 indemnify and hold harmless Contractor Group from and against any and all                                              rr
Claims for personal injury, illness, death, property (whether real or personal, owned or leased)                                        ::.
                               of
damage and loss adsing out or resulting from the performance of this Contract or any breach
                                                                                                                                        ..~
hereof by any member(s) of Company Grortp suffered by any member(s) of Company Group
(including Claims of spouses, heirs, survivors or legal representatives, successors and assigns of
any n-~ember(s) of Company Group)) even if sueh are contributed to or caused by the sole,
joint, comparative, concurrent, active or passive negligence or gross negligence of any                                                 II
member{s) of Contractor Group. The release, protectio~ defense, indemnity and hold                                                      !
harmless obligations assumed by Company, and the limitations afforded Contractor Group~ in                                              I
                                                                                                                                        !


this Section VI(A)(2) include any liability for employment discrimination, medical,                                                     r
compensation or other benefits owed to employees of Company Group as a result of the direct
employment relationship of such individuals with a member of Company Group even if such
individuals are determined to be the borrowed or statutory employee of any member(s) of
                                                                                                                                        I.
Contractor Group. ('Contractor Group'' means Contractor, its contractors and subcontractors, co-
interest owners, joint venturers, co-lessees and invitees, and its/their affiliates:. shareholderst
partners, members, officers, directors, employees, agents, consultants, servants and insurers.                                          :·


        B.      Indemnification: Savings Clauses

                1.    The indemnities in this Contract shall only be effective to the maximum
extent pennitted by applicable 'Laws. If any Law is enacted in any state that limits in any way
the extent of which indemnification may be provided to an indemnitee and such Law is
applicable to this Contrac4 then this Contract shall automatically be amended to provide that the
indemnification provided hereunder shall extend only to the maximum extent permitted by the
applicable Laws, but shall extend to such maximum extent.

               2.      In the event that this Contract is interpreted under the Laws of the State of
Texas for a particular occtmence, then Sections VI(A)(l) and VI(A)(2) shall apply, but for the
purposes of Title 6, Chapter 127 of the Texas Civil Practice and Remedies Code, commonly
known as the Texas Oilfield Anti ..Inderonity Act, the indemnity and insurance provisions of this
Contract applicable to properly damage and the indemnity m1d insurance provisions· applicable to
personal injury, bodily injury and death shall be deemed separate for interpretation,·enforcement
and other purposes. All indemnities in this Contract shall only be effective to .the maximum


                                                    8




                                                                                                           PVOG 10
                                                                                                           i


extent permitted by applicable Laws. If the Laws of the State of Texas gove1n this Contract,               [.
then Contractor and Company incorporate Title 6) Chapter 127 of the Texas Civil Practice ru).d            ·'t
Remedies Code (Texas Oilfield Anti-Indemnity Act) and agree to the limits of that statute.                 r~
                                                                                                           ::.
         The parties will each support their respective mutual indemnity obligations by furnishing         iI
liability insurance coverage (or qualified selfwinsurance) of the types set furth above obtained by
each of the parties for the benefit of the other party and its respective Group as indemnitee(s).          I·

        The parties will each support their respective ·unilateral indemnity obligation by
                                                                                                           I·
                                                                                                           \:\
furnishing liability insurance coverage (or qualified self-insurance) of the types set forth above in
                                                                                                           '
the applicable statutory amounts.                                                                          '

        If the foregoing provisions do not meet the criteria for either a mutual or unilateral             '•

indemnity obligation under such statutory provision) then the same shall be modified by the court
to the extent necessary to so comply.

              3.      In the event that this Contract is interpreted under the Laws of the State of
Louisiana for a particular occut1·ence, then Sections VI(A)(l) and VI(A)(2) shall apply, but for
the purposes of La. R.S. 9:2780, commonly known as the Louisiana Oilfield Anti-Indemnity Act,
the indemnity and insurance provisions of this Contract applicable to pr-operty damage and the
indemnity and insm·ance provisions applicable to personal injury, bodily injury and death shall
be deemed separate for interpretation, enforcement and other purposes. All indemnities in tlrls
Contract shall only be effective to the maximum extent pennitted by applicable Laws. If the
Laws of the State of Louisiana govern. tlrls Contract~ then Contractor and Company incorporate
La. R.S. 9:2780 (Louisiana Oilfield Anti-Indemnity Act) and agree to the limits of that statute.               ::

For any services for wl1ich such statute would apply, Company agrees that it will, on behalf of
Company Group, pay the premium for the extension of Contractor's insurance to cover Company
Group as an additional insured to the extent of the liabilities assumed by Conh·actor herein, and
Contractor agrees that its insurers will ilwoice Company the premium for such extension of
coverage in favor of Company Group. Contractor warrants that such premium shall constitute all
material costs for such extension of coverage. At each subsequent renewal, Contractor shall
advise Company as respects the amount for the premium required fur such extension of coverage
and shall acrange to have Company billed for the material costs of the premium for such
extension of coverage to Company Group. For any services for which such statute would apply,
Contractor agrees that it will, on behalf of Contractor Group, pay the premium for the extension
of Company,s insurance to cover Contractor Group as an additional insured to the extent of the
liabilities assumed by Company herein, and Company agrees that· its insurers will invoice
Contractor the premium for such extension of coverage in favor of Contractor Group. Company
warrants that such premimn shall constitute all material costs for such extension of coverage. At
each subsequent renewal, Company shall advise Contractor as respects the amount for the
premium required for such extension of coverage and shall arrange to have Contractor billed for
the matetial costs of the premium for such extension of coverage to Contractor Group.

               4.     In the event that New York General Obligations Law§ 5-322.1, W.Va.
Code § 55-8-14 or any other or similar Law purporting ·to limit indemnity obligations in
construction or similar contracts, is found to be appl!cable with respect to this Contract or any
services provided hereunder, then this Section VI is hereby modified to the extent necessary for


                                                  9




                                                                                                PVOG 11
                                                                         ~~--      .......,...._ _ _ _ _ _...;.--*'-"":"'---:."'--:""·----~




                                                                                                                                        !
                                                                                                                                        f.·




                                                                                                                                        .·..
compliance with and enforceability under such Law or Laws. Notwithstanding the foregoing,
however, no modification of this Section VI pursuant hereto shall cause any change to or
modification of the liability insurance coverage required by Section V or Exhibit A hereto, which
cove.rage Contractor confinns and agrees to ensu~e shall continue to fully support Contractor's
indemnity obligations above as and to the full extent set forth in this Contract.                                                        '
                                                                                                                                         i

       c; · Indemnity Not Altered by Third Party Obligations
                                                                                                                                        I
                                                                                                                                        !
        All indemnities in this Contract shall apply even though an insurer or other person or                                          !
                                                                                                                                        !•
entity is required to pay for any Claim or to make a contribution to such Claim. Even though
insurance may be arranged or other persons or entities may have certain liabilities or obligations,                                      !
each party hereto remains responsible for its indemnity and other obligations under this Contract,
even if such insurer or such other person or entity, for any reason, does not pay.

       D.      Third Party Liability

                1.      Except as provided in this Contract to the contrary, Contractor shall
release) protect, defend, indemnify and hold harmless COJ.l!.pany Gl.'oup for personal injury,
illness, death, property (whether real or personal or owned or leased) damage and other loss to
the extent that third party claims arising out of or resulting from the performance of this Contract
are contributed to or caused by the negligence, gross negligence or willful or wanton misconduct
of any member(s) of Contractor Group.                                    ·

               2.     Except as provided in this Contract to the contrary, Company shall release,
protect, defend, indemnify and hold harmless Contractor Gl·oup for personal injury, illness,
death, property (whether reaL or personal or owned or leased) damage and other loss to the extent
that third party claims arising out of or resulting from the performance of this Contract are
contributed to or caused by the negligence, gross negligence or willful or wanton misconduct of
anymember{s) ofCompany Group.

                3.      For the ptuJ1oses of this Section VI, the plu:ase "arising out of or resulting
from the p~rformance of tlrls Contract" shall be broadly construed to include, but not be limited
to, not only formal work) but also any occurrences at the work site, including transportation to
and from the work (other than personal or public transportation to· the work site), breaks,                                                  ;·.

recreation, rest periods and any other presence at the wor~ site.

       E.       Consequential Damages                                                                                                        f:
        Notwithstanding anything to the contrru·y in this Contract, neither party shall be liable to
the other for special, indirect or consequential damages, including, without limitation, loss of
use, loss of data, loss of assets, loss of business, loss of profit or business interruptions, resulting
from or arising out of this Contract, however same may be caused and regardless of the sole,
joint, comparative, concurrent, active or pa8sive negligence or gross negligence of the other
party. In no event, however, shall the provisions of this Section VI(E) limit the indemnities
given in. this Contract with respect to actions bl'ought by third parties.

        F.      h1tellectual Property


                                                   10




                                                                                                            PVOG 12
=..,._......,...__ _ _ _ _ _ _..........,._ _ _ _ _ _"""':.~..:-:". ..._,.....:-'.""l.'=""=......,..-·   ---~~-~~--------·--·-··   ...
                                                                                                                                                   "··-·----.-~


                                                                                                                                                             l


                                                                                                                                                             !·


                           Contractor shall indemnify, defend and hold harmless Company from and against any
                   and all Claims arising from or by reason of any infringement or alleged infringement of any
                   patent, trademark, copyright or other like right protected by law in respect of any property~
                   equipmell,t, services, work) methods ot process furnished or used by Contractor in connection
                   with this Contract.                                                        .

                             G.        Radioactivity, Wild Well, ReserVoir Damage, and Subsurface Trespass

                          Contractor Group shall not be liable for and Company agrees to protect, defend,
                   indemnifY, and hold harmless Contractor and its subcontractors from and against any' and                              all
                   claims for personal injury, illness, death~ property (whether real or personal,. owned or leased)
                   loss and damage, excluding that suffered by any employee of Contractor or its subcontractors,
                   incidental to or resulting :from (a) radioactivity where the release is caused, in whole or in part,
                   by conditions or events below the rotary table~ (b) loss of well control ("a wild well"), including
                   (without limitation) the costs of controlling a .wild well) (c) reservoir or underground damage,
                   including (without limitation) the costs of oil, gas, other mineral substances, water, and the well
                   bore, and (d) subsurface trespass or any action in the nature thereof, even if the Claims are
                   contributed to or caused by the sole, joint, comparative, enncurrent, active or passive
                   negligence of any n1ember(s) of Contractnr Group.

                             H.        General

                          'VITHOUT LIMITING TI~ GENERALITY OF THE FOREGOING, THE
                   PARTIES EXPRESSLY·ACI<NOWLEDGE AND AGREE, AND HEREBY INTEND TO
                   CLEARLY AND UNEQUIVOCALLY AFFIRM, THAT THE APPLICATION OF THE
                   PROVISIONS OF THIS SECTION VI MAY INVOLVE (I)INDEMNIFICATION FOR
                   CLAIMS/LOSSES DUE TO THE INDEMNITEE'S OVVN NEGLIGENCE, GROSS
                   NEGLIGENCE, STRICT LIABILITY OR OTHER FAULT, AS " 7ELL AS
                   (II) INDEMNIFICATION FOR CLA~MS!LOSSES DUE TO THE NEGLIGENCE OF
                   OTHERS (i.e., THIRD PARTIES). BOTH PARTIES AGREE THAT TmS STATEMENT
                   CO:MPLIES WITH THE REQUIREMENTt KNOWN AS THE <'EXPRESS
                   NEGLIGENCE RULE," TO EXPRESSLY STATE IN A CONSPICUOUS MANNER
                   THAT ONE PARTY (THE INDEMNITOR) HAS RESPONSIDILITY FOR THE
                   NEGLIGENCE, GROSS NEGLIGENCE, STRICT LIABILITY OR OTHER FAULT OF
                   ANOTHER PARTY (THE INDEMNITOR).              .

                           Notwithstanding any other provision of this Contract to the contrary,. Company agrees to
                   repair or replace any equipment which is (a) lost or damaged (other than ordinary wear and tear)
                   while being used in the well below the rotary table level, (b) damaged due to abnormal abrasion or
                   corrosion due to exposure to well effluents~ or (c) lost or damaged during marine transportation at
                   any time after delivery to Company or Company's other contractors at the landing, until returned to
                   the landing (d) lost or damaged for whatever reason when such equipment is provided on a rental
                   basis without a crew. Company's responsibility for such loss of or damage to any down hole,
                   marine transported, or rental equipment shall apply even if the loss or damage is due to the joint)
                   comparative, or concurrent negligence of Contractor. If the do'\'\'Il hole or rental equipment cannot
                   be repaired or the costs of 1·epair exceed the replacement ·value of the damaged .equipment,



                                                                                   11




                                                                                                                                         PVOG 13
Company agrees to pay Contractor the full replacement cost of such equipment. Company has the            I
option to replace the equipment in kind if Contractor approves the offe~ed replacement.                  Il·.
                                                                                                         :·•
VII.   ENVIRONMENTAL MATTERS
                                                                                                         I



       A.      Mutual Release, Defense and Indemnity for Pollution                                       !
               1.      Subject to Sections VI(A)(l) and VI(A)(2)~ but notwithstanding any other
                                                                                                         l
                                                                                                         i

provision of this Contract to the contrary, Company Group shall not be liable for and Contractor
agrees to release, protect, defend, indemnify and hold harmless Company Group from and
                                                                                                         l}
against any and all Claims (including~ without limitation, the cost of control and cleanup) arising
out of pollution or contamination, including, but not limited to) .fuels, lubricants, motor oils,
paints, solvents, garbage, chemicals and other pollutants (produced fluids, solids and gases,
drilling/completion fluids and cuttings are specifically excluded), originating from Contractor
Group's property which is (1) used in the performance of this Contract or any order, and (2) in
its care, custody and control~ even if such is contributed to or caused by tbe sole, joint,
comparative, concurrent, active or passive negligence or gross negligence of any member(s)
of Companv Group.

               2.     Subject to Sections VI(A)(l) and VI(A)(2), but notwithstanding any other
provision of this Contract to the contrary, Contractor Group shall not be liable for and Company
agrees to relea~e, protect, defend~ indemnify and hold hru.mless Contractor Group from and
against any and all Claims (including, without limitation, the cost of control and cleanup) for all
other pollution or contamination such as that originating from a pipeline (other than due to
Contractor Group's anchor) or storage facility or from produced fluids, solids or gases,
drilling/con1pletion fluids or cuttings or from a blowout or loss of well control, even if such is
contributed to or caused by the sole, joint, comparative, concurrent, active or passi'Ve
negligence of any mmnber(s) of Contractor Group, but NOT when caused bv the gross
negligence or willful miseonduct of a member of Contractor Group.

       B.      Hazardous Material and Waste Disposal and Clean Up

                1.     Contractor shall, at its sole expense and risk, transport and dispose of
(except as otherwise mutually agreed) any spent or used chemicals or other hazardous waste or
materials supplied by any member(s) of Contractor Gmup and used by any member(s) of
Contractor Group in the performance of this Contract or any order. Contractor is not responsible
for any materials on the location or at the work site where title has been transferred to any
member(s) of Company Group or which has passed through the well b.ead or below the level of
the rotary table, whichever is applicable, including, without limitation, matedal returns from the
well.

               2.      With respect to the materials Contractor is not responsible for under
Section VII(B)(l), Company   shall~ at its sole expense and risk, transport and dispose of (except
as otherwise mutually agreed) any spent or used chemicals or their empty packages, drums or
containers ·or other hazardous waste or materials even if such materials have ·resulted from or
were incident to the performance by any member(s) of Contractor Group of this Contract;
provided, however, that no provisions of this Contract shall relieve a transporter of hazardous


                                                 12




                                                                                               PVOG 14
 waste of its obligation to safely transport the hazardous waste to its agreed upon destination.
·Contractor Group shall not be liable for and Company agrees to· release, protect, defend,
 indemnify and hold harmless ContJ.•actol' Group from and against any and all Claims (including,
 without limitation, cost of control and cleanup) incurred by any member(s) of Contractor Group
 under any statute, regulation or otherwise arising from Company's failure to properly transport
 and/or dispose of such hazardous waste or materials) even if such is contributed to or caused
 by the sole, joint, comparative, concurrent, active      or
                                                          passive negligence oi· gross negligence
 of any member(s) of Contractor Group.

                3.     As used in Sections VII(B)(l) and VII(B)(2}, the reference to hazardous
roatetials and/or hazardous waste, whether in upper or lower case, refers to the following:

                        (i)    any chemical, material or substance at any time defined as or
included in the definition of<'hazardous substances", w&azarduus wastes", "hazardous materials,,,
'~extretnely hazal'dous waste", "acutely hazardous waste", ''radioactive waste", '~biohazardous
waste", ~~pollutant", "toxic pollutant") "contanrinanf>, "restricted hazardous waste'\ "infectious
waste", "toxic substances") or any other tenn or expression intended to defme, list or ·classify
~ubstances by reason of properties harmful to health, safety or the indoor or outdoor env1ronment
(including hannful properties such as ignitabillty, corrosivity, reactivity, carcinogeni~ity,
toxicity, reproductive toxicity, "TCLP toxicity, or "EPA toxicity" or words of similar import
under any applicable Environmental Laws);

                       (ii)        any oil, petroleum, petroleum fraction or petroleum derived
substance;

                     (iii) any drilling fluids, produced waters and other wastes associated
with the exploration, development or production of crude oil) natural gas or geothennal
resources;

                       (iv)        any flammable substances or explosives;

                       (v)         any radioactive materials;

                       (vi)        any asbestos~containing materials;

                       (vii)       urea formaldehyde foam insulation;

                      (viii) electrical equipn1ent which contains any oil or dielectric fluid
containing polychlorinated biphenyls;

                       (ix)        pesticides; and

                        (x)   any other chemical, material or substance, exposure to which is
prohibited, limited or regulated by any governmental authority or which may or could pose a
hazard to the health and saf-ety of the owners, occupants or any petsons in the vicinity of any
WOlic site or to the indoor   or
                             outdoor environment:                      .                      .




                                                     13



                                                                                              PVOG 15
                                                                                                         i·.·
                                                                                                         ~·.
                4.       In conducting its operations hereunder, Contractor agrees to comply with        i.
all Environmental Laws. Contractor agrees to report to Company, as soon as reasonably
practicable, all the details of every environmental upset or spillage and to fully cooperate in all
clean up and reclamation activities by providing .labor and equipment ~n order to restore and
protect the environment. Clean up and reclamation activities by Company Group shall not
relieve Contractor of its duties or liabilities under this Contract Contractor shall reimburse
·company Group for all such costs l'elated to clean up and reclamation by Company Group to the
 extent that such risk is allocated to Contractor herein.

       C.      General

       WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, THE
PARTIES EXPRESSLY ACICNOWLEDGE AND AGREE, AND HEREBY INTEND TO
CLEARLY AND UNEQUIVOCALLY AFFIRM, THAT THE APPLICATION OF THE
PROVISIONS OF TillS SECTION VII MAY INVOLVE (I) INDEMNIFICATION FOR
CLAIMS/LOSSES DUE TO THE INDEMNITEE'S OWN NEGLIGENCE, GROSS
NEGLIGENCE, STRICT LIABILITY OR OTHER FAULT, AS WELL AS
(II) INDEMNIFICATION FOR CLAIMS/LOSSES DUE TO THE NEGLIGENCE OF
OTHERS (i.e., TIDRD PARTIES). BOTH PARTIES AGREE THAT TillS STATEMENT
COMPLIES WITH THE REQUIREI\1ENT~ KNOWN AS THE "EXPRESS
NEGLIGENCE RULE," TO EXPRESSLY STATE IN A CONSPICUOUS MANNER
THAT ONE PARTY (I'HE INDEMNITOR) HAS RESPONSIDILITY FOR THE
NEGLIGENCE, GROSS NEGLIGENCE, STRICT LIABILITY OR OTIIER FAULT OF
ANOTHER PARTY (THE INDEMNITOR}.

Vill. FIDELITY
        Neither Contractor nor any of its subcontractors perfonning work or services hereunder
shal1 pay any commissions or fees or grant any rebates or other remuneration or gratuity to any
employee, dil'ector, agent or representative of Company m· to any member of the immediate
family of any of the foregoing persons. Neither Conu:actot nor any of its subcontractors
performing work or services hereU.nder shall pay any commissions or fees or grant any rebates or
other xemtmeration or gratuity to any employee, director, agent or representative of the other or
to any member of the imn1ediate family of any of the foregoing persons. Gifts of nominal value
and entertainment) meals and social invitations that are customary and proper under the
circumstances and do not place the recipient under obligation are acceptable. If any employee of
Company should soli9it a gift or gratuity from Contractor) then Contractor hereby agrees to
notify an officer of Company of such act, and Company agl'ees to hold such notification in
confidence. Failure by Contractor to comply with this Seciion VIII may, at the Company's
option, result in the termination of this Contract and may preclude any :further dealings between         !.
the parties. Company ~hall have the right to inspect and audit all records of Contractor, of
whatsoever nature, relating to ~y gifts or gratuities :fu:rtrlshed to any member of Company Group
at any time, and from time to time, while this Contract remains in effect and for a period of
two (2) years ther~after.




                                                 14




                                                                                               PVOG 16
 IX.     TERM
          This Contract shall have a term of one (1) year from and after the date hereof and shall
  continue. in full force and effect thereafter, on a year-to-year basis, unless sooner tenninated by
  the parties as hereinafter provided. It is understood and agreed, however, that either party hereto
  may tenninate this Contract at any tune by giving the other party at least thirty (30) days' prior
· written notice of such termination and that Company may terminate this Contract immediately if
  Contractor is in breach of any of the terms hereof. Notwithstanding the foregoing~ (i) the
  provisions of Sections II~ VI, VII) XITI, XIV, XVII, XVIII and XIX and Exhibit "D, shall
  survive the tennination of this Contract, and (ii) all of the tetms and conditions hereof shall
  survive the tennination of this Contract for all completed and cun·ent orders.

 X.      NOTICES

         Any and all notices req~1ired or permitted to be given hereunder shall be deemed to have
 been properly given when delivered via Federal Exp1·ess or similar courier, via telecopy to the
 address shown on the signature page hel'eto or via mail addressed, postage prepaid, to the
 add!'esses shown on the signature page hereto. Either party may change its address shown by
 giving written notice thereof to the other party.

 XI.     ASSIGNMENT
         Contractor may not alienate, transfer or assign any rights hereunder to any third party
 without the express mitten approval of Company, which approval may be withheld in
 Company's sole discretion. Any purported assignment without such \Witten approval shall be
 null and void. Except as limited by the foregoing, this Contract shall be binding upon the
 transferees, successors and assigns of the parties hereto.

 XII.    AUTHORITY OF EXECUTING PARTIES

         Each of the persons executing this Contract represents and wan·ants that he or she has full
 right and authority to execute this Contract on behalf of Company or Contractor:~ as the case may
 be, and to bind such party to the fulfillment of all of the provisions hereof.

 XIII.   AUDIT PROVISION

         Contractor shall maintain a tnte and correct set of records pertaining to its performance of
 services hereunder for a period of not less than two (2) calendar years following the end of the
 calendar year in which the final invoice for such services was sent. This two-year period is not a
 limitation on C01npany' s right to atldit. .Any representative or representatives authorized by
 Company may inspect and audit any and all records of Contractor pertaining to the goods and
 services provided under this Contract. Such inspection shall be conducted at Contractor's offices
 during normal business hours after 1·easonable notice. Contractor shall make a good faith effort
 to include a similar audit provision in its subcontracts. Contractor shall promptly reimburse
 Company for any overpayments discovered in the audit, and Contractor hereby waives any
 statute of limitations or laches concerning the same. In addition, all safety, environmental and
 health infonnation furnished by Contractor to Company will be subject to audit and shall be
 retained by Contractor for the same period or as otherwise required by Law.           ·


                                                  15




                                                                                                PVOG 17
XIV. APPLICABLE LAW

        This Contract may govetn goods and services supplied by Contractor to Company in
several different jurisdictions. W~th respect to the selection of the governing law in this
Section XIV, the parties stipulate that certainty of enforcement is an important expectation
negotiated between the parties in entering this Contract. Where any goods or service are to be
provided in a geographic location covered by the General Maritime law, General Maritime law
shall apply and shall govern the validity~ interpretation and perfmmance of this Contract. In
those instances where the General Maritime law does not apply, the Laws· of the State where the
principal work site is located shall apply and govern the validity, interpretation and performance
of this Contract. With respect to any govetning Laws that the parties select, the parties agree that
the Laws of the selected jurisdiction shall apply exclusive of any principles of conflicts of laws
that would require application of the substantive laws of another jurisdiction. References in this
Contract to any Law shall be deemed to include references to such as the same may be amended)
replaced or reenacted fi·om time to time.

XV.    WAIVEROFLIEN

        To the extent pe1.n1itted by Law, Contractor shall not encumber and shall not allow its
subcontractors to encumber Company's property. Whether a claim is valid or invalid) no lien,
privilege, charge or similar encun1brance shall become fixed upon Company) s leases, wells,
equipment, lands., :fixtures) improvements or other property because of the failure of any member
of Contractor Group to be paid for goods or services provided for hereunder. After being
notified ofthe existence of any such lien., privilege, charge or encumbrance, Contractor shall take
all necessary steps to obtain the release of such lien, ptivilege) charge or encumbrance.                 l
                                                                                                          i
Contractor shall ensure that all subcontractors, as a condition of providing work or services for         l

Contractor covered by this Contract, shall execute a Waiver of Lien Agreement in the form set
forth in Exhibit "B', hereto. Contractor shall provide Company with a list of subcontractors}
                                                                                                          r
together with documents evidencing that all laborers, subcontractors and suppliers of mate1ials
and equipment have been paid and are not claiming liens on Company's property for such labor,
services or materials under the provisions of applicable Laws.

XVI.   AFFILIATED COMPANIES

        Affiliates of Contractor may join this Contract (any such joining affiliate, a «Joining
Contractor") by executing a joinder hereto in the fom1 set forth in Exhibit ''C" hereto. and
f01warding it to Company. Any and all references to "Contractorn in thls Contract shall be
deemed to refer to Contractor or any Joining Contractor, as applicable to the particular work or
services performed hereunder. The liability of Contractor and any Joining Contractor under this
Contract shall be severaL) and not joint A.ccordingly, the obligations, representations, covenants
and agreements of Contractor and any Joining Contractor under this Contract are several and
relate only to the work or services perf01med or to be performed by Contractor or such Joining
Contractor under tlus Contract.




                                                 16




                                                                                                PVOG 18
                                                                                                         I~




 XVII. CONFIDENTIALITY                                                                                   i
                                                                                                         !·
                                                                                                         l
         A.     Infom1ation provided by Company to Contractor while performing services                  ~ ..
 (including> without limitation> information·regarding Companyts operations, a well being drilled,       :.!
 or geological· and/or geophysical information, such ·as the depth of a well, the formations
 penetrated, the results of coring) logging, testing and surveying) is proprietary to Company, and
 such information and the existence and terms and conditions of this Contract or any work or
                                                                                                         r
                                                                                                         :·
 services perfonned under this Contract e'Confidential Information'') are confidential. Contractor
 shall use Confidential Information only in connection with the work or services to be performed
 under this Contract, and Contractor shall not divulge Confidential Inf01mation and shall take all
 reasonable steps to assure that Contractor~s and its subcontractors, and their respective officers,
 directors, employeest ~gents, representatives, consultants and subcontractors, will not divulge
 Confidential Information to any person or entity other than Company's representatives.
 Contractor shall safeguard and protect all Confidential Information in its custody or control.
 Contractor's confidentiality obligation shall survive the termination of this Contract for five (5)
 years.

        B.      Contractor agrees that no adequate remedy at law exists for a breach or threatened
 breach of any of the provisions of tlus Section XVII, t11e continuation of which, ·if not remedied)
 will cause the non-breachlng party to suffer irreparable harm. Accordingly, Company and
 Contractor agree that Company shall be entitled, in addition to other remedies that may be
 available to Company, to immediate injunctive relief from any breach of any of the provisions of
 this Section XVII and to specific pe1formance of its rights hereunder, as well as to any other
 remedies available at law or in equity.
                                                                                                          '•.

 XVIII. ARBITRATION
          A.     Any disputes and claims arising out of or resulting from the performance of this
  Contract shall be resolved by binding arbitration, to be held in Housto~ Texas, as set forth
  beJow. If at any time any party shall desire to bring a claim against any the other party, and the
  parties cannot agree upon the resolution of such claim) then such claim shall be referred to a
  board of arbitrators (the "Board"). The Board shall be composed of one representative chosen by
  each party, and a third arbitrator who shall be chosen by the two arbitrators herein provided for.
  Each arbitrator shall be independent of the parties and shall have at least ten (1 0) years
  experience in the oil and gas business. In the event that the two arbitrators are unable to agree
  within ten (1 0) days upon a third arbitrator, then the American Arbitration Association shall
  designate a disinterested person to act as such arbitrator; and, in the event that the Receiving
  Party (as defineQ. below) should, for a period of ten (1 0) days after receipt of an Arbitration
  Notice (as defmed below), fail to select and make known in writing to the Notifying Party (as
  defined below) the arbitrator selected by the Receiving Party> the Board shall be comprised of
. the one sole arbitrator chosen by the Notifying Party. Either party {the ~~otifying Party") may at
  any time serve upon the other (the "Receiving Party,} a notice (an uArbitration Notice") setting
  forth the point or points upon which the decision of the Board is desired and the identity of the
  arbitrator chosen by the Notifying Party. Within ten (1 0) days after the date of such Arbitration
  Notice, the Receiving Party shall deliver a com:iter..notice to the Notifying Party which shall
  identify the arbitrator chosen by the Receiving Party, respond to the claim in the Arbitration



                                                  17




                                                                                               PVOG 19
                                                                                                         !.
                                                                                                         I




                                                                                                         J!
                                                                                                         .•..:
                                                                                                         ~


Notice and specify any additional points or differences arbitrable hereunder upon which the
Receiving Party may desire a decision.

        B.      . Promptly after the coJp.position of the Board has been identified, the Board shall
give the respective parties written notice of the time and place of arbitration hearing, which
hearing must take place .within six (6} months of the date of the Arbitration Notice, The parties
may then commence with and exchange requests for documents in accordance with: Rule .34 of
the Federal Rules of Civil Procedure. No other form of discovery, including, but not limited to,
interrogatories, requests for admissions, or depositions, shall be pe1mitted. The Board (or the
sole arbitrator, as the case may be) shaH conduct the arbitration heru..ing for as long as the Board
deems reasonably necessary and the parties shall be entitled to submit expert testimony and/or
written documentation in such hearing. The Board shall, by majority vote taken within two (2)
days after such hearing> select the position of one party with respect to the claim(s) and notify
both parties in writing of such selection. The decision of the Board (or the soie arbitrator) as the
case may be) shall be final, conclusive and obligatory upon the parties and their successors and
assigns, and without appeal, and each party agrees to abide by and comply with every such
decision. Judgment on the decision of the Board may be entered and enforced by a court of
competent jurisdiction. The costs ofboth parties in connection with any such arbitration shall be
paid by the losing party. Notwithstanding the requirement to arbitrate any dispute, any party
hereto may appty to a court for interim measures, such as injtmctions, attaclnnents and
conservation orders, which measures may be immediately enforced by comt order. Any decision
with respect to such interim measures shall promptly be referred to the Board for review and
final decision.

XIX. :tv1ISCELLANEOUS

        A.      The parties may, by mutual written agreement, amend this Contract in any
respect, and either party, as to such party, may (i) extend the lime for the performance of any of
the obligations of the other party; (li) waive any inaccuracies in representations and warranties
by the other party; (iii) waive compliance by the other party with any of the co:venants or
agreements contained herein ·and performance of any obligations by the other party; and
(iv) waive the fulfillment of any condition that is precedent to the performance by such party of
any of its obligations under this Contract. To be effective, any such extension or waiver must be
in writing and be signed by the party providing such waiver or extension, as the case may be. No
such. extension or waiver by any party, nor any waiver by any Pru:ty of any breach of any
provision of this Contract, shall operate or be construed as a waiver of any subsequent breach,
whether or not similar. No failure or any delay by any pru.ty in exercising any right, power or
privilege under this Contract shall operate as a waiver of such right) power or p1ivilege, and no
single or partial exercise of any such right, power or privilege shall preclude any other or further
exercise of such rigbt, power or privilege or the exercise of any other right, power or privilege.
Except as otherwise 1)rovided in this Contract, the rights and remedies herein provided are
cumulative and are not altel'native.

       B.     The headings, sub-headings and other s~bdivisions of this Contract are inserted
for convenience of reference orily. The parties do riot intend them to be· an aid in legal
construction.



                                                 18



                                                                                               PVOG 20
         C.      All references to cash or monetary amounts refer to U.S. Dollars only unless
specifically stated to be in the currency of anothe1' govennnent. The words Hthls Contract,'~
'~herein,,) "hereby,') "hereundet, and ~'hereof:" and words of similar import, refer to this Contt.·act
as a whole and not to any particular subdivisio11, unless expressly so limited. The wprds "tllis
Article," '~this Section~' and "this subsection," and words of sirnllar import, refer only to the
Articles, Sections or subsections, respectively, hereof in which such words occur. The vvord
"including'~ (in its various forms) means "including without lhnitation., Any reference to any
federal, state or local Law shall be deemed also to refer to all rules and regulations promulgated
                                                                                                             i
thereunder, unless the context requires otherwise. Pronouns in masculine, feminine or neuter                 !·

genders shall be construed to state and include any other gender and words, terms and titles
(including terms defined herein) in the singular fonn shall be construed to include the plural and
vice versa, unless the context otherwise expressly requires. Unless the context otherwise
requires~ all defined terms contained herein shall include the singular and plural and the
conjunctive and disjunctive forms of such defined terms.

        D.     Except for the designation of the work or service to be performed and the
consideration provided for h1 Section I, it is understood and agreed between the parties hereto
that this Contract constitutes the sole and complete basis· for the agreement between the parties
and that no other representations of any kind, oral or otherwise, have been made to Contractor.

       E.      In the event one or more of the provisions contained in this Contract shall be held,
for any reason, to be invalid, void, illegal or unenforceable in any respect, such invalidity,
voidness, illegality or 1Ulenforceability shall not affect the remaining provisions hereof, and this
Contract shall remain unaffected and shall be construed as if such invalid~ void, illegal or
unenforceable provision never had been contained herein.

        F.      No consideration shall be given to the fact or presumption that one party has a
greater or lesser hand in drafting this Contract.

      G.    Tins Contract represents a final, complete and exclusive statement of the agreement
between the parties, supersedes any prior oral or written representation, agreement or
understanding between the parties, and may not be modified, supplemented, explained or waived,
except in writing signed by an authorized representative of both parties.

       H.      This Contract may be executed in any number of counterpatts> and each such
counterpart shall be deemed an original of this Contract for all purposes. No party shall be
bound to this Contract unless and until all parties have executed a: counterpart. A signature page
signed by a party and sent by facsimile or other electric transmission to the other party shall be
deemed to be valid as an original and shall be binding as between the parties.

     I.  IN SIGNING TIDS CONTRACT, CONTRACTOR EXPRESSLY
ACKNOWLEDGES THAT IT IS AWARE OF ITS RIGHT TO OBTAIN LEGAL
COUNSEL TO REVIEW TillS CONTRACT. FURTHERMORE, CONTRACTOR
EXPRESSLY ACKNOWLEDGES THAT IT HAS READ AND UNDERSTANDS ALL OF
THE PROVISIONS CONTAINED IN TIDS CONTRACT, INCLUDING WITHOUT
LIMITATION, THE INDEMNITY AND RELEASE PROVISIONS, AND AGREES TO



                                                   19




                                                                                                   PVOG 21
           ALL SUCI! PROVISIONS, AS INDICATED BY THE SIGNATURE OF ITS
           AUTHORllZED REPRESENTATJLVE BELOW.
                                                                                                  l

                                                                                                  !'
-----------·~-Additional-ptovisions;-ifany;-are-attached-hereto-as-Exhibiti..'D~-----------------t-­
                                                                                                  i
                                                                                                  ~
                                       [Signature Pages Follow]                                   !
                                                                                                  i
                                                                                                  i




                                                  20



                                                                                     PVOG 22
-:--------"""""""""""""_   _..........,....=....,.,..---.,----------_....,.-..........,-._-~_....,.,.---·----·-~--·--~'-=---''-,
                                                                                                                                          I
                                                                                                                                          I
                                                                                                                           i              !


                                                                                                                           I·:            I
                                                                                                                                          I


                                                                                                                           rI•            i

                      IN WITNESS WHElrnOF, the pl:ll'ties hereto have executed and delivered this Contract                 l
                                                                                                                                          :

              effective as ofthe date fil'st hereinabove shown.
                                                                                                                           \. r.
                                                           COMPANY:                                                        ..
                                                                                                                                          r
                                                                                                                                          f
                                                                                                                           i
                                                          PENN VIRGINIA OlL & GAS CORPORATION.                              ~             1
                                                                                                                            (
                                                                            VI{
                                                          By~·-------it=:;;..._---===-­
                                                                                                                            !' :          !:
                                                                 Name:                                                      i
                                                                                                                               I
                                                                                                                                          i
                                                                 Title:

                                                              Address:          840 Gessner> Suite 800                     ! ..
                                                                               Houston, TX 77024                                              >·
                                                                                                                               !·
                                                              Telepl1one:      (713) 722-6500
                                                              Telecopy:        (713) 722-6600                                                 :.•



                                                                                                                           l
                                                                                                                               I t~:~
                                                              WITNESS OR ATTEST:
                                                                                                                                              .·
                                                                                                                                :
                                                                                                                                i
                                                         . Name: C .....~··     Jean M. Whitehead                               I
                                                                        ·      · (Please Print)                                 l             j\
                                                                                                                                !I
                                                                                                                                !             ;~
                                                                                                                                              ..
                                                                                                                                i
                                                              PENN Vffi.GINIA OIL & GAS, L.P                                    !
                                                              By:  Penn Virginia Oil & Gas GP LLC,                                            (~
                                                                       its general partner                                                    ..
                                                                                                                                              ..
                                                                                                                                   ..
                                                              By,
                                                                    Name:
                                                                             lJI\_d?r"
                                                                              Nancy M. Sfiyder                                                :
                                                                                                                                               l;r

                                                                    Title:    Executive Vice President                                         .::

                                                              Address:          840 Gessner, Suite 800                              i.
                                                                                Houston, TX 77024                                   r          ~·


                                                              Telephone:
                                                              Telecopy:
                                                                                (713) 722..6500
                                                                                (713) 722.. 6600
                                                                                                                                               ;~
                                                                                                                                               ::
                                                                                                                                               :·~
                                                                                                                                    \:·
                                                              WITNESS OR ATTEST:                                                               ~-:
                                                                                                                                    ~·~
                                                                                                                                    I

                                                                                                                                    r·

                                                          ·
                                                                    ~~.~~
                                                              Name:~Jean.M.
                                                                      Whitehead ·
                                                                       -,       (Please J?rlnt)

                                          Signature Page to Master Service Contract




                                                                                                            PVOG 23
                                                                                              i.
----:-------.----:------~-----------------------.......,..                                    .\:
                                                                                               ;.
                                                                                               ~:-
                                                                                               l
                                                                                               :J.




                                   PENN VIRGINIA MC ENERGY L.L.C.

                                   By:_ _~"---~~·~-______...,::;;;..._
                                                             _ _-_-_
                                      Name:
                                      Title:                                         .   i
                                                                                         :
                                                                                         i
                                                                                         i
                                   Address:       840 Gessner, Suite 800
                                                  Houston, TX 77024                      !i
                                   Telephone:     (713) 722-6500                         i
                                   Telecopy:      (713) ?22-6600


                                    PIITNESSORATTES'f:




                                    CONTRACTOR:



                                    By:_______________________
                                    Name: _ _~---------
                                    Title:._ _ _ _ _ _ _ _ _ _ _ __

                                    Address:

                                    Telephone:
                                    Telecopy: ·


                                    WITNESS OR ATTEST:

                                                                                              .:
                                    Name:,_ _ _ _ _ _ _ _ _ _ __
                                                   (Please Print)




                    Signature Page to Master Service Contract




                                                                           PVOG 24
                l?ENN VIRGINIA MC ENERGY L~L.C.


                By:·----~~--~-----------
                   Name: Nancy Snyder   M:
                 · Title: Executive Vice President

                Address:          840 Gessner, Suite 800
                                  Houston, TIC 77024
                Telephone:        (713) 722-6500
                Telecopy;         (713) 722-6600


                 WITNESS OR ATTEST:



                ·Name:_ _"'"'.~Jean~..:.;M.~w!.!:;·-~h:i~tee;h~ea~d~--­
                              (P1ease Print)


                 CONTRACTOR:




                 Address;         515 W. Greens Road, Suite 1170
                                  Houston1 Texas 77067
                 Telephone:.      281-775-5124
                 Telecopy:        281-775-4855


                 Wri'NESS OR ATTEST:




Signature .Page to Master Service Contract




                                                                          PVOG 25
                                                                                                        /·.:~


                                       EXIDBIT "A"

                      MINIMUM INSURANCE REQUIREMENTS

      The following minimmn insurance requirements shall be complied with by Contractor
and Company:

A.    General Requirements (Applicable to all policies of Contractor and Company)

      1.     Contractor agrees that all of Contractor,s insurance policies (with the exception of
             Workers' Compensation policies and only with respect to coverages and
             applicable minimum limits required in this Contract) shall be endorsed to-
             specifically name the Company Group as Additional Insureds thereunder. As
             used herein, "Company Group" shall have the meaning set forth in
             Section VI(A)(l) of the Contract. Company agrees that all of Company's
             insul'ance policies (with the exception of Workers' Compensation policies and
             only with respect to coverages and applicable minilnum limits required in this
             Contract) shall be endorsed to specifically name the Contractor Group as
             Additional Insureds thereunder. As used herein, "Contractor Group" shall have
             the meaning set forth in Section VI(A)(2) of the Contract. For aU insurance
             policies where an additional insured has been named, such insurance policies shall
             also contain a separation or severability of interest clause (sometimes called cross
             liability coverage) so that each insm·ed shall be treated separately under the
             policy. This provision shall not cause any change of the insured risks or any
             change :in the amount of insurance provided.

      2.     All policies shall contain a waiver of subrogation in favor of Company Group or
             Contractor Group) as the case may be~ including their respective insurers.

      3.     All policies cru.tied by each party shall provide thirty days' Wl'itten notice to the
             other party of cancellation or any material changes.

      4.     Coverage. under all insurance required to be carried by Contractor or Company
             shall be primary to, and receive no contribution from) any other insurance
             maintained by or on behalf of> or benefiting Company Group or Contractor
             Group. In addition, neither Contractor Group nor Company Group shall be
             responsible or liable for any deductibles, self-insured retentions and/or premiums
             of the other Group,s insurance.

      5.     All policies required to be carried by the parties shall have adequate territorial and
             navigational limits for the location of the work.

      6.     In all cases where either party has assumed responsibility through an indemnity
             obligation or other promise, its insurance coverage shall b(! deemed primary.

      7.     Company will maintain, at Company's expense, Operators Extra Expense (OEE)
             or Energy Exploration and Development (EED) insurance covering the liabilities


                                              A-1




                                                                                              PVOG 26
             specifically assumed by Co1npany in this Agreement, including but not limited to
             those related to well control issues (including Underground Control of Well); Re-
             drilling/Ex.tra Expense (including Unlimited Re-drlll); Seepage and Pollution;
             Cleanup and Containme11t; and such other extensions of coverage as may be
             considered appropriate in the amounts listed below:

             (a)    For work outside of cased hdle:

             $10 million for work outside of cased hole

             (b)     For work fuside of cased hole:

             $10 million for work inside cased hole in wells with a total measured depth
             greater than 15,000;

             $5 million for work inside cased hole in wells with a total measured depth greater
             than. 9,500' but equal to or less than 15,000,;

             $3 million for work inside cased hole in wells with a total measured depth of
             9,500' or less;

             (c)    Notwithstanding the above) $5 million for stimulation, cementing,
             wireline, or coil tubing services.

B.   Worker's Compensation and Occupational Disease Insurance in accordance with the
     statutory requirements of the state in which work is to be performed, the state in which
     the insured party's employees reside and the state in which the insured party is domiciled;
     Employer's Liability insurance with limits of not less than $1,000,000 per accident or
     occUlrenceincluding:

     (i)     Coverage amended to provide that a claim In Rem shall be treated as a claim
             against the employer.
     (ii)    Borrowed Servant/Alte1nate Employer endorsement
     (iii)   Other States coverage.
     (iv)    Stop Gap Liability- monopolistic states (if applicable) .
     (v)     Territorial extensions to cover all work areas including, when applicable, the Gulf
             of Mexico

     In the event any watercraft or offshore services are to be provided by Contractor,
     Contractor shall also obtain:

     (i)     Protection for liabilities under the United States Longshore and Harbor Workers'
             Co1npensation Act and the Outer Continental Shelf Lands Act.
     (ii)    Coverage for liability tmder the Merchant Marine Act of 1920:. commonly known
             as Jone~ Act; the Admiralty Act; and the Death on ~gh Seas Act with li~ts of
             not less than $1,000,000 per accident                           ·
     (iii)   Protection against maritime liability of employer to provide transportation, wages,
             maintenance and cure with. a minimum of$1,000,000.


                                              A-2




                                                                                           PVOG 27
==;o=.--=-====-----~-------------- ~-·------····-······-·"                ..

                                                                                                                  .•
                                                                                                                  •.
             (iv)    Voluntary Compensation Maritime endorsement.

             If either party obtains its employees from any employee leasing company or similar type
             arrangement, such party. shall require that the employee leasing company provide all of
             the same coverages and endorsements enumerated in this Exhibit A in accordance with
             all ?fthe General Require~ents of this Exhibit A.

        C.   Comprehensive General Liability Insurance, with limits of $2,000,000 per occurrence
             combined single limit for both Bodily Injury and Property Damage, including the
             following coverages:

             (i)    Premises and operations coverage
             (ii)   Independent Contractors coverage
             (iii)  Contractual Liability coverage
             (iv)   Products/Completed Operations coverage
             (v)    Liability for nx, ~ ucu and "U', (Explosion, Collapse and Underground)
             (vi)   Broad Form Property Damage Liability
             (vii)  Personal Injury liability
             (viii) In Rem endorsement
             (ix)   Territorial extensions to cover all work areas including, wheq applicable, the Gulf
                    of Mexico
             (x)    Actions Over Indemnity buyback coverage
             (xi)   Underground Resources and Equipment coverage
             (xii) Punitive Damages coverage
             (xiii) Seepage and pollution coverage- sudden and accidental basis
             (xiv) Blowout and cratering coverage

             In the event any watercraft or offshore services are to be provided by Contractor>
             Contractor shall ensure that the watercraft exclusion is deleted.

        D.   Comprehensive Automobile Liability Insurance cover.ing all o~ed! non-owned and
             hired vehicles, including broadened pollution coverage, with a minimum combined single
             limit of$1)000,000 per occurrence for both bodily injury and prope1ty damage.

             If the insured party is a n1otor carrier, then such party shall carry those limits and types of
             coverages as specified by applicable federal, state and local laws and regulations.
             Further, if the insured is a motor canier, then it shall name the other party's Group as
             additional insured and waive subrogation against the other party's Group only to the
             extent permitted by applicable Laws.

        E.   If Contractor is a professional services finn, Profession Liability Insurance, with limits of
             not less than $5,000,000 per occurrence.

        F.   If either party owns or operates vessels to provide services or conduct operations for
             Company, such pru.ty shall calTy:




                                                                                                        PVOG 28
                               -- -------·-------.,..,.


                                                                                                        l
                                                                                                        '·
     (i)     Hull and Machinery Insurance with coverage eq~al to that provided by the
             American Institute Hull Clause (6/77) including limits of liability at least equal to
             the full value of the vessel and with navigation limits adequate for contractor to
             perform the contract~d work. Where the vessel is engaged in towing operations7
             the insurance shall include full Tower's Liability with the sistership clause
                                                                                                        ;
             unamended.
                                                                                                        r
     (ii)    Protection and Indemnity Insurance with limits of $1,000,000 combined single               !'
             limit per occurrence, including, but not limited to, coverage for contractual
             liability for those liabilities assumed by the insured party, liability for pollution ·
             and cleanup on a sudden and accidental basis as per WQIS policy form or
             equivalent, full crew coverage, Collision and Tower's Liability ·and Cargo Legal
             Liability. The parties shall also carry Voluntary Removal of Wreck/Debris
             Insurance covering their equipment in an amount not less than $10,000,000 per
             occurrence.

     (iii)   All policies and coverages required under this Paragraph F shall be endorsed as
             follows:

             (a)     to provide full coverage to the other party's Group as additional insured
                     without limiting coverage to liability "as the owner of the vessel" and to
                     delete any "as owner" clause and any other language purporting to limit
                     coverage to liability of an insured "as ovmer of the vessel',.

             (b)     to delete any language limiting coverage fol' the other party's Group in the
                     event of the applicability of a limitation of liability statute.

G.   If either party owns or operates aircraf4 including helicopters, to provide services to or
     conduct operations for Company, such party shall carry:

     (i)     Aircraft liability insurance covering aU owned, non-owned and hired aircraft with
             a minimum combined single limit of $10,000,000 per occurrence. Such policy
             shall be endorsed to provide coverage in all tenitories where Contractor provides
             services to or conducts operations for Company.

     (li)    General/airport liability insurance including premises/operations, products,
             contractual) independent contractors and hangers' keepers, liability witlt a
             mirrimum combined single limit of$10,000,000 per occurrence.

     (iii)   All Risks Hull Insurance for an agreed value, including> without limitation)
             coverage for collision liability.

H.   Umbrella/Excess Liability Insurance with limits not less than $5,000,000 each
     occurrence/aggregate where applicable to be excess of coverage and limits required in
     Paragraphs A through G.

I.   Physical Damage Insurance on the insured's own property to the extent of its replacemep.t
     cost.


                                                 A-4




                                                                                              PVOG 29
------:--~-------=~""""""-~--""""'-··.-~---~··-.----···




          J,   The foregoing MinilnUm Insurance Requirements are subject to change at the direction of
               Company, and Company reserves the right to require cetiified copies of any or all
               policies.




                                                     A-5




                                                                                                  PVOG 30
                                         EXHIBIT "B"

                             WAIVER OF LIEN AGREEl\1ENT

STATES OF _____________________________                                                                 ·.
                                                                                                        ...
COUNTffiS~ARlSBESOF          ___________________________

KNOW ALL :MEN BY THESE PRESENTS THAT:

        WFIEREAS,                                   , a                              corporation,
whose address is                                                      (hereinafter referred to as
"Contractor~)), and PENN VIRGINIA OJL & GAS CORPORATION, a Virginia corporation
with offices in Houston) Texas, PENN VlRGINIA OIL & GAS, L.P., a Texas limited partnership
with offices in Houston, Texas, and PENN VIRGINIA MC ENERGY L.L.C., a Delaware
limited liability company with offices in Houston, Texas (hereinafter collectively referred to as
((CompanyH)t have entered into a Master Service Contract (the "Master Service Contract")
whereby Contractor has agreed to provide work and services in various co1.mties in the State(s) of
_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _;and

        WHEREAS, under the Master Service Contract, Contractor must submit to Company a
list of subcontractors to be used in the performance of such work and services, together with
doctunents evidencing that all laborers, subcontractors and suppliers of materials and equipment
have been paid and are not claiming liens on Company>s prop~rty for such labor, services or
materials under the provisions of the applicable Constitution, Statutes~ Rules and Regulations of        ;.
such State(s); and

       WHEREAS, the undersigned                                     a---------
corporation (hereinafter referred to as "Subcontractor,'), has petformed and/or fumished or
agreed to perform and/or finnish labor, services, eq·uipment, material or supplies or any
combination of the foregoing for the work or services; and

        WHEREAS, Subcontractor wishes to be considered by Contractor for some of the labor,
services or materials to be performed and/or ftunished to Contractor for the work or services.

        NOW, THEREFORE) for and in consideration of $10 in hand paid to Subcontractor by
Contractor on behalf of Company, and in consideration of the purposes and objectives
hereinabove expressed, Subcontractor hereby agrees with Contractor for the benefit of Company,
as follows:

       1.      Subcontractor hereby waives and relinquishes all rights to assert each and every
mechanics=- materialmen, laborers and other liens provided for by the Constitution, Statutes,
Rules and Regulations of the State of                                     which it may otherwise
be entitled to for the labor, services, materials or supplies performed and furnished or to be
performed and furnished in the performance of work or services insofar only as such liens (or
any of them) apply to property or equipment of Company and/or proceeds therefrom owned by
Company up to the full amount due for labor, ~ervices or supplies, principal and interest, and any ·

                                               B-1




                                                                                              PVOG 31
===-'""""'~===,..,......--...,--- . . . . . . .....------~------~~--==....,.=-...=~· ---~------·------·-----

                                                                                                                      !~

             statutory attorney~s fees due Subcontractor. Notwithstanding the foregoing, Contractor and
             Subcontractor hereby agree that all remedies of Subcontractor against Contractor shall remain in
             effect and are not waived or impaired by execution of this waiver.

                    2.     Suboontractor agrees that Company may pay the full Contract price to Contractor
             and that Subcontractor relieves Company of any responsibility tbr seeing to the distribution of
             such Contract funds and Subcontractor jndemnifies Company from any loss, cost or expense for
             having paid the Contract price to Contractor and agrees that it will look solely to Contractor for
             payment.

                     3.     Subcontractor recognizes and agrees that Contractor and Cmnpany are not joint
             venturers nor a partnership and that debts· due and owing to Subcontractor by Contractor for the
             work or services are exclusively the debts of Contractor contracted by Contractor on its own
             behalf and not as an agent, representative or partner of Company.

                    4.       Contractor hereby agrees that it will be liable to Subcontractor only in accordance
             with the contract between Contractor and Subcontractor and represents that it is not acting as
             agent or as a partner or joint venturer with or for Company.

                    5.      Notwithstanding the foregoing, if for any reason Subcontractor shall acquire a lien
             on the property or equipment of Company, then Subcontractor agrees to subordinate such lien to
             Company's ownership interests within ten (1 0) days after request therefo1· by Contractor or
             Company.

                                                 [Signature Page Follows]




                                                                                                                       "
                                                                                                                       :·:




                                                             B-2




                                                                                                            PVOG 32
                                         ·---~-··-- ... ---·-,----··~~.-........... '\>,................   ~   ................... - ....... ~




          IN WITNESS WHEREOF this agreement is executed by Subcontractor and Contractor
on this           day of                 2fH_.


                                          SUBCONTRACTOR:




                                          By:_ _ _ _ _ _ _ _ _ _ __
                                              Name:
                                              Title:


                                          WITNESS OR ATTEST:



                                          Name: _ _ _ _ _ _ _ _ _ _ __
                                                              (Please Print)


                                          CONTRACTOR:




                                          By: _ _ _ _ _ _ _ _ _ _ __
                                               Name:
                                               Title:


                                          ff'ITNESS OR ATTEST:



                                          Nrune:______________________
                                                     (Ple.ase Plint)




                                             B-3




                                                                                                           PVOG 33
                                                                           -·-········-----··"·   --·-·---·---




                                       EXHIBIT "C"

                     JOINDER TO MASTER SE~VICE CONTRACT

                                                        a                          corporation
("Joining Contractor',} hereby JOms in that certain Master Service Contract dated
______, 201_, by and among (i) Penn Virginia Oil & Gas Corporation, a Virginia
corporation, Pe1m Virginia Oil & Gas, L.P., a Texas limited partnership, and Penn Virginia MC
Energy         L.L.C.,     a      Delaware       .limited     liability     company,       and
(ii)                                                 a                             corporation
("Contractor"), as amended or supplemented prior to the date hereof and in effect on the date
hereof(as amended or supplemented, the "Master Service Contract"). Joining Contractor hereby
ratifies, confirms and adopts the Master Service Contract and agrees to be bound by all of the
obligations, covenants, terms and conditions contained therein that apply to "Contractor" as
though an original party thereto.

       Executed effective as of _ _ _ _ _ 201_.
                                             _;>




                                           JOINING CONTRACTOR:




                                           By: _ _ _ _ _ _ _ _ _ _ _~
                                               Name;
                                               Title:


                                            WITNESS OR ATTEST:


                                           Name:.___________________________
                                                       (Please Print)




                                               c


                                                                                                  PVOG 34
                                  ADDITIONAL PROVISIONS


. FORCE MAJEURE .

Except for the indemnification provisions under this Contract and the duty to make payrnents for
services already provided along with force majeure or standby payments during the Force
Majeure Event, neither Company nor Contractor shall be responsible to the other for any delay,
damage or failure caused by or occasioned by a Force Majeure Event. As used in this Contract,
"Force Majeure Event', includes acts of God, action of the elements, warlike action, insurrection,
revolution or civil strife, piracy, civil war or hostile action, strikes, differences with workers, acts
of public enemies, acute and unusual labor, material or equipment shortages, or any other <?auses
(except financial) beyond the control of either party. Delays due to the above causes, or any of
them shall not be deemed to be a breach of or failure to perfopn under this Contract. Neither
Company nor Contractor shall be required against its will to adjust any labor or similar disputes
except in accordance with applicable law.

BREACH SHALL NOT UVIP AIR

TO THE EXTENT ALLOWED BY APPLICABLE LAW, IT IS THE INTENT OF THE
PARTIES THAT ALL INDEMNITY OBLIGATIONS AND LIABILITIES ASSUMED BY
SUCH PARTIES UNDER TER.IvfS OF THIS AGREEMENT, .BE WITHOUT LIMIT AND
Wl1HOUT REGARD TO TI-IE CAUSE OR CAUSES THEREOF (INCLUDING BUT NOT
LIMITED TO PREEXISTING CONDITIONS), STRICT LIABILITY, REGULATORY OR
STATUTORY LIABILITY, ANY BREACH OF CONTRACT, BREACH OF
REPRESENTATION OR WARRANTY (EXPRESS OR llvfPLIED), OR THE WILLFUL
MISCONDUCT OR NEGLIGENCE OF ANY KIND OR CHARACTER OF ANY
INDEMNIFIED PARTY OR PARTIES (lNCLUDING, WITHOUT LIMITATION, WHETHER
SUCH NEGLIGENCE BE ORDINARY OR GROSS; SOLE, JOINT, OR CONCURRENT; OR
ACTIVE OR PASSIVE).




                                                  D-1




                                                                                                   PVOG 35
  NABORS DISPUTE RESOL.UTION
     PROGRAM and RULES




Copies o.f this pa1nphlet are available -in Spanish upon
    request, from any Nabors subsidia1~y S Ifu1nan                                        1



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                                                                                                                EXHIBIT
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     THE 1     BORS DISPUTE RESOLUTION PJ                         GR.o\M

1.     Purpose and Construction

      The .Program is designed to provide a means for the quick,
      fair, accessible, and inexpensive resoluti_on of Disputes
      between the Company              and    the Cpmpany 's
      present and forn1er Employees and · Applicants for
      en1ployment, related to or arising out of a current~ fonner
      or potential employment relationship with the Company.
      The Program is intended to create an exclusive procedural
      mechanis1n for the final resolution of all Disputes falling
      withit1 its terms. It is not intended either to abridge or
      enlarge substantive rights available under applicable· law.
      The Program contra.ctually modifies the "at-will') elnploy-
····"-~rttent'"'Yelatitrnsiri};r-~hetvte'en:··-"-tbe·, ·eompa:uy·~~·and··c.its~"'   ·
      Employees, but only to the extent expressly stated in the
      Program. The Program should be interpreted in accor-
      dance with these purposes.

2.    Definitions

      A.   "AAA'~   means the Alnerican Arbitration Association.

      B. 'tJAl.\18" means Judicial Arbitration and 1v1ediation
         Services.

      C. The ''Act" means the Federal Arbitration Act,
         9 U.S.C.§l, et seq., as amended from time to time.

      D. "CompanyH means Sponsor and every direct or
          indirect subsidiary (whether a corporation~ limited
          liability company, con1pany partnership or other legal
         entity) of Sponsor, any Electing Entity, any entity or
         person alleged to have joint and several liability
         concerning any Dispute, and all of their directors~
         officers, employees, and agents, every plan of bene-
         fits, \Vhether or not tax-exempt, established or main-
         tained by any such entity> the fiduciaries) agents and
         employees of all such plans, and the successors and
         assigns of all such entities, plans and persons; provid-
         ed~ however, that in the case of an Electing Entity,
         "Company" shall include the Electing Entity only to
         the extent provided in the Electing Entity's agreetnent
         to be bound by fue Program.

      E.   ·~Dispute''  means all legal and equitable clairns,
           dern,ands 1 and controversies} of Wl-latever nature or
           kind, whether in contract, tort, under statute or regu-
           lation~ or some other law, between persons bound by
           the Progran1 or by an agreen1ent to resolve Disputes
           :ler the Program, or between a person t nd by the
        Progran1 and a person or entity othezv.rise entitled to
        its benefits, including, but not lhnited to~ any
        matters ·with respect to:

        1.    this Program;

        2.   the employment or potential reemploym.ent of an
             Employee, including the tenns, conditions~ or
             termination of such employment with the
             Com.pany;

        3.   employee· benefits or incidents of employment
             \Vith the Company;

     :~~-4:- -- any·-other·'matter"Tefated·"to- ·or· concernilig.···the   ··---'~-­
                relationship between the Employee and the
             Company including~ by way of example and
             without limitation~ allegations of: discrimination
             based on race, sex~ religion, national origin~ age,
             veteran status or disability; sexual or other kinds
             of harassment; workers' compe11sation retalia-
             tion; defan1ation; infliction of emotional distress,
             antitrust claim concerning wages or otherwise, or
             status, claim or membership vvith regard to any
             employee benefit plan;

        5.   an Applica:nfs application for employment and
             the Con1pany's actions and decisions regarding
             such application; and

       6.    any personal injury allegedly incurred in or about
             a Company workplace or in t11e course and scope
             of an En1ployee~s employment

       "Dispute" includes all such matters regardless of
       when the events on which they are based occurred,
       including matters based on events occurring before
       the E1nployee became subject to this Program (so
       long as such disputes v;,rere not previously asserted in
       a judicial forum) or after termination of the employ-
       ment relatim1shlp.

F.     "Electing Entity~, means any legal entity that has
       agreed to be bound by the Program as provided herein.

G. "E1nployee'' n1eans any person ·who is or ha~ been in
   the employment of the Company on or after the effec-
   tive date of this Program, \Vhether or not employed at
   the tin1e a daim is brought with respect to a Dispute,
   residing in the United States, or othervvise subject to
              laws of the United States or any state,· 1icipality,
          or other political subdivision of the Unitea State-s.

      II. "Applicanf' rneans any person who is seeking or has
          sought employment with the Company after the effec-
          tive date of this Program.

     I.   "Party" m.cans~ \Vith respect to a particular Dispute,
          affecte.d persons and/or entities bound by this
          Progratn.

     J.   "'Progr8.1n~'means this Nabors Dispute Resolution
          Progra1n, as an1ended fi:mn tin1e to thne.

     K. aRules" means the Nabors Dispute Resolution Rules)
      .. "as amended from time .tothne. . which ~rt; gppli.q~b.t~J9 ."
          mediation and arbitration.

     L. ''Sponsor,' means Nabors I11dustries~ Inc.) a Delaware
        corporation.

3.   Nan1c, Application and Coverage

     A. TI1e Program shall be referred to as the ~'Nabors
        Dispute Resolution Program." Alternatively, it may
        be referred to as the 'Tii:;pute Resolution Program.~·

     B. Until revoked by Sponsor pursuant to this Progrru.nt
        this Program applies to and hinds the Company~ each
        Employee a11d Applicant and the heirs~ beneficiaries
        and assigns of any such person or entity; provided~
        however> that this Program shall noi apply to any
        Employee in a unit of Employees represented by a
        labor organization, or to the Cmnpany V\:ith respect to
        such en1pJoyees, except to the extent penniited in an
          applicable collective bargaining agreement or lawfully
          imposed by the Company \Vhen no collective bargain-
          ing agreeme_nt is in effect

     C. Except as provided for herein~ this Program applies to
        any Dispute.

     D. Notwithstanding anything to the contrary iu this
        Progn1n1.> the Progrru.n does not apply to cla.ilns for
        \vorl,<ers ~ compensation bene~ts or unemployment
        co1npensatiot1 benefits.

     E. 1\t!cdiation and arbitration are 01aly available for
        J?i.sputcs involving legally protected rights.
       F.      twithstanding any other provrs1o11    ~   ·eof, any
            court with jurisdiction over the Parties may issue any
            injunctive orders (including preliminary injunctions)
            if the necessary legal and equitable requirements
            under applicable law are met pending the institution
            of proceedings under the Pro gram. Furthermore, an
            action under The Lilnitatien of Ship Owners Liability
            Act, 46 U.S.C. §§181-189, shall not be subject to this
            Program.

 4.   Resolution of Disputes

      All Disputes not otherwise· settled by the Parties shall be
      fmaUy and cortclusive~y resolved under this Program and
      the Rules.

 5.   No Retaliation

      No employee shall be subject to any form of discipline or
      retaliation for initiating or participating in good faith in
      any process or proceeding under this Progrron.

6.    Antendment

      A. This Program n1ay be amended by Sponsor at any
         tin1e by giving at least 10 days' notice to current
         Employees. Ho\:vever1 no amend1nent shall apply to a
         Dispute for which a proceeding has been initiated
         pursuant to the Rules, unless otherwise agreed.

      B. Sponsor may amend the Rules at any time by serving
         notice of the am.endn1ents on AAA and JAMS.
         However~ no runendment of the Rules shall apply to a
         Dispute for which a proceeding has been initiated
         pursuant to the Rules unless othen:vise agreed.

7.    Termination

      This Program may be terminated by Sponsor at any time
      by giving at least 10 days'notice of termination to c.urrent
      E1nployees. However; tem1ination shall not be effective
      as to Disputes for which a proceeding has been initiated
      pursuant to the Rules prior to fue date of termination
      unless otherwise agreed.

8..   Applicable Law

      A. The Act shall apply to this Prognun, the Rules, and
         any proceeditlgs under the Program or the Rules,
         includL1g any actions to co1npel! enforce) vacate or
         confirm proceedings, a\:vards, orders of an arbitrator,
         or settle1nents under the Prograrn or the Rules,
              1
      B.       .   arbitrations held pursuant to this Prot   n shall be
           convened as near as possible to the worksite where
           the events in. dispute occurred if Nabors continues to
           perfonn work at that location. Otherwise the
           arbitration will occur at the place most convenient for
           the majority of the witnesses.

      C. Other than as expressly provided herein, or in the
         Rules, the substantive legal rights, remedies> and
         defenses of all Parties are preserved. In the case of
         arbitration, the arbitrator shall have the authority to
         detem1ine the applicable law and to order any and all
         relief, l~gal or equitable) which a Party could obtain
         from a court of competent jurisdiction on the basis of
           the claims made in the proceeding.

     D. Other than as expressly provided herein., or in the
        Rules, ·the Program shall not be construed to grant
        additional substantive~ legal.~ or contractual rights~
           remedies or defenses which would not be applied by
           a court of competent jurisdiction in the absence of the
           Program.

     E. Notwithstanding the provisions of the preceding sub-
        section) in any proceeding before an arbitrator~ the
        arbitrator~ in his or her discretion, may allow a
        prevailing Employee or Applicant a reasonable
        attorney's fee as part of the award. The discretion to
        allow an award of fees under this subsection is in
        addition to any discretion, right or power which the
           arbitrator may have under applicable law. If the
           arbitrator awards attorney fees withou~ authorization
           for such an award by statute or contract, such award
           ~ill be limited to $2,500.00.

9.   Administrative Proceedings

     A. This Program shall apply to a Dispute pending before
        any local, state or federal administrative body or court
           unless prohibited by law.

     B. Participation in any administrative or judicial
         proceeding by the Cmnpany shall not affect the
         applicability of the Program to any such Dispute upon
       . terrnination of ilie administrative or. judicial
         proceedings. A finding} recommendation or decision
         by an ad1ninistra1ive body on the merits of a Dispute
         shall have the san1e legal weight or effect under the
         Program as it would in a coutt of competent jurisdic-
         tion.
      10. Ex(                 ive Remedy

               Proceedings under the Program shall be the exclusive~
               final and binding method by which Disputes are resolved.

     11. Electing Entities

               A. Corporations or other legal entities, not otherwise
                  Parties:> 1nay elect to be bound by this Program by
                        ·written agreement with Sponsor.

              B. Election may be made only as to son1e types of
                 Disputes> or only as to som~ persons~ in the· discretion.
                       of Electing Entity .

.' ""J2.~""')~f!~£._~.:Y~"",!?a.!,~~'"'"·o-·-.·~<"'~-''''"'=o:··.,.·.""'''".~"""'""~­
              The Effective Date of this Program shall be April 15,
              2001.

    13. Severability

             The terms of this Program and the Rules are severable.
             The invalidity or unenforceability of any provision there-
             in shall not affect the application of any other provision.
             Where possible, consistent with the purposes of the
             Program, any other~rise invalid provision of the Progrrun
             or the Rules may be reformed and, as refonned., enforced.

    14. Assent

             Employment or continued employment after the Effective
             Date of this Program constitutes consent by both the
             Employee and the Cotnpany to be bound by this Program,
             both during the enlployment and after tennination of
             employment. Subn1ission of.an application~ regardless of
             form, for employment constitutes consent by both the
             Applicant and the Company to be bound by this Program.

         NABORS DISPUTE RESOLUTION RULES

   1..      Definitions

            All definitions included in the Nahors Dispute Resolution
            Program apply to these Rules.

  2.        AppJication

            A, If different rules ·are applicable to a specific class of
               Disputes, and have been adopted by Sponsor and
               served on AAA or JAMS;. these Rules shall not apply
               to such class of Disputes.
                                      B.       ~se Rules apply in the fonn existing\                   the time
                                            proceedings are initiated under the1n.

                                      C. To the extent consistent vvith these                      Rules~      the
                                            Employment Dispute Resolution Rules of AAA or
                                            JAMS also apply to all proceedings gove1:11ed. by these
                                            Rules.

                                3.    Initiation of the Process

                                      A. A Party may initiate proceedings under these Rules at
                                         any time, subject to any defenses including those
                                         applicable to the timeliness of the claim~ inclurung
                                         lin1itations and laches.

,~,.--·v····~···-., .....   ·    ··--·'B·:---·:P<.::-Party·:nray~it.d:timt1··proeeedil'1gs·by·-serving--a·w,x.iiten

                                           requ~st to initiate proceedings on AAAor J A~~fS, and
                                           tendering the appr0priate ad1ninistrative fee.

                                     C. Copies of the request shall be served on all other
                                           Parties to the Dispute by AAAor JAMS. The request
                                           shall describe the nature of the Dispute~ the amount
                                           involved; if any, the remedy sought, aud the proceeding
                                           locale requested.

                                     D. Proceeding~ may also be initiated by an E1nployee or
                                        Applicant by serving a 'Written request to initiate pro-
                                           ceedings on the Company$s Dispute Resolution
                                           Program Administrator. In such a case, the Company
                                           shall promptly fcnward any properly served request it
                                           has received to AAA or JAMS.

                                     E. Parties against whom a claim is asserted shall file an
                                        answering staten1ent within 21 days of receiving
                                        notice of intent to arbitrate or a specification of
                                        claims, which shall include any counterclaims and
                                        any request that the arbitrator (if any) prepare a state~
                                        ment of reasons for the award.

                                4.   Administrative Conference

                                     AAA or JA..1v!S shall convene an administrative conference
                                     as soon as possible after receipt of the ansv{etip:g state... ·
                                     1nent or after expiration of the time for filing an answering
                                     statement if one. has not been filed. The conference may
                                     be held in person or by telephone. At the conference,
                                     AAA or JAMB \¥ill determine whether the Parties are in
                                     agree1nent on a 1nethod to resolve the Dispute. If the
                                     P~rties are in agreement, AAA or JAMS vvill implement
                                     the procedure in accordance with their rules upon payment
                                     of any applicable fee. If the Parties cannot agree, or if the
                           Pan    have previously attempted and failed 1 esolve the
                           Dispute by mediation or another nonbinding mec.hanism,
                           the Dispute shall be arbitrated under these Rules.

                    5.    Appointment of Arbitrator

                            Imn1ediately after payment of the arbitration fee, AAA or
                            JAMS shall sin1ultaneously send. each Party an identical
                            list of names of persons chosen from a panel of qualified
                            arbitrators which AAAor JAMS shall select and maintain.
                            Each Party to the Dispute shalt have fourteen ( 14) days
                           from the transmittal date to strike any names objected to_,
                         · number the remaining names in order of preference, and
                           return the list to AAAor JAMS. If a Party does not.tetu.rn
                           the Hst \Vithin the time specified~ all persons therein shall
                           he ·deemed:""acceptabl~·From· ..·among-the·-persons··who-·"""·'--:-.---------·------·<--·-·- -•~ -=·. ··
                           have been approved on both lists, and in accordance with
                           the order of mutual preference, AAAor JAMS shall invite
                           the acceptance of the arbitrator or arbitrators to serve. In
                           those cases where more thari $2,.000~000 is in controversy,
                           either Party shall have the right to require that the
                           arbitration proceed before a three member panel rather
                           than a single arbitrator. The Party who elects for a panel
                          in these circumstances shaH notify the other Parties during
                          the administrative. conference described in Section 4 of
                          the Progrrun. Any Party shall have the right to strike one
                          list of arbi~ators in it's entirety. when a Party exercises
                         this· right) AAA or JAMS shall issue a new list of
-~;;.-·,·-
   ~:,:::'-
             ,.,         arbitrators consistent with the above procedures.

                   6.    Qualifications of the Arbitrator

                         No person shaH serve as an arbitrator in any matter in
                         w1Jich that person has any financial or personal interest.
                         Prior to accepting appointment~ the prospective arbitrator
                         shall disclose any circumstance likely to prevent a prompt
                         heating or create a presumption of bias. Upon receipt of
                         such information from the arbitrator or any other source,
                         AAA or JAMS V\:ill either replace that person or
                         communicate the information to the Parties for comment.
                         Thereafter, AAAor JAMS may disqualify that person, and
                         its decision shall be conclusive.

                   7.    Vacancies

                         If a vacancy occurs f<;Jr any reason or if an appointed
                         arbitrator is unable to serve promptly) the appointn1ent
                         procedure in Section 5 shall apply to the selection of a
                         substitute arbitrator.
8,    Da.t     Time and Place of Hearings

      A. The arbitrator shall set the dates tune and place of any
         proceeding pursuant to the requirements of Section
         8B of the Program.

      B. Notice of any hearing shall be given at least ten (1 0)
         days in advance, unless the arbitrator detenniries or
         the Parties agree that a shorter time is necessary.

      C. The arbitrator shall make every effort, without undu-
             ly incurring expense; to accommodate the Employee
             or Applicant il1 the selection of a proceeding.Jocation.



     At the request of AAA or JAMS; or of a Party or on the
     initiative of the arbitrator~ the arbitrator or AAA or JAMS
     may notice and hold conferences for the discussion and
     determination of any matter \vhich will expedite the
     proceeding, including:

     A. venue,

     B. clarification of issues,

     C. determination of prelin1inary issues, including sunl-
          mary determination of dispositive legal issues,

     D. discovery,

     E. the time and location of proceedings or conferences,

     F. interhn legal or equitable relief authorized by applica-
          ble law~

     G. pre- or post-hearing 1nemorand~

     H. stipulations; and/or

     I.   any other matter of substance or procedure.

10. Mode of Hearings and Conferences

     In the discretion of the arbitrator or by agreeinent of t.l-te
     Parties, conferences and hearings n1ay be conducted by
     telephone or by vvritten submission, as well as in person.
1L P:re.      a.ring Discovery

    A. On any schedule determined by the arbitrator, each
       Party shall submit in advance the names and address-
       es of the witnesses it intends to produce and any doc ..
       uments it L.itend.s to present

    B. The arbitrator shall have discretion to determine the
       form, amount and frequency of discovery by the
           Parties.

    C. Discovery may take any form pernutted by the
       F:ederal Rules· of Civil Procedure, as amended fron1
       time to time~ subject to any restrictions imposed by
       the arbitrator,

12. Representation

    Any Party may be represented by counsel or by any other
    authorized representative.

13. Attendance at Hearings

    The arbitrator shall maintain the privacy of the proceedings
    to the extent permitted by law. Any person having a direct
    interest in the matter is enthled to attend the proceedings.

   The arbitrator shall otherwise have the povver to exclude
   any witness, otl1er than a Party or other essential person}
   during the testintony of any other witness. The arbitrator
   shaH determine whether any other person may attend the
   pYoceeding. Upon the request of any Party) the arbitrator
   shall exclude any witness during the testimony of any
   other witness.

14. Postponement

   A. The arbitrator} for good cause shown by a Party} or on
      agreement of the Parties, tnay postpone any proceed-
      ing or conference.

   B. The pendency of court proceedings related to the
      srune matter is not good cause for postponeinent

15. Oaths

   Before proceeding with the first hearing, each arbitrator
   ro.ay take an oath of office and) if required by la\v~ shall do
   so. The axbitrator n1ay require witnesses to testify under
   oath ad1ninistered by any duly qualified person and~ if
   req-t.lired by la\V or requested by any Party) shall do so.
16. Rec'         l of Proceedings

        There shall be no stenographic, audio, or video record of
        the proceedings unless either requested by one of the
        Parties or specified by the arbitratot The Party requesting
        the record shall bear the entire cost of producing the same.
        Copies of the record shall be furnished to all other Parties
        upon request and upon pay1nent of the cost of reproduc-
        tion.

17. Procedure

        TI1e pl'oceedings shall be conducted by the arbitrator in
        whatever order and 1nan11er will most expeditiously
        permit full presentation of the evidence and argum.ents of
  A~-   i1teJ?atties:;

18. Arbitration in the Absence of a Party

        Th_e arbitrator may 1)roceed in the absence of Pruties or
        representatives who~ after due notice, fail to be present or
        fail to obtain a postponement. An award shall not be tnade
        solely on the default of a Party. The arbiu:ator shall
        require any Pmty who is present to submit such evidence
        as the arbitrator tnay require for the making of an award.

19. Evidence

        A. The arbitrator shall be the sole judge of the relevancy,
           m.a.teriality ~ and ad1nissibility of evidence offered.
           Confonttity to legal rules of evidence shall not be
           necessary.

        B. The arbitrator n1ay subpoena \\itnesses or docum.ents
           at the request of a Party or on the arbitrator»s own
           initiative.,

        C. The arbitrator n1ay consider the evidence of witnesses.
           by affidavit or declaration, but shall give jt only such
           weight as the arbitrator deems appropriate after con-
           sideration of any objection made to its admission.

20. Post. .Hearing Submissions

        All docmnentary evidence to be conf:.idered by the arbitrator
        shall be filed a.t the hearing unless the arbitrator finds good
    cause to pennit a post-hearing subn1ission. All Pmties
    shall be afforded an opportunity to exatnine and comment
    on any post-hearing evidence, The arbitrator shaH pern1h
    the filing of post~ hearing brief.<; at the re.quest of a Patty
    and shall detemline the procedure ai1d timing of such filings.
· 21. Ck         g and Reopening of Proceedings

       A. \Vhen the arbitrator is satisfied that the record is
          completeJ including the submission of any post-hearing
          briefs or documents permitted by the arbitrator,. the
          arbitrator shall declare the proceeding closed.

       B. The proceeding may be reopened on the arbitrator,s
          initiative or upon application of a Party at any tune
          before the award is made.

22. Waiver of Procedures

        Any Party who fails to object in \vtiting~ after knowledge
        that any provision or requirements of these procedures and
,,, --·"<Rules4Ja'Y¢:·-·.~ot--b~en,..c.omplie4 Wiillt-~shrulJ)e,-deem1.1<l:to ,...;;_'"·'l"·~'~""~"'""''"''"   "''"""' "'"·"'"·;
        have waived the right to object.

23. Service of Notices and Papers

      Any papers, notices, or process necessary or proper for the
      initiation or continuation of any proceeding under these
      Rules (including the award of the arbitrator; any court
      action in connection there-with, or the entry of judgment
      on an award made under these procedures) n1ay be served
      on a Party by mail addressed to the Party or his or her
      representative at the last knqwn address or by personal
      service. AAA, JAMS, t."t.e Parties., and the arbitrator may
      also use facsimile transtnission, telex, telegram, or other
      vvritten forms of electronic communication to give any
      notices required by these Rules.

24. Communications with the AAA, JA1\1S, and the
Company

     A. Any Party may notice, serve or communicate with
        AAAby contacting:

                        Regional Administrator
                        American Arbitration Association
                        1001 Fannin St.) Suite 1005
                        Houston, Texas 77002
                        (713) 739-1302
                        Fax: (713) 739-1702

     B. Any Party may notice, serve or communicate with
        JM1S by contacting:

                        JAMS
                        345 Park Avenue!> &th Floor
                        New York, NY 10154
                        (212) 751~2700
                        Fax: (212) 751-4099
              C.     .y notice, service or c.ommunicati(                      with the
                   Company vvill be to:

                               Legal Department
                               Nabors Industries, Inc.
                               515 West Greens Road~ Suite 1200
                               Houston, Texas 77067-4525
                               (281) 874~0035
                               Fax: (281) 775-8431

       25. Communication with the Arbitrator

                         There shall be no communication between the Parties and
                         the arbitrator other than at any oral hearings or confer-
                         ences. Any other oral or written communications from the
..,. ~--···. --- . ,. __ parties .tO-the~arbitrator . shall. be.directed, to.the_.AAA ..or-
             JAMS (and copied to the Parties) for transmission to the
             arbitrator, unless the Parties and the arbitrator agree other-
             'vise.

       26. Time of Award

             The award shall be promptly made by the arbitrator,
             unless otherwise agreed by the Parties or specified by
             applicable Jaw~ no later than thirty (30) days from the date
             of the closing of the proceeding or) if applicable, the
             closing of a reopened proceeding.

       21. Form of Award

             The award shall be in ¥rrriting a..t1d shall be signed by the
             arbitrator. The arbitrator shall write a staten1ent of reasons
             for the award if requested to do so in the request to
            ,initiate proceedings or in the answering statement. The
            award shall be executed in any manner required by appli-
            cable law.

      28. Modification of A'vard

            On order of a court of competent jurisdiction, or on agree. .
            1nent of the Parties~ the arbitrator shall n1odify any a·ward.
            The arbitrator tnay modify an award on the n1otion of a
            Party if the arbitrator finds that the award, as rendered~ is
            ambiguous or defective in form> or if the award requires
            an. illegal or hnpossible act . These are the only circun).-
            stances under which an arbitrator shall have jurisdiction to
            withdraw or modify an award.
                                                        29. Set      nent

                                                             If the Parties settle their Dispute during the course of the
                                                             arbitration, the arbitrator may set out the terms of the
                                                             settlement in a consent award.

                                                       30. Scope of Arbitrator's Authority

                                                                  The arbitrator ~s authority shall be limited to the resolution
                                                                  of legal Disputes between the Parties. As such, the
                                                                  arbitrator shall be bound by and shall apply applicable law~
                                                                  including that related to the allocation of the burden of
                                                                  proof; as weH as substantive law. The arbitrator shall not
                                                                  have the authority either fo abridge ot enlarge substantive
                                                                .·rights available under applicable law. The arbitrator 1nay
;.'" . ';"'.:· .• _.:....: ____________ "'----~'.;   ·· ·.· _;,:.,.alscr·grant ·elnergency-or-tetnpofary·reliefthatis·or·would:
                                                            be authorized by applicable law. The arbitrator shall be
                                                            bound by and shall comply with the provisions of the
                                                            Progrrun and Rules.

                                                       31. Judicial Proceedings and Exclusion of Liability

                                                            A. Neither AAA, JAMS> nor any arbitrator is a necessary
                                                               Party in any judicial proceedings relating to proceed-
                                                               ings under these Rules~

                                                            B. Neither AAA, JAl\1S, nor any arbitrator shall be liable
                                                               to any Party for any aqt or omiss1on in connection
                                                               with any proceedings within. the scope of these Rules.

                                                            C. Any court with Jurisdiction over the Parties may
                                                               compel a Party to proceed under these Rules at any
                                                               place and may enforce any award made.

                                                            D. Parties to these Rules shall be deemed to have
                                                               consented that judgment upon ihe award of the
                                                               arbitrator may be entered and enforced in any federal
                                                               or state court having jurisdiction of the Parties.

                                                           E. Initiation of: participation in, or removal of a legal
                                                              proceeding shaH not constitute waiver of the right to
                                                              proceed under these Rules.

                                                           F.   Any court with jurisdiction over the Parties n1ay issue
                                                                any injunctive . orders{including prelin1inary injunc-
                                                                tions) if the necessary legal and equitable require-
                                                                ments under applicable law are met~ pending the
                                                                institution of proceedings under these Rules.
 32. Fee    td Expenses

     A. The expenses of witnesses shall be borne by the Party
        producing such vv-itnesses} except as otherwise
        provided by law or in the award of the arbitrator.

     B. A.ll attmneys' fees shall be borne by tl1e Pa1.ty
        inculTing them except as otherwise provided by Jaw~
        by the Program~ or in the award of the arbitrator.

    C. Discovery costs (e.g.) court reporter fees for original
       transcripts) shall be borne by the Party initiating the
       · discovery. The cost of copies of deposition transcripts
         or other discovery shall be borne by the Party ordering
         the copy.

    D. The fees and expenses of experts~ consultants and othM
       ers retained or consulted by a Party shall be borne by
       the Party utilizing those services.

    E. The Etnployee or Applicant shall pay a $150 fee if he
       or she initiates arbitration or 111e.diation. Othervvise,
       Etnployee/Applicant Patiies shall not be responsible
       for payment of fees and expenses of proceedings
       under the.se Rules~ including requi1·ed travel of an
       arbitrator or a mediator) expenses of an arbitrator)
       1nediator~ AAA or JAMS, and the cost of any proof
        produced at the discretion of an arbitrator.

    F. If the dem.and for tnediation or arbitration is initiated
       by the Con1pany, such fees wiH be paid by the.
       Con1pany.

    G. Except as otherwise. provided by law or in the a\Vard
       of the arbitrator, all otbet· expenses~ fees and costs of
       proceedings under these Rules shall be borne equally
       by the Parties who arc not E1nployees/Applicants.

33. Interpretation and Application of These Rules

    The arhin~ator shall interpret and apply these Rules insofar
    as they relate to the arbitrator~s powers and duties. All
    othef rules shall be in interpreted and applied by the AAA ·
    or JAMS.

34. Applicable Law

   .A. Proceedings under these Rules and any judicial
       reviev-,t of aV~rards shall be govetT.Jed by the Act
   B~ J      cept where otherwise expressly provi ! in these
          Kules, the substantive law applied shall be state or
          federal substantive law which would be applied by a
          United States District Court sitting at the place of the
          proceeding.

35. Mediation

   At any time before the proceeding is closed~ the Parties
   may agree to mediate their dispute by notifying AAA or
   JAMS. AAA or JAMS shall dctennbte what procedures
   apply to any such mediation.

36. Spanish
Nabors Industries! Inc.
      AprH 2001
  January 17, 2007
  TO:     All Employees of Nabors Industries, Inc. and Subsidiaries ·

  RE: · Nabors Dispute Resolution Program

  Dear Employee:

  Effective ten (1 0} days after the date of this~ notice~ pursmmt to Section 6 of the Nabors Dispute
  Resolution Pro~ Nabors Industries; Inc~ e(Nabors,} and its subsidiaries are amending the
  Nabors' Dispu~e Resolution .Progt:am ~if Rules for the determination of all disputes between
  employees ~d Nabors or on~ ·of ~ts :sub~idi~e~k                ,           ·
  Th~-;;n;p_~;nts ~-th~ P;~~~ and Rul~ ate 009fosed on the b~~k.of,ilifs·;:~~.                                Nabors is
 amending ·one (lJ' seCtion of the Nabors· Dispute Resolution Program and one (1) section of the
 Nabors Dispute Resolution Rules. You. should already have a copy of the current Program and
 Ru1es~ or they may be found on the Nabors Intranet under policy number 200.80.1 at
 )tf :'·     · · ; t.nabo        10/Hil.       ··        .t:lefaufi:.                                 +




   As before, tlie Nabors Dispute Resolution Pro~ as amended, gives you .the most effective
  <and efficient means of-resolving any disputes you may have through a process which encourages
  resolution at the earliest opportunity. Employees do not waive any substantive legal rights under
  the Program,. Rather:~ the Prop, as amended, proVides that any subst.antive legal issues you
  may have will be r¢wlv~ on' an individ~al basis in mediation or bef~re a neutral arbitrator,
  whose decision will be final and binding on you and the Company. Under the Program, as
   amended, however! .you waive any procedural rights you may have to bring a court action, on an
  individual or on.~,dass~ coU~ive or representatiVe basis; and you waive your right to a jury trial
  concerning any qispute you may have with the Company or any Electing Entity (as defined in the
, Program), including any p~onal injury claims or claims of discrimination based on race~
  national origins gender~ religion, age or disability under any federal or state civil rights statute.

 Eveiy individual who works for Nabors Industries~ Inc. or a subsidiary is subject to the Progra~
 as am.ended, except that the amended provisions wi_ll affect only disputes initiated after the
 effective date of the amen(l.~ts; and not any matters pending before the effective date.. Your
 con~ued employment after the date you receive this notice will constitute your acceptance of
 the amendments to the Program1 both during and after your employment with the Company.

 We look forward to oontinuing to work together. If you have any questions about the
·amendments to the Pro grain and Rules or any other terin of your employmcn,t, please do not
 hesitate to contact the Human Resources Department of yottr employer.                                    ,

 SincerelyJ

 NABORS INDUSTRlES, INC.


                           *A ctJjJ)foftlt11 notlc:i: ,.tilva/lo(Jie in Spanis~ upon request,
                         from ¥Uzy N.it!JtttJ; srth.~ldlttrjtfs!imnan Resources ~anment.

                   * Una oopia de esta itoticia esta dispcniblc en ttSpa.ff.ol con sol() requerirla
                  al Deparfflhtettf(J de Rccursosllutnanos tie cualquier l{Uhsidillria de Nabqrs.
4. Resolution of Disputes

    A. All Disputes not otherwise se~ed by the Parties shall be finally and conclusively resolved under
       this Program and the Rules. The Parties forego any right either may have to a jury trial on claims
       relating in any way to any Dispute.

    B. Each Dispute shall be arbitrated on an individual basis. The Parties forego and waive any right to
       join 9r consolidate claims in arbitration with others or to make claims in arbitration as a
       .represeu:tative or as a member of. a class or in a priva~ attorney general or similar capacity) unless
       such ·procedures ate agreed· to by all Part~es·. N~ither th~ Company nor any Employee or
       Applicant may pursue any Dispute on a class action, collective action or consolidated basis or in a
       repre,S<:mtative. ca.P.acity ()11_ ~palf. of oth~r pers~ns or Mtitles w~o are .claime4 to be similarly
    ·'·""··""·~~~~·.·ofvfliticipalea~icla~s"'ntem~er-:iit~~tnrprooee1iing;:·1lletatb1tt.aiOrm\~:prer~fug~···"~··~·"
        Un.der this ·Ptogrilln shall have no authority to conduct      the matter as a consqlidaied, class~
        collective or representative action.

    C. If the procedural limitation in Panigtaph ~ of this .Section is held unenforceable by a coittt m a
         proceeding in which a party seeks to pursue a consolidated, class or coflective action or other-wise
         act in a representativ~ capacity, then this Program shall apply to such prQCeed~g only to the
       . following extent The court will decide whether the Dispute should pro~ on a consolidated,
         class! collective or other representative basis and, if so~ will 4e:fine the scope of the class. None
         of the foregoing rl,etenuin~tions shall be submitted to the arbitrator3 and in no event shall the
        3;1'hitrator have the power to determine class, collective or representative action certification. The
      . court~s decisions will be subject to appeal pursuant to the applicable rules of procedure. If the
         court certifies a class, collective or other representative actio~ then all other determinations in or
        related to the' Dispute shall be made by the arbitrator. The arbitrator shall determine questions of
        liability to or 'of the class as a whole and remedies available to or from the class as a whole. The
        arbitnrtor shall also decide the relie~ if any, to which a party or class member may be entitled
        individually. If the court, however~ ultimately denies a party's request to proceed qn a
        consolidat~~ c1ass5 collective or representative basis, then that party's individual claim(s) shall
        still be subject to this Program and referable to arbitration pursuant to its teons,


                 A;:mendinent. ttl NABORSDISP.lJTE RESOLUTION RULES:

30. Scope of Arbitrator's Authority

   A. The arbitrator~ s autho#ty shall be limited to the resolution of legal Disputes between the Parties.
      As such, the arbitrator shall be bound by and shall apply applicable law" including that related to
      the allocation of the burden of proof, as well as substantive law. The arbitrator shall not have the
      authority either to abridge or enlarge substantive rights available under applicable law. The
      arbitrator may also grant emergency or temporary relief that is or would be authorized by
      applicable law. The arbitrator shall be bound by and shall comply with the provisions of the
       Program and Rules.
   B. The arbitrator shall not have the power to hear any claims in arbitration as a class or collective
      action, or in a private attorney general or similar capacity1 or on any other representadve capacity
      basis* or~ absent tbe consent of all parties, on a consolidated basis. The arbitrator shall be
      authorized to decide only the disputed claims betwe.en the individual pa.rties,
 PROGRAMA DE RESOLUCION DE
   CONFLICTOS DE NABORS




Copies of this pan~phlet are available in Spanish, upon
   request, from any Nabors subsidiary's Human
                 Resources Department.

Copias de este folleto estan disponible en espana! con
   solo requerirlas al Departamento de Recursos
          lfumanos de cualquz-ersubs 4 -art de Nabors
                                    1 1
~ROGRAMA DE RESOLUCION DE CONFLICTOS DE
~ABORS


l.    1. Proposito y Disefio

      El Programa esta disefiado con el fin de proporcionar un
     medio para Ia resoluci6n rapida, justa, accesible y
     econ6mica de conflictos entre Ia Compafiia y los Empleados
     actuales y anteriores de la Compafifa y los Aspirantes para
     puestos de empleo, con respecto a o como consecuencia de
     una relaci6n de empJeo actual~ anterior o potencial con la
     CompafHa. El Programa esta disefiado para facilitar un
     proceso para la resoluci6n definitiva de todas los Conflictos
     descriptos en los terminos del mismo. No esta disefiada para
     limitar o aumentar los derechos fundamentales disponibles
     bajo las leyes aplicables. El Programa modifica en forma
     contractual la relaci6n de empleo efectuado entre 1a
     Compafiia y sus Empleados, pero s6lo en la medid~ en que
     este expresamente establecido en el Programa. El Programa
     debeni ser interpretado de acuerdo con esta intenci6n.


Z.    Definiciones

      A. "AAA" significara la Asociaci6n Americana de
         Arbitraje (the American Arbritration Association).

      B.    JAMS 11 significara los Servicios de Mediaci6n y
           11


           Arbitraje Judiciales (Judicial Arbitration and
           Mediation Services)

      C.   La "Ley 11 significara la Ley Federal de Arbitraje (the
           Federal Arbitration Act)

      D. La "Compafi.ia" significara el patrocinador del
         Programa y las filiales directas o indirectas (ya sean una
         corporaci6n 1 una compafiia de responsabilidad limitada,
         una sociedad u otra entidad legal) del patrocinador, la
         Entidad que Selecciona el Programa, la entidad o
         persona que se alega tiene responsabilidad asociada o
         separada con respecto a cualquier Conf1icto, y todos sus
         directores, funcionarios, empleados y agentes, plan de
         beneficios, ya sea exento o no-exento de impuestos,
         establecido o mantenido por dicha entidad, los
         fiduciarios, agentes y empleados de dichos planes, y los
         sucesores y beneficiarios de dichas entidades, planes y
         personas; siempre y cuando, en el caso de la Entidad
         que selecciona el Programa, 11 La Compaf'ifa 11 debeni
         incluir la Entidad que Selecciona el Programa
         solamente en la medida establecida en el contrato de
         dicha Entidad en la que estani ob1igada por el
         Programa.
E. uconflicto" significara todas las demandas legales y
   justas, los reclamos y controversias, de cualquier indole
   o tipo, ya fueren contractuaJes, o de responsabilidad
   extracontractual, de acuerdo con el derecho escrito o las
   regulaciones o a1guna otra ley, entre las partes
   ob1igadas por el Programa o por un contrato para
   resolver los Conflictos de acuerdo al Programa, o entre
   una persona obHgada por el Programa y una persona o
   entidad con derecho a recibir sus beneficios, incluyendo
   pero sin limitarse a lo siguiente:

   1.       este Programa;

   2.       la contrataci6n o Ia posibJe recontrataci6n de un
            Empleado, incluyendo los terminos, condiciones o
            el cese de dicho empleo con Ia Compafifa;

   3..      los beneficios o incidentes de empleo con la
            Compafifa;

   4.     todo asunto relacionado con la relaci6n entre el
         Empleado y la Compafifa incluyendo, por ejemplo
         pero sin limitarse a: la discriminaci6n basada en Ja
         raza, el sexo, la religion, el origen nacional, la
         edad, la condici6n de veterano de guerra o
         cualquier incapacidad; el acuso sexual u cualquier
         otro tipo de acoso; las represalias por concepto de
         compensaci6n laboral; la difamaci6n, la imposici6n
         de un agravio emocional, la reclamad6n de
         antirnonopolio relacionado con sueldos o el estado
         de) una rec1amaci6n por o una membresia
         relacionado con los planes de beneficios para
         empleados;


   5~       la solicitud de un Aspirante para un puesto de
            empleo y las acciones y decisiones de Ia
            Cornpafiia con respecto a dicha solicitud; y

   6.     cualquier Jesi6n personal supuestamente incurrida
         en o alrededor del sitio de trabajo de una Compaftfa
         o durante el termino y alcance de las actividades
         Jaborales de un Empleado,

   El 11 Conflicto" incluye todo lo anteriormente men-
   cionado, independientemente del momenta en que
   hayan ocurrido los eventos en los cuales esten basados,
   incluyendo los asuntos basados en eventos que hayan
   sucedido antes de que el Ernpleado estuviera sujeto a
   este Programa (siempre y cuando dichos conflictos no
   fueren establecidos con anterioridad en un tribunal
   juridico) o despues de la terminaci6n de Ia relacion de
   emp!eo
   F. La "Entidad que Selecciona el Programa" significara
      toda entidad legal que hubiera acordado una obligaci6n
      por medio el Programa de acuerdo a las disposiciones
      de este documento.

   G. El' 1Empleado 11 signifkara toda persona que estuviera o
      hubiera sido empleada por Ia Compaftia a la fecha o
      despues de la fecha de vigencia de este Programa,
      incluso si estuviera o no estuviera empleado por la
      Compafifa en el memento en que una demanda fuera
      presentada en relaci6n con un Conflicto, y que residiera
      en los Estados Unidos de America, o que estuviera
      sujeto a las leyes de los Estados Unidos o de cualquier
      estado, municipalidad u otra subdivision polltica de los
      Estados Unidos.

   H. El 11 Aspirante 11 significara toda persona que estuviera
      buscando o que haya buscado empleo con la Compafifa
      despues de la fecha de vigencia de este Programa.

   I. Las 11 Partes" significaran, las personas perjudicadas en
       relaci6n con un Conflicto particular, y/o las entidades
       que obligadas y vincu1adas por este Programa.

   J. El uPrograma" significara este Programa de Resoluci6n
       de Conflictos de Nabors, y como fuere modificado de
       tiempo en tiempo.

   K. Las 11 Reglas" significaran las Reglas para la Resoluci6n
      de Conflictos de Nabors, segun fueran modificadas de
      tiempo en tiempo, que sean aplicables ala mediaci6n y
      el arbitraje.

   L. El "Patrocinador11 significan1 Nabors Industries, Inc.,
       una corporaci6n del estado de Delaware.

3. Nombre, Aplicaci6n y Cobertura

   A. El Prograrna sera denominado el uPrograma de
      Resoluci6n de Contlictos de Naborsn. De forma a1ter-
      nativa, podra ser referido como el "Programa de
      Resoluci6n de Conflictos".

   B. Hasta que sea revocado por la entidad Patrocinadora de
      acuerdo con lo dispuesto en este Programa, dicho
      Programa se aplica y obliga la Compaftia, cada
      Empleado y cada Aspirante y sus herederos, los bene-
      ficiaries y los cesionarios de dicha persona o entidad;
      siempre que este Programa no se aplique a un
      Empleado que sea parte de un grupo de Empleados
      representados por una organizaci6n !aboral o ala
      Compafifa relacionada con dichos empleados, excepto
          en la medida permitida en un convenio de negociaci6n
          colectiva (entre patronos y sindicatos obreros) o
          legalmente impuesto por la Compafiia cuando ningun
          convenio de negociaci6n colectiva estuviera vigente.

     C.   Este Programa se ap] ica a todo Conflicto, salvo se
          estipu1e lo contrario en este documento.

     D. Sin peijuicio de lo estipulado en este Programa, e]
          mismo no se aplica a las rec1amaciones por concepto de
          indemnizaci6n o compensaci6n de beneficios para
          obreros ode beneficios por concepto de desempleo.

     E. La mediaci6n y el arbitraje estim solamente disponibles
          para los Conflictos que involucren derechos que
          estuvieren protegidos legalmente.

     F.    Sin perjuicio de otras disposiciones establecidas en
          este documento, todo tribunal con jurisdicci6n sobre las
          Partes puede emitir 6rdenes judiciales (incluyendo
          requerimientos judiciales preliminares) si los requer-
          imientos legales y equitativos de acuerdo a las leyes
          aplicables se cumplieran durante la instituci6n de las
          demandas bajo el Programa. Adicionalmente, una
          demanda bajo la Ley denominada The Limitation of
          Ship Owners Liability Act, 46 U.S.S §§181-189, no
          estani sujeta a este Programa.

4.   Resoluci6n de Conflictos

     Los conflictos que no fueren resueltos por las Partes senin
     definitivamente resueltos de acuerdo con este Programa y
     sus Reglas.

5.   Articulo referente a Represalias

     No se podni imponer ninguna forma de disciplina, ni se
     debeni tomar represalias con los emp1eados por haber ini·
     ciado o participado de buena fe en un proceso o una
     demanda de acuerdo con este Programa.

6.   Enmienda

     A. Este Programa puede ser modificado por e1 Patrocinador
        en cualquier momento mediante una notificaci6n previa
        a los empleados actuales de por lo menos 10 dfas. Sin
        embargo, no se debeni aplicar ninguna enmienda a un
        Conflicto por el cual una demanda haya sido iniciada de
        acuerdo con las Reglas salvo se convenga lo contrario
     B. El Patrocinador puede modificar las Reglas en cualquier
         momento por medio de la notificaci6n de las enmiendas
         en AAAy JAMS. Sin embargo, ninguna enmienda de
         las Reglas debera aplicar a un Conflicto por el cual una
         demanda haya sido iniciada de acuerdo con las Reglas,
         salvo se acuerde Jo contrario.

7.   Terminacion del Programa

     Este Programa podni ser terminado por el Patrocinador en
     cualquier momenta mediante Ia notificaci6n a los
     Empleados actuales en un plazo no mayor de 10 dias previa
     a la terminaci6n antedicha. Sin embargo, la terminaci6n no
     entrani en vigencia para los Conflictos para los cuales una
     demanda haya sido iniciada de acuerdo con las Reglas antes
     de la fecha de terminaci6n, salvo se acuerde lo contrario.

g_   Ley Aplicable

     A. La Ley se aplicara a este Programa, las Reglas y
        cualquier demanda realizada de acuerdo al Programa o
        las Reglas) incluyendo las demandas para obligar, hacer
        cumplir, anular o confirmar demandas, adjudicaciones,
        6rdenes de un arbitro, o resoluciones de acuerdo al
        Programa o las Reglas.

     B. Todos los arbitrajes efectuados de acuerdo con este
        Programa deberan ser convocados tan cerca como fuera
        posible del sitio de trabajo donde sucedieron los eventos
        en disputa, en caso que Nabors continue realizando
        labores en esa ubicaci6n. De lo contrario, el arbitraje
        tomara lugar en el sitio mas conveniente para la mayor
        parte de los testigos.

     C. Salvo se establezca de manera expresa en las Reglas
        contenidas en este documento~ se conservan los dere-
        chos legales fundamentales, los recursos y los mecan-
        ismos de defensa de todas la Partes. En caso de arbi-
        traje, el arbitro tendra la autoridad para determinar las
        leyes aplicables y de ordenar las compensaciones
        legales o equitativas, que una Parte pudiera obtener de
        un tribunal de jurisdicci6n competente en base a las
        reclamaciones presentadas en la demanda.

      D. Salvo se estipule de forma expresa en este documento, o
         en las Reglas del mismo, no se debenl. interpretar e1
         Programa con el prop6sito de otorgar derechos, recursos
         o mecanismos de defensa fundamentaies, legales o
         contractuales adicionales. los cuales no podrfan ser
         aplicados por un tribunal de una juris die-
            cion competente en ausencia del Programa.

      E. Sin perjuicio de las disposiciones establecidas en la
         subclausula anterior, en toda demanda presentada ante
         un arbitro, el arbitro, a su total discreci6n, podra per-
         mitir que un Empleado o Aspirante prevaleciente reciba
         los honorarios para el pago de abogados como parte deJ
         fallo dictado. La discreci6n para permitir la concesi6n
         de una asignaci6n de honorarios de acuerdo a esta
         subchiusula sera adiciona1 a toda discreci6n, derecho 0
         autoridad que el arbitro pudiera tener de acuerdo a las
         leyes aplicables. Si el arbitro concede los honorarios de
         abogado sin la autorizaci6n para dicha asignaci6n por
         derecho escrito o contrato, dicha asignaci6n estanl
         limitada a $2,500.00.

~.   Procesos Administrativos

     A: Este Programa se debera aplicar a un Conflicto que
        estuviera pendiente ante toda entidad administrativa o
        tribunal 1ocal, estatal o federal, a menos que estuviera
        prohibido por la ley.

     B.   La participaci6n en todo proceso administrative o
          judicial por la Compafiia no debeni afectar la aplica-
          bilidad del Programa a dicho Conflicto una vez que
          fuere terminado el proceso admjnistrativo o judiciaL Un
          fallo, una recomendaci6n o una decision efectuada por
          una entidad administrativa en base a los meritos de un
          Conflicto debera tener el mismo peso o efecto legal de
          acuerdo al Programa como si hubieran sido dictados por
          un tribunal de una jurisdicci6n competente.

10. Recurso Exclusivo

      Los procesos efectuados de acuerdo a1 Programa deberan
      ser el metoda exclusive, inapelable y vinculante por medio
      de 1os cuales se resolveran los Conflictos.

11. Las Entidades que Seleccionen el Programa

      A. Las Corporaciones u otras entidades legales, que no
         fuesen Partes del mismo, tienen la opci6n de decidir si
         quisieren estar vinculadas y obligadas por este
         Programa mediante un contrato escrito con el
         Patrocinador.

       B. Dicha opci6n para participar en este Programa puede
          ser efectuada en relaci6n con algunos tipos de
          Conflictos, o en relaci6n con algunas personas, a dis-
          creci6n de Ia Entidad que Seleccione el Programa.
 2. La Fecha de Vigencia

     La Fecha de Vigencia de este Programa sera e115 de abril de
     2001.

l3. Atribucion de Separaci6n

     Los terminos de este Programa y las Reglas son separables.
     La falta de validez o de la obligaci6n para que se
     cump1ieran algunas de las disposiciones en este documento
     no afectara la aplicaci6n de las otras disposiciones. Donde
     fuere posible, y en forma consistente con los prop6sitos de]
     Programa, toda disposici6n que fuera invalidada en el
     Programa o en las Reglas se podni modificar y despues de
     modificada, se podra obligar su cumplimiento.

14. Asentimiento

     El empleo o Ia continuaci6n del empleo despues de la
     Fecha en Vigencia de este Programa constituyen el con-
     sentimiento por parte del Empleado y la Compafifa para
     estar obligados por las disposiciones de este Programa,
     durante la duraci6n del empleo y despues de] cese de]
     mismo. La presentaci6n de una solicitud de empleo, inde-
     pendientemente del formulario utilizado, constituye el
     consentimiento por parte del Aspirante y la Compafifa para
     estar obligados por las disposiciones de este Programa.

         REGLAS PARALA RESOLUCION
          DE CONFLICTOS DE NABORS

l.   Definiciones

     Todas las definiciones incluidas en el Programa de
     Resoluci6n de Conflictos de Nabors se aplicanin a estas
     Reglas.

2.   Apticacion

     A. Si hubieran reglas diferentes que fueran aplicables a una
        determinada clase especifica de Conflicto~ y estas
        hubieran sido adoptadas por el Patrocinador y notifi-
        cadas a AAA y JAMS, estas Reglas no se aplicanin a
        dicha clase de Conflictos.

     B. Estas Reglas se aplican de la forma en que existieran en
         el momenta en que se iniciaran los procesos
         establecidos de acuerdo con las mismas.


          A.        En la medida que fuera consistente con estas
         las Reglas de Resoluci6n de Conflictos Laborales de
         AAAo JAMS tambien se aplicar{m a todos los procesos
         reglamentados por estas Reg las.

I.   El Inicio del Proceso

     A. Una Parte puede iniciar ]a demanda de acuerdo con lo
        establecido por estas Reglas en cualquier momento,
        sujeto a los mecanismos de defensa e incluyendo
        aquellos que apliquen en el tiempo oportuno de Ia
        reclamaci6n, incluyendo las limitaciones y demoras
        indebidas.

     B. Una Parte puede iniciar la demanda mediante la entrega
        de una solicitud escrita para iniciar la demanda en
        AAAo JAMS y despues del pago de cargo adminis-
        trative correspondiente.

     C. Las copias de Ia solicitud debenin ser entregadas a todas
        las otras Partes del Conflicto por AAAo JAMS. La
        solicitud debera describir Ia indole del Conflicto, el
        manto involucrado, si lo hubiese, el recurso que se
        so1icita y el sitio solicitado para el proceso.

     D. Las demandas tambh~n pueden ser iniciadas por un
        Empleado o Aspirante mediante la entrega de una
        solicitud escrita para m1ctar los procesos al
        Administrador del Programa de Resoluci6n de
        Conflictos de la Campania. En dicho caso, la Compafiia
        debera entregar en la brevedad posible a AAA o JAMS
        toda solicitud que hubiera recibido y que hubiera sido
        entregada en forma apropiada.

     E. Las Partes contra quienes se haya presentado una
        demanda debenin presentar una declaracion en
        respuesta a dicha demanda dentro del plazo de 21 dfas
        de la fecha a partir de la que se recibi6 la notificaci6n
        de la intenci6n de arbitrar o la descripci6n de las
        reclamaciones~ la cual debera incluir las contrade~
        mandas y las solicitudes para que el arbitro (si lo
        hubiera) prepare una declaraci6n fundamentando las
        razones por las cuales se concede la indemnizaci6n.

4.   Junta Administrativa

     AAA o JAMS debenin convocar una junta administrativa
     tan pronto como sea posible despues de haber recibido la
     declaraci6n de respuesta o despues del vencimiento del
     plazo para la presentaci6n de Ia declaraci6n de respuesta, si
dicha declaraci6n no hubiera sido presentada. La junta
puede ser sostenida en persona o por telefono. En Ia junta,




     A.       En la medida que fuera consistente con estas
     AAAo JAMS determinanin si las Partes han acordado un
     metodo para resolver el Conflicto. Si las Partes estuvieran
     de acuerdo, AAA o JAMS implementaran el proceso de
     acuerdo con sus reglas una vez que se haya efectuado el
     pago del cargo correspondiente. Si las Partes no pueden lie-
     gar a un acuerdo, o si las Partes hubieran intentado Hegar a
     un acuerdo y no pudieron resolver el Conflicto por medio
     de la mediaci6n u otro mecanisme que no fuera vinculante u
     obligatorio, el Conflicto debeni ser arbitrado de acuerdo
     con estas Reglas.

;.   E1 Nombramiento de un Arbitro

     Inmediatamente despues del pago del cargo por concepto
     de arbitraje, AAA o JAMS debenl.n enviar simultaneamente
     a cada Parte involucrada una lista identica de los nombres
     de las personas que fueron escogidas de un panel de arbitros
     calificados que AAA o JAMS debera seleccionar y
     mantener. Cada una de las Partes del Conflicto tendra
     catorce (l4) dfas a partir de la fecha del comunicado para
     tachar los nombres que no prefiere, numerar en orden de
     preferencia los nombres restantes y devolver la lista a AAA
     o JAMS. Si una de las Partes no regresara la lista dentro del
     plazo especificado, todas las personas en 1a misma seran
     consideradas como aceptables. Entre las personas que
     hayan sido aprobadas en ambas Iistas, y de acuerdo con el
     orden de preferencia mutua, AAAo JAMS deberan invitar a
     que uno de ellos o mas de uno ejerza/n de arbitro/s. En los
     casos en los cua]es mas de $2,000,000 este en controversia,
     cua1quiera de las partes tendra el derecho de solicitar que el
     arbitraje proceda delante de un panel de tres miembros en
     vez de un solo arbitro. La Parte que escoja un panel en
     estas circunstancias debenl. notificar a las otras Partes
     durante la junta administrativa descrita en la Clausula 4 del
     Programa. Cualquiera de las Partes tendra el derecho de
     tachar una lista de arbitros en su totalidad. Cuando una de
     las Partes ejercita este derecho) AAAo JAMS debera emitir
     una nueva 1ista de arbitros de manera consistente con los
     procesos anteriormente mencionados.


6.   Requisitos para Ia designaci6n de un Arbitro

     Ninguna persona debera ejercer como arbitro en ningun
     caso en el cual dicha persona tuviera un interes financiero o
     personal. Antes de aceptar el nombramiento, el posible
     candidate debera revelar cualquier circunstancia que posi-
     blemente pudiera impedir una audiencia oportuna o crear la
     presunci6n de parcialidad. Una vez recibida dicha infor-
     macion por parte del arbitro o de cualquier otra fuente,
     AAA o JAMS tendra que sustituir esa persona o comu-
     nicar 1a informaci6n a las Partes involucradas para que
   puedan formular sus comentarios. A partir de entonces,
   AAA o JAMS podnin descalificar dicha persona y su
   decision sera concluyente.

7. Vacantes

    Si hubiera una vacante por cualquier raz6n o si un arbitro
    designado no pudiera ejercer en forma oportuna, se debera
    aplicar el proceso para determinar nombramientos descripto
    en la Clausula 5 para la selecci6n de un arbitro substituto.

8. Fecha, Hora y Sitio para las Audiencias

    A. El arbitro debera fijar la fecha) hora y sitio de cualquier
       proceso efectuado de acuerdo con las disposiciones de
       la Clausula 8B del Programa.

    B.    Se proporcionara la notificaci6n de Ia audiencia con un
         plazo no mayor de diez (1 0) dias de anticipaci6n, salvo
         que el arbitro determinara o que las Partes convengan
         que un periodo mas corto fuera necesario.

    C. El arbitro debera realizar su labor~ sin incurrir en gas-
       tos indebidos, para acomodar el Empleado o ei
       Aspirante en la selecci6n de un sitio para el proceso.

9. Juntas

    A pedido de AAA o JAMS, o de una de las Partes o por
    iniciativa del arbitro~ el arbitro de AAA o JAMS podn1
    convocar a juntas previa notificacion para la discusi6n y la
    determinacion de cualquier asunto que agilice el proceso,
    incluyendo:

    A. Ia jurisdicci6n,

    B.    la aclaraci6n de asuntos de especial interes

    C.    la determinacion de asuntos preliminares, inc1uyendo
          el sumario de las consideraciones y disposiciones
          legales

    D. la junta previa ala audiencia

    E.    el tiempo y sitio para los procesos o juntas de arbitraje

    F.    los recursos equitativos o legales interinos autorizados
          por las leyes aplicables
    G. los memorandums anteriores o posteriores a la audi-
       encia
   H. 1as disposiciones, y/o

   I.   cualquier otro asunto o proceso fundamental

0. La modalidad para realizarAudiencias y Juntas

   A discreci6n del arbitro o por comun acuerdo entre las
   Partes, se podnin realizar juntas y audiencias por telefono o
   por escrito, asf como en persona.

l. La Junta previa a Ia Audiencia

   A. En un horario que sera determinado por el arbitro, cada
      una de las partes debera entregar por adelantado 1os
      nombres y direcciones de Jos testigos que se pro-pone
      presentar y tambien los documentos que tiene planeado
      presentar.

   B. El arbitro tendra la discreci6n para determinar el for-
       mato, la cantidad y la frecuencia de las juntas con las
       Partes involucradas.

   C. Las juntas antedichas podran tamar ei formato permi-
      tido por las Reglas Federales para Procesos Civiles, ser
      modificadas de tiempo en tiempo, y estar sujetas a las
      restricciones impuestas por e] arbitro.

2. Representaci6n

   Cualquiera de las Partes podni ser representada por un
   abogado o por cualquier otro representante autorizado .

.3. La Asistencia a las Andiencias

   El arbitro debera guardar Ia privacidad de los procesos hasta
   donde fuera permitido por la ley. Todas aquellas personas
   que tienen un interes personal en el caso a ser tratado ten-
   dran el derecho de asistir a los procesos de arbitraje.

   El arbitro debera tener la autoridad de excluir a cualquier
   testigo que no fuera una de las Partes u otra persona esen-
   cial, durante del testimonio de otros testigos. EI arbitro
   debera detenninar si alguna otra persona podra asistir al
   proceso. A pedido de cualquiera de las Partes~ el arbitro
   debera excluir cua]quier testigo durante el testimonio de
   otros testigos.
[4. Aplazamiento de los procesos o juntas de arbitraje

   A. El arbitro, debido a una causa justificada demostrada
      por una de las Partes, o de comun acuerdo con las
      Partes, podra postergar cualquier proceso o junta de
       arbitraje.

    B. La reaiizaci6n de procesos judiciales pendientes y
        relacionados con e1 mismo asunto no constituye una
        causajustificada para su aplazamiento.

l5. Declaraci6n Jurada

   Antes de proseguir con Ia primera audiencia~ cada arbitro
   podni tomar el juramenta para el ejercicio de su cargo y asi
   lo hara si fuera requerido por la ley. El arbitro puede
   requerir que los testigos testifiquen bajo juramento con-
   ducido por una persona debidamente calificada y asi lo han1
   si fuera requerido por la ley o requerido por alguna de las
   Partes.

16. Registro de los Procesos de Arbitraje

    No habra ningun registro estenogratico, de audio o video de
    los procesos de arbitraje salvo que fueran solicitados por
    alguna de las Partes o determinado por el arbitro. La Parte
    que solicite el registro debera pagar el costo total de su
    producci6n. Se suministraran copias del registro a pedido
    de las otras Partes y una vez que se haya pagado el costo de
    la reproducci6n.

17. Proceso

    El Proceso debera ser dirigido por el arbitro en el orden y
    de Ia manera que permita la mas rapida presentaci6n de la
    evidencia y de los argumentos de las Partes.

18. El Arbitraje en Ausencia de una de las Partes

    El arbitro podra proseguir en ausencia de una de las Partes o
    representantes que~ despues de la debida notificaci6n, no se
    presentaran o no obtuvieran un aplazamiento. No se
    alcanzani un fallo solamente en base a la falta de asistencia
    de una de las Partes. El arbitro debera requerir que
    cualquiera de las Partes presentes presente toda la evidencia
    que el arbitro requiriera con el fin de alcanzar un fallo o
    conceder una asignaci6n.
19. Evidencia

    A. El arbitro sera el unico que juzgara la relevancia, la
       importancia, y Ia admisibi1idad de 1a evidencia que
       fuera presentada. La conformidad con las reglas legales
       referentes a evidencia no sera necesaria.

    B. El arbjtro puede citar con una orden de comparecencia a
        testigos o documentos a pedido de una de las Partes o
        por la iniciativa propia del arbitro.

   C. EI arbitro puede considerar Ia evidencia de los testigos
      mediante una declaraci6n jurada o una declaraci6n, pero
      Je debera dar el peso que el arbitro considere apropiado
      despues de haber considerado cualquier objeci6n hecha
      para su admisi6n al proceso de arbitraje.

 20. Presentaci6n de Ia Evidencia despues de Ia Audiencia

   La evidencia documentada a ser considerada por el arbitro
   debeni ser presentada en la audiencia salvo que el arbitro
   encuentre una justificaci6n para que se permita una pre-
   sentaci6n posterior a dicha audiencia. Se les debeni propor-
   cionar a todas las Partes Ia oportunidad para examinar y
   comentar sobre cualquier evidencia que fuera presentada
   posteriormente a la audiencia. El arbitro debera permitir la
   presentaci6n de expedientes a pedido de una de las Paztes y
   debera determinar el proceso y el momento oportuno de
   dicha presentaci6n.


 21. El Cierre y la Reapertura de los Procesos de Arbitraje

    A. Cuando el arbitro este satisfecho que el registro esta
       completo, incluyendo los expedientes que hayan sido
       presentados con su permiso despues de la audiencia, el
       arbitro debera declarar el cierre del proceso.

    B. Se podra reabrir el proceso por iniciativa del arbitro o
        mediante la soHcitud de una de las Partes en cualquier
        momenta anterior al fallo del arbitro.

22. Renuncia al Derecho de Objetar en el Proceso de
    Arbitraje

    Despues de haber tenido conocimiento de que nose hubiera
    cumplido con las disposiciones o requerimientos
    relacionados con estos procesos y reglas de arbitnlje,
    cualquiera de las Partes que no se oponga por escrito sera
    considerada como que hubiera renunciado a! derecho de
    objetar.
23. Notiflcaciones

    Cualquier comunicado, notificaciones o procesos necesar-
   ios o apropiados para Ia iniciaci6n o la continuaci6n de
   cualquier proceso de arbitraje efectuado de acuerdo con
   estas Reg1as (incluyendo el fal.lo del arbitro, cualquier
   demanda judicial en relaci6n con el mismo, o la adjudi-
   caci6n de una indemnizaci6n efectuada de acuerdo con estos
   procesos) puede ser envi ado por correo dirigido a la Parte o
   su representante a la direcci6n mas reciente de la cual se
  tuviera conocimiento o entregado mediante un servicio de
  mensajeria. AAAo JAMS, las Partes, y eJ arbitro tambien
  podnl.n usar la transmisi6n por facsimile, telex, telegrama, u
  cualquier otra forma escrita de comunicaci6n electr6nica
  con el fin de entregar cualquier notificaci6n requerida por
  esta Reglas .

.4. La Comunicaci6n con AAA, JAMS y Ia Compafiia

  A.   Cualquiera de las Partes podni notificar o comunicarse
       con AAA, comunicandose con:
                Regional Administrador
                 (Administrador Regional)
                American Arbitration Association
                (Asociaci6n Americana de Arbitraje)
                1001 Fannin St. Suite 1005
                Houston, Texas 77002
                (713) 739·13022
                Fax: (713) 739-1702

  B.   Cualquiera de las Partes podra notificar o comunicarse
       con JAMS, comunicandose con:

                JAMS
                345 Park Avenue, 8th Floor
                New York, NY 10154
                (212) 751~2700
                Fax: (212) 751-4099

  C.   Cualquier notificaci6n o comunicado con la Compafifa
       debera ser dirigido a:

                 Legal Department (Departamento Legal)
                 Nabors Industries, Inc.
                 515 West Greens Road~ Suite 1200
                 Houston, Texas 77067-4525
                 (281) 874-0035
                 Fax: (281) 775-8431
~5. Comunicacion con el Arbitro

   No habra ninguna comunicaci6n con las Partes y el arbitro
   aparte de Ia comunicaci6n en las audiencias o juntas de
   arbitraje. Cualquier otra forma de comunicaci6n ya sea oral
   o escrita de las partes al arbitro deberan ser dirigidas a
   AAA o JAMS (y su copia enviada a las Partes) para ser
   transmitidas al arbitro, salvo que las Partes y el arbitro
   acuerden lo contrario.

Z6. Plazo para efectuar el FaHo de Arbitraje

   El fa1lo se efectuara rapjdamente por el arbitro, salvo que
   se hubiera acordado lo contrario por las Partes o que estu-
      viera estipulado por las leyes aplicables, en un plazo no
      mayor de treinta (30) dfas a partir de la fecha del cielTe de
      los procesos o, si fuera aplicable, del cierre de un proceso
      de arbitraje que haya sido reabierto.

~7.   El Formato del Fallo de Arbitraje

      El fallo del arbitraje debeni ser por escrito y debera ser fir-
      made por el arbitro. El arbitro debeni redactar una
      declaraci6n de las razones para el fallo, si fuera requerido
      en 1a solicitud para iniciar los procesos o en la declaraci6n de
      respuesta que se hubieran presentado. El fallo del arbi - tro
      debera ser ejecutado de la manera requerida por las !eyes
      aplicables.

!.8. Modificaciones del Fallo del Arbitro

      Como consecuencia de un mandato de un tribunal de juris-
      dicci6n competente, o por comim acuerdo entre las Partes, el
      arbitro debera modificar cualquier fallo que se hubiera
      dictado. El arbitro podni modificar un fallo mediante la
      moci6n de alguna de las Partes si el arbitro considera que el
      fallo fuera ambiguo o presentara algun defecto, o si el fallo
      requiriera un acto ilegal o imposible de realizar. Estas son
      las (micas circunstancias por medio de las cuales un arbitro
      tendra jurisdicci6n para retirar o modificar un dictamen o
      fallo.

29. Resolucion

      Si las Partes resuelven su Disputa durante el transcurso del
      arbitraje, el arbitro podra describir los terminos de la res-
      oluci6n en un fallo de consentimiento.

30. Alcance de Ia Autoridad del Arbitro

 La autoridad del arbitro debera estar limitada a la reso1uci6n de
                 Conflictos legales entre las Partes. Como ta], el
       arbitro debera estar obligado por y debera aplicar las leyes
      aplicables, incluyendo las que esten relacionadas con la
      determinacion del peso de la prueba~ asi como las !eyes
      fundamentales. El arbitro tendra la autoridad para limitar o
      extender los derechos fundamentales protegidos por las
      leyes aplicables. El arbitro podra tambien conceder un
      recurso de emergencia o provisional que este o que podria
      estar autorizado por las leyes aplicables. El arbitro debera
      estar obligado a cumplir con las disposiciones del Prograrna
      y las Reglas.

31. Los Procesos Judiciales y Ia Exclusion de
    ResponsabiUdad

      A. Ni AAA, JAMS o ningun arbitro deberan constituir
      ninguna de las Partes de ning(m proceso judicial en
      relaci6n con los procesos de arbitraje efectuados de
      acuerdo con estas Reglas.

   B. Ni AAA) JAMS o ningun arbitro sera responsab1e ante
      ninguna de las Partes por ningun acto de omisi6n en
      relaci6n con cualquier proceso que se encuentre dentro
      del alcance de estas Reglas.

   C. Cualquier tribunal con jurisdicci6n sobre las Partes
      podra obligar a alguna de las Partes a proceder de
      acuerdo con estas Reg1as en cualquier lugar y podni
      hacer cumplir cualquier fallo que se haya dictado.

   D. Se considerara que las Partes bajo estas Reglas con-
      sienten en que el fallo del arbitro podra ser admitido y
      que dicho fallo se podra hacer cumplir en cualquier
      tribuna] federal o estatal que tuviera jurisdicci6n sobre
      las Partes.

   E. La iniciaci6n de, la participaci6n en, o la eliminaci6n de
       un proceso legal no constituira una renuncia al derecho
       a pro ceder de acuerdo con estas Reglas.

   F. Cualquier tribunal con jurisdicci6n sobre las Partes
      podra presentar 6rdenes judiciales (incluyendo 6rdenes
      preliminares) si se cumplieran los requisites legales
      necesarios y equitativos de acuerdo con las leyes
      aplicables, en espera de la instituci6n de los procesos de
      arbitraje efectuados de acuerdo con estas Reglas.

;2. Honorarios y Gastos

  A. Los gastos de los testigos deben\n ser pagados por la
      Parte que presenta dichos testigos, salvo se indique lo
      contrario en las leyes aplicables o en el fallo del arbitro.
   B. Todos los honorarios de los abogados deberan ser
      pagados por la Parte que los contrat6, salvo se indique
      lo contrario en las leyes aplicables, en el Programa o en
      el fallo del arbitro.

   C. Los costos de las juntas a realizarse (por ejemplo: los
      honorarios del relator para la transcripci6n original)
      deberan ser pagados por Ia Parte que inicia 1a junta. El
      costo de las copias de la transcripci6n de Ia declaraci6n
      jurada y cualquier otro costo debera ser pagado por la
      Parte que solicite la copia.

   D. Los honorarios y los gastos de los peritos, asesores y
      demas que fueren presentados o consultados por una de
      las Partes, deberan ser pagados por Ia Parte que utilice
      dichos servicios.
      E. El Empleado o Aspirante deben1 pagar un cargo de
         $150 si el o ella inicia el arbitraje o mediaci6n. Aparte
         de dicho cargo, el Empleado I Aspirante no sera
         responsable de pagar los honorarios y gastos del pro-
         ceso efectuado de acuerdo a estas Reglas, incluyendo
         los vifiticos requeridos de un arbitro o mediador, AAA o
         JAMS, y el costo de cualquier evidencia que fuere
         presentada ala discreci6n del arbitro.

      F. Si la demanda para mediaci6n o arbitraje es iniciada por
          la Compafiia, dichos honorarios seran pagados por la
          Compai1ia.

      G. Salvo se indique lo contrario en las leyes vigentes o en
         el fa11o del arbitro, todos los otros gastos, honorarios y
         costos del proceso efectuado de acuerdo a estas Reglas
         seran pagados de manera equitativa por las Partes que
         no son Empl~ados/Aspirantes.

B. Interpretacion y Aplicaci6n de Estas Reglas

      El arbitro debeni interpretar y aplicar estas Reglas en lo que
      respecta a los poderes y deberes del arbitro. Todas las otras
      reglas deberan ser interpretadas y aplicadas por AAA o
      JAMS.

~4.   Ley A plica ble

      A. Los Procesos efectuados de acuerdo a estas Reglas y Ia
         revision judicial de los fallos deberan ser regidos por la
         Ley.

      B.   Salvo se indique lo contrario de forma expresa en estas
           Reglas, las leyes fundamentales aplicadas
           debenin ser leyes estatales o leyes federales funda-
           mentales que serian aplicadas por un Tribunal de
           Distrito de los Estados Unidos que tomara e1 lugar del
           proceso de arbitraje.

35. Mediaci6n

      En cualquier momento despues de que e1 proceso de arbi-
      traje haya concluido} las Partes podran acordar la
      mediaci6n de su disputa por medio de la notificaci6n de
      AAAo JAMS. AAAo JAMS deben1n determinar que pro-
      cesos se aplican a dicha mediaci6n.

36. Espaiiol

      Este Programa de Resoluci6n de Conflictos se encuentra
      disponible en ingles y en espafiol
Nabors Industries,   Inc~
      April 2001
fJII~
        17 de enero de 2007

        A:     Todos los Empleados de Nabors Industries, Inc. y Subsidiarias

        REF: Programa de Resolucion de Disputa de Nabors

        Estimado Empleado:

        A partir de diez ( 10) dias despues de la fecha de este aviso, de conformidad con la Secci6n 6 del
        Programa de Resoluci6n de Disputa de Nabors de Nabors Industries, Inc. ("Nabors") y sus subsidiarias
        estan enmendando el Programa y Reglamentos de Resoluci6n de Disputa de Nabors para la
        determinacion de todas las disputas entre los empleados y Nabors o una de sus subsidiarias.

        Las enmiendas al Programa y Reglamentos estan anexas en Ia parte posterior de esta pagina. Nabors
        estas enmendando una (1) secci6n del Programa de Resoluci6n de Disputa de Nabors y una (1) secci6n
        de los Reglamentos de Resoluci6n de Disputa de Nabors. Usted debe ya tener una copia del programa y
        los reglamentos actuales o pueden encontrarse en la Intranet de Nabors, de acuerdo ala politica numero
        200.80.1, en http://sharepoint.nabors.com/C10/Human%20Resources/default.aspx.

        Como antes, el Programa de Resoluci6n de Disputa de Nabors, incluyendo sus enmiendas, le da los
        medios mas efectivos y eficientes para resolver cualquier disputa que pueda tener, a traves del proceso
        que estimula la resolucion ala oportunidad mas inmediata. Los empleados no renuncian a alg(m derecho
        legal sustantivo de acuerdo al Programa. En su Iugar, el programa, incluyendo sus enmiendas, estipula
        que cualquier asunto legal sustantivo que pueda tener, sea resuelto sobre una base individual por
        mediacion o ante un arbitro neutral, cuya decision sera final y que lo obliga a usted y a la Compafiia. De
        acuerdo al programa. incluyendo sus enmiendas, sin embargo, usted renuncia a todo derecho de
        procedimiento que pueda tener para iniciar una acci6n judicial en base individual, colectiva, de clase o
        representativa; y usted renuncia al derecho de un juicio ante jurado en relaci6n con alguna disputa que
        pueda tener con la Compafiia o alguna Entidad Electora (como es definida en el Programa), que incluye
        alguna reclamacion de lesion o reclamaci6n de discri1ninaci6n en base a raza, origen nacional, genero,
        religion, edad o discapacidad ,de acuerdo con cualquier estatuto de derechos civiles federales o estatales.

        Cada individuo que trabaja para Nabors Industries, Inc. o una subsidiaria esta sujeto al Programa,
        incluyendo sus enmiendas, excepto que las disposiciones enmendadas afecten solamente a las disputas
        iniciadas despues de la fecha efectiva de Ia enmiendas y sin asuntos pendientes antes de Ia fecha
        efectiva. Su empleo continuado despues de la fecha en que reciba este aviso constituira su aceptaci6n de
        las enmiendas al Programa, tanto durante y despues de su empleo con la Compafiia.

        Esperamos continuar trabajando juntos. Si tiene alguna pregunta acerca de estas enmiendas al Programa
        y a los Reglamentos o a cualquier otro termino de su empleo, por favor, no dude en comunicarse con el
        Departamento de Recursos Humanos de su empleador.

        Atentamente,

        NABORS INDUSTRIES, INC.


                                            *Una copia de este aviso esta disponible en espatiol,
                       si la solicita a/ Departamento de Recursos Humanos de cualquier subsidiaria de Nabors.
fll~
                   Enmienda al PROGRAMA DE RESOLUCION DE DISPUTA DE NABORS:

       4. Resolution de disputas

           A. Todas las disputas que no sean de otro modo establecidas por las Partes senin finales y resueltas de
              manera concluyente, de acuerdo a este Programa y a los Reglamentos. Las partes renuncian a todo
              derecho que puedan tener a un juicio ante jurado sabre reclamaciones relacionadas de alguna manera a
              cualquier disputa.

          B. Cada disputa sera arbitrada sabre una base individual. Las Partes preceden y renuncian a cualquier
             derecho para unirse o consolidar reclamaciones en arbitraje cono otros o para hacer reclamaciones al
             arbitraje como un representante o como un miembro de una clase o en capacidad de abogado particular o
             similar, a menos que tales procedimientos sean convenidos por todas las partes. Ni la Compafiia ni alglin
             Empleado o Solicitante puede continuar alguna Disputa sabre una base de acci6n de clase, de acci6n
             colectiva o consolidada o en capacidad de representaci6n de otras personas o entidades que hayan
             reclamado estar situados similarmente o participado como un miembro de clase en tal demanda. El arbitro
             en alguna demanda de acuerdo a este Programa no tendra autoridad para conducir el asunto como una
             acci6n consolidada, de clase colectiva o de representaci6n.

          C. Si la limitaci6n del procedimiento en el Parrafo B de esta Secci6n no puede hacerse cumplir por un
             tribunal en una demanda en la cual una parte busca ej ercer una acci6n consolidada, de clase o colectiva, o
             actuar de otra manera en una capacidad de representaci6n, entonces este programa aplicara a tal demanda
             solo al siguiente alcance. El tribunal decidira si la Disputa debe proceder sabre una base consolidada, de
             clase, colectiva u otra de representaci6n y, si es asi, definira el alcance de la clase. Ninguna de las
             determinaciones anteriores sera remitida al arbitro y en ninglin caso el arbitro tendra el poder para
             determinar la certificaci6n de acci6n de clase, colectiva o de representaci6n. Las decisiones del tribunal
             estaran sujetas a apelaci6n en conformidad a las reglas de procedimiento aplicables. Si el tribunal certifica
             una acci6n de clase, colectiva u otra representaci6n, entonces todas las otras determinaciones, dentro o
             relacionadas con la Disputa, seran hechas por el arbitro. El arbitro determinara las preguntas de
             responsabilidad para, o de la clase, como un todo y los remedios disponibles para o de la clase, como un
             todo. En arbitro tambien decidira el desagravio, silo hay, al cual una parte o miembro de clase puede
             tener derecho individualmente. Si el tribunal, no obstante, niega en ultima instancia una solicitud de una
             parte para proceder sabre una base consolidada, de clase, colectiva ode representaci6n, entonces esa
             reclamaci6n individual de la parte estara todavia sujeta a este Programa y referible al arbitraje en
             conformidad a sus terminos.


       Enmienda a los REGLAMENTOS DE RESOLUCION DE DISPUTA DE NABORS:

       30. Alcance de Ia Autoridad del Arbitro

          A. La autoridad del arbitro sera limitada a Ia resoluci6n de Disputas legales entre las Partes. Como tal, el
             arbitro estara obligado y aplicanila ley pertinente, que incluye aquello relacionado con la ubicaci6n de la
             carga de la prueba, asi como la ley sustantiva. El arbitro no tendra la autoridad, ya sea de abreviar o
             aumentar, los derechos sustantivos disponibles de acuerdo con la ley aplicable. El arbitro tambien puede
             otorgar desagravio de emergencia o temporal que sea o seria autorizado por la ley aplicable. El arbitro
             estara obligado y cumplira con las disposiciones del Programa y los Reglamentos.

          B. El arbitro no tendra el poder de escuchar reclamaciones en el arbitraje como una acci6n de clase o
             colectiva, o en capacidad de abogado particular o similar o sabre otra base de capacidad de
             representaci6n, o ausente el consentimiento de todas las partes, sobre una base consolidada. El arbitro
             estara autorizado a decidir solamente las reclamaciones disputadas entre las partes individuates.
     ',
· Nom: Tlils form     con1~
                                                               .                                                               .
                              is a suggested guide! and use of this rorm or any variafion there<>! sh3U be at th$ sole discretion and risk of the user parties. Users
  of the form contract or any portion or variation thereof are l!!ncouraged to seek !he advice of counsel to ensure that their conlrnct reflects the complete agre{lment
  of the parties and applicable law. The International Association of Orilang Contractors disclaims any liab!Jity whatsoever for loss or damages whiCh may result
  from use of \he form conlrnct or portions or variations thereof. Computer generated form, reproduced under li<;ense from IAOC.

                                                                                                                                                                   Revised April, 2003
                                                      INTERNATIONAL ASSOCIATION OF ORIWNG CONTRACTORS
                                                                   DRILLING BID PROPOSAL
                                                                            AND
                                                               DAYWORK DRILLING CONTRACT· U.S.



 Please submit bid on thfs drilling contract form 1or performing 11\e w0111 CXJ~ined below. upon the terrru> and for the consiclera1ion set forth, with the undernla!'lding ~t
if the bid is acoepte<l by --~--------,-----:-------:--:-------::-:-:-----------=---
this ins!I1Jment will constitute a Cor\lrnctbetween us. Your bid $hould be malledotdeliv<;!ted notla1er!ha.n P.M. on , 20
to the following address:


                                   THIS CONTRACT CONTAINS PROVISIONS RELATING TO INDEMNITY,
                                         RELEASE OF LIABILITY, AND ALLOCATION OF RISK-
                                             SEE PARAGRAPH$ 4.91 6.3{c), 10, 12, AND 14
Till$ Contract ls made and entered inlo oo the date hereinafter set forth by and between the parties herein designated as 'Operator' and •contractor:
      OPERATOR:        Penn VIrginia 011 & Gas, lP
      Address:         840 Gassner Road, Suite 800
                       HOU5ton, Texas 17024
          CONTRACTOR: NABORS ORILl.ING USA, LP
          Address:         515 w. Green$ Road, Suite 1000
                           Houston, Texas 770U7
IN CONSIDERATION of the mutual promises, conditions and agreements herein contained and the specification$ and special ptovislol'l$ set forth in Exhibit 'A• and Exhibit
'B' attaChed 1\eteto and made a part hereof (the ·contract"), Operator engages Contractor as an Independent contractor to drill the llereinatter designated well or wells in
sea~       of oil orgas on a Daywork Basis.


For purposes hereof, the term 'Oaywork' or ·oaywork llasit' means Contractot shall li:Jmlsh equipment, labor, and perform services as herein provided, fot a specified ~m
per day under the dir~tion, supervision and control of Opera.tor (inclusive of any employee, agent, consultant or subconttactor engi!ged by Opetator to direct dniling
opera.tions). When op~Uafing on       a      Daywork Basis, Contractor shalf be fully        para at the    app/ieflble rates of payment and assumes only the obllt~atJons and
lfabllftlu st<lted herein. Except for .such: obligations and llabllltiu sprtelffca/{y assumed by                Ccntrt~ctor,   Opernor shall be solely responsible and assumeJ>
lhlblllty for ail consequences of operations by borh p;utles while on a Cayworlc Basis, Jnclurflng resuln and all other risks or liabilities Incurred fn or lncfdent to
such operations.
1.        l.OCATION OF WELl.:
          WeliName                       •
          and Number: To be      adv1sed by Operator
          ~I                                                                                        Field
          coonty: Jefferson                            _T:..;e:::x:=a::;:s:______ Name:
                                                               smte:                                            ------------------
          Welllocation and                                                                                    --
          land description: To be   advised by Operator
          1.1 AddiUonal Well Locations or Areas: None.
LO(alfons described above are for well and Contract ldentif'tealion only and CO!llrnctor assumes no liability whatsoever for a. sxoper survey or location stake on Operator's
lease.
2.    COMMENCEMENT DATE:
      Contractor agrees to use reasonable effort& to commence <>perations for1he dJiKing of the wen~                            ~                                :-:!0
~* immediately following rig rel~ase from Contractor's current customer. lf Operator does not provide a - -
sound location to accept Contractor's rig immediately following rig release from Contractor's current
customer, Contractor shalf have the right to terminate this Contract unless Operator pays Contractor the
Standby Time Rate from such release date until the location is ready. If Contractor so terminates, the
termination shall be deemed to be a termination at Operator's election, and the provisions of Sub-paragraph
6.4(a) shall apply.
3.   DEI>'rn:
     3.1 Well Depth: The well{s) shall be dlilled 1o a depth of awoximately         10,500'           feet,~---------------
~Ill~~. but the Contractor shall not be required Mteunder to drlli said well(s) below a maximum depth of - - , - - - - - - - feel, unless
Contractor and Operator mutually agree to drill to a ~realer depth. - Not to excHd capacity of rig as described on tho rig lnventQry attached herein.
4.    OAYWORI\ RAreS:
      Contractor Shall be paid at the following rates for the work performed hereunder.
      4.1 Mobllixatlon: Operator shall pay Con\raclor ~                                                             <Of a mobilization day rate of S
per day, This sum shall be due and payable in full at the time the rig is rigged up or positioned at the well site ready to spud. Mobilization ShaliTriCitide:
Move-in and rig up on the new well site.
*Plus actual costs of trucks, cranes and pennits an<l                                                for man-lifts, lisht towel'$ and string up services.
     4.2 Oemoblli::alkln: Operator shaU pay C<mtractor a ~smeeilizaliaR fee ar;.                                              *a demobilization day rare ~~f
S                                    per day, PfQvided hOWever that no demobitl1.alion fee. shall bli! payable If the Conlrnctls terminated due to the total foss or destruction
ofthe rig. oemobilttatlon sh~e: Rig down and remove rig from the final well location and, if applicable, move the
rig to the nearest suitable stack out location.
"Plus actual costs of trucks, cranes and permits anc                                                 for man-lifts, light towers and string down
services.
--4.~J~a r\Rlf Rate; l:>wl'iAglf.letlme 'lie fig ja.ift~m~~site&, oommaR~.()Il - - - - - - - - -
~.;                                                   part•raR\yfG~<r{:l1)lle·rsa~··

      4.4 Operating Day Rate: For work performed per twenty-four (24) hour day with                            Five_,{5;,.,c.)_ _ __ man crew the operaling day rote shall be:
                       Depth Interval$
            From                                 To                                    Witlwut Drill Pipe                                        With Drill Pipe
             ·o                        Rig Release                           $--··                              per day                s__     __ _ per day                                 EXHIBIT
                                                                                                                                       s _________ perday
                                                                                ---------per day
Using Operator's drill pipe$ - - - - - - - - p e r day.
                                                                            S                                   ~relay                 S                                perday



The rata will begin v..hen the drilling unit is rigged up at the drilling loeation, or positioned over the location during marine work, and re;;dy to commence operalions; and will
                                                                                                                                                                                         I c
cease when the rig is ready to be l'l'loved off the klcation.

                                                  (U.S. Oaywotl< Col!fract • Page 1}
                            Copyright tO 2003 lntema.tlonat Association of Drilling Contractors
                                                                                                                                      Form provide(f by Forms On·A·Dis!c
                                                                                                                                     {214) 340·9429 • FormsOnADisk.com
                                                                                                                                                                                 ~~
                                                                                                                                                                                 ~\\\)~
                                                                                                                                                                                       t\
                                                                                                                                                              NCPS 00            r9~3
             ·--~····--···-···· -------------~--------




If under 1he aboVe column 'With Dtilt Pipe" no rates are specified, the rate per twenty-four hOUt day when otill pipe is in use shall be the appliCable rata specified in the
column :without Drill Pipe" plus compensalion ror arty drill p!pe actually use<~ at 111e rates spedtied b.!rtow, computed on 1he basls of the maximum drill pipe In use at any

time during each 1Wenty.fo!Jr hour day.
                                                                           ORIU PIPE RATE PER 24-HOUR DAY
                                                                                                       Olrectfonal or
             Straight Hale                            Site                  Grade-              Uncontrollable Deviated Hole                                                 Grade
                 N/A            pertt.                                                                         N/A              perft
                 NJA            perlt                                                                          NJA              perft.
                 N/A            pertt                                                                          N/A              perf!.

Directional or uncontrolled deviated hole win be deemed to exisl When devialion exceeds----- degre<a& or When the change of angle exceeds - - - - -
degrees per one hundred feet.
      Orilf pipe shalt be considered in use not only When In actual use but also Yll!ile it is baing picked up or laid down. When drill pipe is standing in the derrick, it shall not
be considered in use. provided, however, that lt' Contractorfumishes special strings of drill pipe, drill collars. and handftng tools as provided for in Exhibit •A", thee same shall
be considered in use at all times when on IOC<Ition or un1il released by Operator. In oo event shall ~!ions of an h<M be COO$iclered in computing the amount of lime drill
pipe Is in u:~e but such time shall be computed to the nearest hour. with thirty minule$ or more beif19 considered a full hour and less than thirty minutes not to be counted.
      4.5 R~pa!r Time: In the ev~nt It Is necessary to shut down Conl!ador's rig for repairs, ex(:luding routine til) servfcing, Contractor shall be allowed
compensation at the applicable rate for such &hut down time up to a maximum of                 eight 18\    hOurs for any Qne rig repair job, but not to exceed twentv-four f24l hours
of suCh. compensil!ion for any calendar month. Thereafter, CQntractor shall be compensated at a rare or$                   zero 10\           per twenty-four (24) hour day, Routioe.rig
servicing shalf include, bvt not be limited to, cutting and slipping drilling line. changing pump or swivel expendables, testing BOP eqvipment, lubricating tig, arnl
                                                                                       to be



to begin or resume operatiotls but Con1Tactof is waiting <:m orders- of Operator or on materials, services or other iteni3 to be furnished by Operator.
      4.7 Drilling Fluid Rates: When l1rilllng fluid$ of a type and Characteristic !hat increases Contractor's cost or performance hereunder, including, but not llmitoo to,
oil-based mud or potassium chloride, are in use, Operator $1'1~11 pay Contractor in addition to the opera!illg rate specified above:
               {a} $_              _per man per day for Contractor's rig-site personnel.
              {b)  $_            _ per day additional operating rate: an<!
              (c)  Cost of alllabo!', material and $eMces plus          (Wentv..four t24l      hours operating rate to clean lig and related equipment.
                                       100% of til9 Operating Day Rat!)
      4..8    Force Majeure Rate: $                              pet twenty-four (24} hOur day for any continuous period that normal operaliorts are s.uspe11ded or caoool be
carried on due to eoodilions of Force MajeUre as defined in Paragraph 17 hE!reof. It is, however, understood that subject to Subparagraph 6.3 below, Operator
can release 1he rig in accordance with Operator's right to direct stoppage of the work, effective When condilio!ls wiil permit 1he rig to be moved from the location.
      4.9     Retmbul'$;tble Co$!:s: Operator shall reimburse Contractor for the costs or material. equipmel\t, work or services whiCh are to be rumfshed by Operator as
provided for herein but whiCh for convenience are actually furnished by Contractor at Opeflltors reqlll;!st, plus             t11n {liD       percent for such cost of handling. When,
at Operator'$ request and with Contractor'$ agreement, the Contractor furtll!ihe!> or subcontracts for certain items or services which Operator Jsl'l)qulred herein
to provide, for p1.1rposes cf th& Indemnity and release provl!ilons 'Of thTs Contract., :said Item$ or servlcf!.$ shall be               d~ed       to be   Op~or fuml!>h~ Items     or
servlces. Any subcontractors so hired shall be deemed to be Operator's contractor, and Operator shall not be relfeved of any of Jts 1/ablfities In connactlon
therewith. Notwfths~ndlng th~ foregotng, Contractor shalt not. be obliged to purchase any items on behalf of Operator.
      4.10 Revlsl(lll in R~: The rates and/or payments herein set forth due to Contractor from Operator shall be revised to re11ect !he change in costs if the costs of any
of the ilems hereinafter listed shall vary by more than           ;U1'9 101      percent from the costs tnereor on !he date of this Contract or by the same percent after the dale of
any re\l!slon pursuant to thfs Subparagraph:

              {a)    Labor costs, Including all bene!lts, of Contractor's personnel;
              (b)    Contracto(s cQSI of insurance premiums:
              ~~     ~~~=~~ ::~~~~~~~.~:na::!:bie7 tees; the cost pergaUoniMCF being $__..Nw1A::~....._ _: Operator shall provide all fuel.
              (e}    If Operator requires Contractor to incrr:ase ?r decrease the n~mbar of Conlraclo(s personnel;
                                                                                                                              ~a-                           pa1~At et-~~~
                     ~tfle..:pal'liessl:lall!!&al~eiJ.S~~~~~·~~~~siCWPY119192}
                     194eie~~~
              {g}(t) If there i$ any ChMge ill legislation or reguta~ons.ln the area in whicll Contractor is working or other unforeseen, unusual event that altets Conlractor's
                     finandal burden.
5.    TIME OF PAYMENT
      Payment is due by Operator to Contractor as follows:
      5.1 Payment for      mobili~atton,   drilling and other viOri<: performed at applicable rates, and all otl1er applicable dlatges shaU be due, upon presentation of invoice
!here1or,upoo completion of mobilization, demobiliultlan, rig release oral the end of the month in Whfdl suCh \YOfY. was perfonned orotherdlarges are Incurred, Ylhiehever
shalf first occur. AD invoices may be mailed to Operator at thb address hereinabove shown, unless Operator does hereby designate that such invoices shall be mailed as
folloWs: _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __

      5.:2 Disputed lnvofc§ and tate P;~ym~t~ Operator shall pay alf Invoice~ wilhin                   thirty pOl days after receipt      eJ~cept   that if Operator disputes an invoice
or any part thereof, Operator shall, within fiff.een days after receipt of the Invoice, ootlfy contractor of the item disputed, speclfyiflQ the reason therefor, an<:l payment of 1he
disputed item may be wlthheld untlt $et1lement of the dispute, but timely payment shall be made of any undisp\Jied portion. Any sums (including amounts ultimately paid
with respect to a disputed Invoice} not paid within the above specified days shall bear Interest at the rate of               1112            percent or the maximum legal rate,
wflichever is tess, per month from tha due dale until paid. lr Operator does not pay undiSputed items. wilhin the above stated lime, Contractor may suspend opetaUons or
terminate tllis Contract as specified under Subparagraph 6.3.
6.    TERM:
      6.1     Duration of Contract: This COntract sl'lall remaln In full fotee and effect until driUing operations are oompleled on the well~ specified In Paragraph


                                                                                                              wel!(s)Grfsra~;:::-·==============
by··9M!A!rRGtl~~~~~!t-least.===~ia¥!l...er'ior~~ftt.\e• >!!lrl!=ieA ilel~.or-ll;<-_.l:l,ot....,u,....s_,ed"".--------------

      G.:S    Early Termination:
      (a}     By Eithe-r Party: Upon giving of written notice, either party may terminate this Contract when total toss or des1Nction of lhe rig. or a major breakdown With
Indefinite repair tlme necessitate stoppitlg operations hereunder.


                                                 (U.$ Cl<lywork. Cotllract. ·Page Z)                                                  Form provided by Forms On-A-Disk
                             COpyrighi (!:/ 2003 lntemati011a1 Assocla1ion of Drilling Contract¢r$
                              ........---·· ---·-·····"····----·-·····---~·--··--------·-·---~-·----




         {b)
                                                          e                                                                     -                                        Re~April,
               ay Operator: Notwlthstandfng the provisions of Paragraph :; witt\ respect to U1e depth to be drilled, Operator shall !lave the right to direct the stoppage of the
                                                                                                                                                                                        2003


  work to be performed by contrQctor hereunder at any time prior to reaching the specll!ed depth, and even though Contractor has made no defavft hereunder. In such event,
• Opefatoi- shall reimburse Contractor as set forth in Subparagrnph 6.4 hereof.
         (c)    By Contractor. Notwith$tanding th& provisions of Paragraph 3 with respect to !he depth 10 be driUed, in the event Operator shall become insolvent, or be
  . adjudicated a bankrupt. or file. by way of petition or answer, a debtor's petition or other pleading seeking adjustment of Operator's debts, under any bankruptcy or debl.of's
   relief laws now or hereafter prevailing, or ir any !luch be filed agalllst Operator, or in case a receiver be appointed of Operator or Operators property, or any part thereof, or
   Operator's affairs be placed in the hands of a Creditor's Committee, or. following three business days prior writlen notice to Operator if Operator does not pay Contractor
   within the time specified in Subparagraplh 5.2 all undisputed items due and owing, Conlractor may, at Hs option, (1} elect to terminate further performance of any work under
   this Contract and Contractor's right to compensation Shall be <I$ set forth In Svbparagraph 6.4 hereof, or {2} SIJSpend opefations vntil paytne11t is made by Operator in whlch
   event the standby time rate contained In Subparagraph 4.5 $hall apply untlf payment is made by Operator and operations are resumed. In addltlon to Contractor's tight$
   to scr.;pend operations or tenninate perlotmance under this Paragraph, Operator hereby expressly agrees tQ protect. defend and Indemnify Contractor from and
   egafm;t any claims, demands and causes of action, fncJU<Ifng all costs of defense, In favor of Operntor, Operator's co-v~mwrers, co-lessees and jofnt owners, or

   any other parties arfsing out of any drilling commitments or obligat/oi!S cont.t1ned in any ltmse, farmout agreement or other agreemellf. which may be affected
   by such suspension of operatlonr:s. or termination of performance hereunder.
         6.4   Early Termination Compi!nsation:
         (a)   Prior to Commencement: In ihe event Opefator terminates this Contract prior tl} commen~ement of operations hereunder, Opef3tor shall pay Contractor as


         {b)   Prior to Spudding: It such termination occurs after <:Ommencement of operations but prior to the spudding of lhe well. Operator shall pay to Contractor the sum
   of the following: {1) all expenses reasonably and necessanly lnt;~.~rred and to be incurred by Contractor by reason of lt'le Con!Jact and by ~SOil of the prema1Ure tefmlnation
   of the wort<, Including the expense of drilling or other crew members and supervision directly assigned to the rig; (2) len percent (10%) of the amount Of such reimbursable
  expenses; aod (3) a sum cafeulated           at the standby time rate for i!ll time from !he date upon which COntractor commences any operatioos hereunder down to such data
   subsequent to !he date of termination as will afford COntractor reasonc;ble lime 10 dismanlle its rig and equipmentilfiW~~a
  iRaR '-lRe "'ell er fer a pe<lg<J sf lime. 0~--~actOr~-a~Ge··~e~-~klate

  =w=~ve. 151 days at ttJ!t Standby                                    llm!t R~te .    .         fpme~lle-af!G~n'l·O!'·                  pills as liguklat!;d dpmagn and ngt as


         {c)   Subsequent to spudding: If such termina1ion ocwrs after the spuddi09 of the well, Operator shall pay Contractor (1) !he amount for all appliGable
  rates aod all ot~r ellarges aod reimbursements due 10 Contractor; b!.Jt in no event shall such svm. exduSiW!> of reimb!.Jt!lerneots dVe, be less tha~ would have
  been earned for _ _ _.u.:f!v..,e'-"(!!J.----- days at the applicable rate "W~hout Drill Pipe" and the actual amount due for drill pipe used in aocordance with the above
  rates: or {2) at the election Of Contractor and in lieu of the foregoing. Operator shall pay Contractor for all expenses reasonably and necessarily incurred and to
  be incurred by reason of this Contract and by reason ot such premature termination plus, a-~t.$                                                       p«wlsed, M• a   at, if ttl is GGRtfaGt
  ~na11                            aRe "e!l sr rar a jilaRaa ar ~1*!1'~1!-~ctar, iR alleitle~be •e, tl'le FarGe Haje11re Rate less aRy \IRAec;essaf)
  tallef:4~ta~ll~-~                                                    n liquidated damaaM and not as oenaltv a lump sum equal to five !5! dm at the Standby TI® Batt


  7.    CASING PROGRAM
        Operator shall have the right to designata the points at which C(l.$ing will be set and 1he manner of $e1!ing, cementing                ;:~nd   testlrlg. Opet<ttor may modify tne
  casing program. however, any such modification which materially lncrea$eS ContractO(s hazards 01 costs can only be made by mutual consent of Operator and
  Contractor and upon agreement as to the addiUonal compensation to be paid COntractor a$ a result thereof.
  lt.   ORILUNG METHODS AND PRACTICES:
        8.1    Contractor shall mllil'llain well control equipment In good condition at all times and shall use all reasonable means to Pfevent and control fires and blowouts and
  to protect lhe hole.
        8.2    Subject to the terms hereof, and at Operator's cost, at an times duri09 the drifting of the well, Operator shall have the right to control the mud                 pr~ram.

  and the drilling fluid must be of a type and have characteristics and be mllintained t:Jy Contrnctor In acoordance with the specifications shown In Exhibit "A•.
        8.3    Each party hereto agrees to comply with all laws, rules, and regulations of any federal, state or local governmental authority which are now or may
  become applicable to that party's operations covered by or arising out of the performance of this Contract. When required by law, !he lerrns of Exhibit "BM shaH
  apply to thlll Conlract. In the event any provision of till$ Contract 1$ Inconsistent with or contrary to any applicable rmral, state or local law, rule or regulatiOn,
  said provision shall be deemed to be modified to the extent required to eornply with said law. rule or regulation, and as .so modified said provision and lhis Contract
  shill! coolintse In full force and effect.
        8.4    Contractor shall keep and f\lrnlsh to Operator an accurate record of the work performed aod forma\loo$ drilled on the IAOC-API Dairy Oriut09 Repor:t Form
  or other form acceptable to Opera lor. A legible copy of said form shall be luml$hed by Contrnctor to Operator.
        8.5    If request~ by Operator,         Con1ractor 'ihllll f\lmish Operator with a copy of delivery tickets covering any material or supplies provided by Opera!Or and
  received by Contractor.
  9.    INGRESS, EGRESS, AND LOCATION:
        Operator hereby assigns to Contractor all necessary rights of ingress and egress with respect to lhe tract on whlch the wen is to be located for the performance
  by Contractor of all work contenlflla(ed by this Contract. Should Contrac!Of be denied free ac:Gess 10 the location for any reason not reasonably Within Contramor's
  control, any time tost by Contractor as a result of such denial shall be paid for at the standby ttme rate. Operator agrees at all times: to maintain the road and location
  ln sud\ a eondltiOII that will allOw free access and movement to and from the driNing site in an ordinarily equipped highway type vehiCle. lf Contractor iS requited
  to use bulldozers, lractors, four-wheel drive vehides, or any other specialized transportation equipment for the movement of necessary personnel, machinery,
  or equipment over access roads or on the dolling location, Operntor shall furnish lhe same at its expense and Without cost to Contractor. The Qctuel cost of repairs
  to l!ny transportation equipment furnished by Contractor or its personnel                d<Jmag~   as a   ~suit   of Improperly maintained access roads or location will be charged
  to Operntor. Oper~or shall reimburse Contractor for all amounts rea;onably expended by Contractor for repairs and/or ;einforcement of roads, bridges and related
  or similar facilities (public and private} required as a direct result of a rig move pursuant to performance hereunder. Operator shan be responsible for any costs associated
  with reveling the rig because of loCatiOn settling.
  10.   SOUND lOCATION:
        Operator shall prepare a sound location adequate In size and capabte of properly supporting the drilling rig, and shall be responsible for a casing and cementing
  program adequate to prevent soil and subSOil wash QlJt. It is recognized that Operator has superior knowledge of the location and access routes to the location, and mttsi


                                                    (U.S. Daywoti< Contract·   P~ 3)
                               Copyright 4:12003 lntamationa! Association of Oril!iog Contr~ctors
                                                                                                                                         Form prOVided by Forms On·A·Disk
                                                                                                                                        {214} 340-9429 • FormsOnAOi$1\.COtn
                                                                                                                                                                                ~t--           ·
                                                                                                                                                                                 :\1"\..\J:;;>t'
                                                                                                                                                                    NCPS             lV9~5
         •
                                                        e                                                                e
a!,lvise Contractor of any subSurface condillons, or ab$tructlons (mduding, but not li.mited to, mines, caverns, slnl<. holes, streams, pipelines, power lines and
                                                                                                                                                                      _
                                                                                                                                                                  Rt~~ April,   2003


communication lines) Which Contractor might efl(X)unter while en route 1o 1he Jocailon or during operalions hereunder. 1/l the event subsurface ccmditlons cause a
craterin'g or shifting of the loc~tlon surface, or if seabed condltfons prove ufl$flt/sfactory to properly support the rig during marine operations hereunder, and

toss or damage to the           tig   or Its assocli!ted -equipment results therefrom, Operator shall, Withcvt regard to other provisions of this Crmtract. Including
Subparagraph 14.1 hereof, «tlmburse Contractor for afl such Toss or damage lncfudlng removal of debris and payment of Force Majeure Rate during repafr

and/or demoblfi:tl1tlon If iilppl/cable.

11.   EQUIPMENTCAPACITY
      Operations shall not be attempted under any COflllitions which exceed the capacity of 1he equipment specified to be used hereunder er •fllera GaRal-ar •~ater t:apiRG
~l(Ge&G-of                                                       - . -teet. Without preJUdice to 1he PfOYisions of Paragraph 14 hereunder. Contrae1or shall have the light to make
the final decision as to when an operation or atlempted o~ratiQn would exceed the capacity of specified equipment.
12,   TERMINATfON OF lOCAilON LIABILITY:
      When Contractor          hn concluded operations at the well location, Operator shall thereafter be liable ror chmage to propeny, personaT Injury or death
of any person which occurs as Jl result Of condltJons of the location and Contrar:tor shalf be refleved of such liability; provided, however, If Contrar:tor shall

subsequently rnenter upcn the location for any             reason,   Including removal of the rig, any term of the Contract relating to such reentry llctivlty shall become

appffcable during such period.

13.   INSURANCe
      Ouli~      the life of this Contract, contractor shall at Contr~ors wqJense maintain, with an Insurance compa~y or companies authorized 1o do business in the
state where !he work is 1o be perfoJ'll'led or through a self·insurance PfOQram, Insurance COYefC!96S of the kind and in !he amount set fonh in Exhibit "A", insuring the
liabilities specificany assumed by Contraelor in Paragraph 14 of this Contract. Contracfor sha!l procure from the company or companies writing said Insurance a certificate
or certificates that said Insurance is In full f¢rce and effect ami that     tne   same shalf not be canceled or materially cllaoged without ten (10} days Pfior written notice to
Operator. For liabi!iiies assumed hereunder by Contractor, its insurance shall be endorsed to provide that tile underwriters wai11e their right orsubrogaUon ~ainst Operator.
Operator will,   <1$   well, cause its Insurer to waive subrogallon against Contractor fOI' liability It assumes and shall maintain, at Operi!lor's expense, or shall setr lnS\Ife,
insurance co~~erage <1$ setrorth In Exhibit •N or 1he same kind and in the same amount as Is required of Con!ractor. insuring 1he liabilities specifically assumed by Operator
in Paragraph 14 or 1his Contract Operator shall procure from the company or companies WTiling said insurance a certifiCate or <:ertiflCSies 1hat said lnsvrance Is in hJII (Orca
and effect and that 1he same shan not be canceleo or materially <:hanged Without ten {10) day$ ptior written notice to Contr~or. Operator ano Contractor shall cause their
re$pecllve underwriters to name the other additionally insvred but only to the exteno of the lndefnl'lification obUga1lOns assumed herein.
14.   RESPONSIBILITY FOR LOSS OR OAMAGE,INOEMNJTY, RELEASE OF LIA81U1Y AND ALLOCATION OF RISK:
      14.1 Contractors Surface Equtpmeltt: Contractor S/la/1 assume liability ;it a1f times        rw damage to or destruction o1 Contractor'$ $urface l](lllipment, regard/W. of
When or how such damage or destruction occurs, and Contlactor :shall release Operator of ;my /(ability for any such foss, ~txcept loss or damage under the
provisions of Par<Jgraph 10 cr Subparagraph 14.3.

      14.2 Conttactol'sln-f/o~ Equipment: Operator shall assume liablllty at all ttmu for dJmlf94 to or destruction of~ in-hOle equipment, li!Cflldfng, bvt not
limited to, driJJ pipe, drilf colf<~rs. and~~ join!$, and Op11rator .shall reimburse Contractor for the value of ;my ~>uch toss or darrntge: the value to be dettmnlned

by agreement between Contractor and Operator iii$ cumJnt repair costs or                     100      percent of current n&W replacement cost of such equipment delivered
to the weft site.

      14.3 Contractnn; Equipment - Environmental Loss or Damage: Notwftlutandlng the provisions of Subparagraph 14.1 above, Operator shalt .assUI!i<l' llablllty

at all times for damage to or rilmrucfJon of Contractor111 ~tqulpment rnsultfng from the ptl!Sertee of Hz$, CO: or other corrosive elements that enter the clri/ling ffuk/S ftcm

subSurface formafiotts or the use ofco~. destructive or a!Jras/ve arldifivtss in the dTf1Hng fluids.

      14.4 Operotons Equlpmmt: Operator shaH <ISSIJI7le TiabfJity at all times for tiamage to or d(l!i(roctfon of Operator's or its co-venturers~     Cl)o-/essees' or joint OIU1efS'

equipment, Including, btlf not fimlfed to, casing, tubing, weJI head {lqu/pment, and platform If applicable, regardless of when or how such damage or destruction

occurs, and Operator shall release Contlar:tcr Qf any lfabllfty for ;my such lOss or damag~.

      14.5 Tb~ Hole! lrt the      event the: hole should be lc$t or damaged, Op(l(afor sh~ be $CI-ely rasponsfble for such damage to or toss of the here, /nduding the casing
therelrt. Operator sh<l/f release Contractor and Its supplieJ-s, contradors and subcontmctors of any tier of any li$1/ity f<H' ~ to or toss of the hOle, and shall PI'Otllct,
defMd and Indemnify ContraCCor and Its suppiiiUS, contractors and .wbcontfactors of any tier from .md against any and all claims, liability, and expense relating to

such da.m/Jge to or foss af the hole.

      14.6 Underground DMTage: Opentor S/lall rekt<l$e Contractor and Its suppi/IUS, contrecrors and :subcontractors or any 1Jer of any llabt7ity for, and shlttl protect,
defend and Indemnify Contractor and lr:s st~ppllers, conrractcrs lillld subcontractors of any tkr from and against any and all cfafms, 1/ablflty, :md eJq>enStt rasulilng from
opetat/Oil!S unw thts Contract on account ofInJury to, desfruction of, or toss or Jmpa/rm&nt ofllfiY propeny ffgtd in or to oil,    gas, orothw mlnera1 substance or~ If at
tile flme cf1he #ct or omls.slon causing sUCh injury, destrtictiQn.Joss, or lmpalrrnettt, .said substance had not been reduced to phy.;Jcal p¢.$$eSSion above the surra~ of th~
earth, and for any lOS$ or dama~ to any fotmatfoo, strata, or reservoir beneath th-e surlace of th-e ~Jarth.

      14.7 Inspection of M~.als Fumf.slled by Operator: contractor agr6(:S to vlsuatry Inspect all materials fum/shoo by Operator b$tore using                       seme and to
notify Opetator of any apparent defects ~ Contr.lctl)r shall              not be 1/abfe for any loss or damage Te~Witing from tim use Qf material$ fum/shed by Operator, and
Operator shall relea$e Cornractor from, and shall protect, d&fend and Indemnify Contractor from end against, any :such liability.

      14.8 Contrnctors flldemnlflca1ion of Oper.ator. Contractor shall release Opeliltor of any Hab/11ty tor, and shall proti!C(. defend and Indemnify Operator from and
agafnstBIJ cJalms, demands, and ceases ofaction ofwery ldnd and c.lr.lract«. wflhout.limltandwfthout regard to-the caus& or causes thereof orthif negtlgenc4 allfnY party

or p:artz'es, arlsihg in connection herewtth In fiMw of COntractor's empk>yees or Confrlldor's subcontractors of any tier (Inclusive of any 8g(l(lt or consu1tartt fll1{}a9ed by

Confr.lctorj or their employees,. or Contractor's IIW#ees, on          account   of bO<iiiy Injury, cfe.afiJ or cia~ to property. Contractor'$ llldemntty untlf!1' thfs ~ph
sJWI be Without regard to rmd wffhout sny right ro con1rfbutfon from any Insurance maintained by Operator pursuant to Paragraph 13. If it Is JtJdJcfaJJy d<Jtemllned
that the moneta!}' 1/mJts of Insurance required het'eunder or Qf the fndemnitlas voluntarily assumed una« Subparagraph 14.3 (wflicll Contractor and Optlfator heruby
agree l'lill be suppcrted either by -avaiWJhlllabJfity ins~~~ance, under which the Insurer has no rlgtrt of subrogation aga/lm the lnchlmnities,. or voluntarily self./nsured,
Jrt p;Irt or Whole) 1!XCee<i the maximlkrl limits permuted under applicable law. it Is agreed that           sald Insurance   requfrements or Indemnities $halT   a~Ty be
amended to conform to the maximum monetary limits permlt(ed under such law.
      14.9 Operator's lnciemriificatfon of Contractor: Operator shalf IWGaSe Cotttractor of any 1/ablltty for, and shalf prorect, defMd and lnOOnutlfy Cooaactor from and

aga/rlst Bl1 ctafms, demands, and causes of action ofwerykfnd am:! character, without rzmlt and without regard to the         cause or causes thereof or the negligence Of any
party or parties, arising in conn«:tlon herewith tn favor of Op~m~tar's employees or Operator's contractors of any tiN (lncluslve of any agent, conwftant or
subContractor engaged by Operatof1 orthwempfoyEe$. or Operatcr'slnvftees, other than those parlies Identified in Subpamgraph 14.8 on account of bodily Injury, death or


                                              (V.S.   ~yworl<
                                                            COOtract- Page 4)
                              Copyrlght e 2003 lntemationat ASSO!;iatiQn of Ofilling ContraciO!$
                                                                                                                                   Form pro11ided by forms On-A-Disk
                                                                                                                                  (214) 340·9429 • FQrmsOnADisk.com
                                                                                                                                                                              ~'
                                                                                                                                                                               \~~
                                                                                                                                                                              I_ ~\\)-\.}
                                                                                                                                                           NCPS 000 46
            ......   ---·····'-·--·--··· ····---..····--·-······           ·-----------

          .                                                e
damage to property. Operator's Indemnity under thl$ Pltl3graph sh<lll be withollf tegttrrt to and without any light
                                                                                                                                e   to   cotltlibutfofl from ooy insiJrarH;e
                                                                                                                                                                             Re~ApriJ,    2003
                                                                                                                                                                               rmrllt1alne<:J by
Contractor pursuant to Para~ 13./fIt fs judicially determined that the monetary limits of lnstm~nce required hereunch!r or of the 111cfemnltles voluntarfly li$SU!Tled under

Subpamilfaph 14.9 (Wfllch c~r and opemor hereby agree will be supported                            eitfleT   by avalfable liab!Rty IMurnlC"e, tltld« mncll the lnstlfef h.as no right of
subrogation against !he iflfkmqfte.es, or vctuntarily self-lnsl.U'f1f!, in       part or wflole} &ceed the maximum llmltS permitted under appfk:.abll!!           .raw, It l$ agreed that said
Insurance requirements or lndemnftles shaft automatically be amended to conform to the maximum monetary llmlt!i permitted um:ter such law.
      14.10 Uabflfty forWifd Wetl; Opeiafor $ha!l be liable for the cost of regaining controJotanywlklwell.as well as for cost offemOval of any debris and cost of property
remediation ood restorat!Of1, am:/ Opemtor shall releztse, protect, tkfend and indemnify Contractor and ItS suppliers; COil'tnlctors am:/ ~ctoos of any tier from

and tlgaftlst any lfabi/Tty for such cost
      14.11 Pollution or Contamination: HotwtthStanding anything to the contrary contained herein, except the provisions of Paragraphs 10 and 12.                                         It Is
understood and agreed by and between Contractor and Operator that the responsibility for pollution or comaminatlon sh;lll b& as follows:

      (a) ContnfC!or shall assume all responsltllifty for, Including cont.rol and retnCYat of. and shall protect, deleild and Indemnify Oper.ttor from and against                  an dalrns,
demand$ and call$e$ of act!OI'I of ~VIll)' kind and c~ <Ufslng frnm pollution or CO!IfamiMtloo, wf1lch orfginak!s above ~ swtace. of the land or ~frnm spllis of

(/Hl/$, lubricants, motor Oil$, pipe ~        pafnts, solvent$,   ~       bilge att<J gamage, &Copt unavoidable paitution from reserve pits, Wholly In COntr«<:tor's possession
and control and directly associated with Contmctor's equipment tmdfacliltlrn.
      (IJ) OperatQr $hi!/~ assutJt4 aft respollSfbi/Jty   tor. Including control and removat of, and$1!itllprotect, defebd aDd Indemnify Contractor and its suppllets, cootractlllS. Ntd
subcot1ltactors of <my tiw' from am:/ against. till claims, demands, and cau:ses of action of ovory kind :;md chamcter ariSing directly or lndlrectfy from till other
palfutlon or contamination which may occur during ttla conduct of openrt/Oil$ ~under, frlciUdfng, but not 1imltJ!d to. that which may result from                               ffre, blowout.
                                                  .                                                            .                                                         .
a1Jtedng, soopage or any ather uncontrofTed flow of oJI, 93S, water or other substance, as well as the IJ$t! or dlsposftfon cf a11 drilling flulds, incluri1ng,. but not llmlted to, oil
amulsforl, 011 base or r:hemfcally treated drll1lng fluids, contaminated cuttings or cavtngs, lost elrcufatlon and fl$h recovery materials and flllfds. Operator sh8H ralease
Contlactorand Its suppliers, contnctors and sutx:antractors ofany tier O(;my fi81Jifrtyforthe ~

      (cf ln the event a third parly commits an act or omission which resufts In poflutfon or t:f>$iminat/on for l+M:h ~ Contractor or Operator, for IKJom 5uch
party Is performlti!J ~         Is   fWd to bf11egatly liablo, the responsibfl/ty therefor shaU be consldere<f. as between Contrador ood Opemtor, to be tM $llnle as if the

party for whom the wolk w.u p<:lformed ltad pedOrmed the same and aJf of the obl/g3tlon$ rw;pectJng prote<:tfun, defense,. indemtlfty and Hm/QtJon of l'VSpOI'IS/bilfty
and liability, as set ff>rth in (a} and (b) above, shalt be specifically applied.

      1<1. 12 Cons~Mfuent/at Danmges: Subject to at~dwfthout affecting til& provfslons of this Contractl"tlgNdlngthe payment right$ Ntd obllfPiions oftM parties or the risk

of Toss, release am:! Indemnity n"ght:t; :andobilg81Jons of thO: parties, eact1 party shan itt all~~ respot!$1~ for and hold harm/e$$ Md Indemnify the other party flim! and
against its own speclai, Indirect or consequential damage&, and the ~ agree that $pi!C(al, lrldlred cr COilSequenti<# damageS shalt biJ deem«! to JndUde, Wfthout
llmftiltion, the folfowfng: /o$S of profit or revenue; costs and expense$ resulting from ~ Interruptions; /o$S of or delay In prodUction; /o$S of or damage to the

Teasehold; loss of or tklay in dtffHng or opel3(}ng rights; cost of or loss oltJSe of property, equlpmM(, ~and ~Ices, it/Citlditrg without tlmJt.ttfOI'I ~ prov{ded by

contr.Jctots or subcontractors of every tier 01 by third partie$. Ope/a tor shall ;d all tfmes be responsible for :and hold harmless and (fldcmnl(y COf1tractor and Its $tlppli¥s,
conttactor$ :and sl.lbctlntractors of anytferfrom Btld against all cfalms, demands and causes of action of evt!l)' kind Blld clwac:ter In co~ with 5UCh spedai.lndfrec1
or consequential~ suffered by Opetator's ~ co-ventun:n;, co-lessoos, farmors, farmees, parlnl!(S :andjoint oWfH!I"S.

      U.131ndemnity Obligation: Except as otherwfs& expressly tftltlte<l in this COtltract, f( Is the lnfl#lt of parties hereto that all releases, fttdemnlty obligations

11ndfor flabflltles assumed by such parties under terms of thfs Contract, Including, wfthout llmttatlon, Subparagraphs .f.9 and 6.3(c}, Paragraphs 10 and 12, and

Subparagraphs 14.1 through 14.12 henwf, be                  without llmft and wfthout regard to the causa or causes thereof, lucllldlng, but not llmtted to, PfJI-iJl'lstlng
conditions, defect or ruin of premises or equipment, strict !lability, regulatory or mtutory liability, products /labUity, broch of representation or warranty

(tttpre$$ or lmpfiedJ, breach ()(duty (whether statufoly, contra.ctuBI or otmtwlse) any fil«Jry of tort. br6ach of contract. /a!Jlt. the negl/gooce of QJJy ~ or Character
(regard/e.s$ of wfled!er such negligence Is sote,jO/flt or~ actJve, pa$$ive or gross} of any p;trty or pllltles, Including the                    party ~g the beneift of the release,
Indemnity or assumption of 11Jbf1lty, or any other theory of legal liability. 1M lndemnJt!es, and reiea$e~S and assumption$ of liability extentkci by the pm/e~S hemtD un¢Jrthe.

provisions of Subparagraphs 4.!) and 6.3 and f>ilragtaphs 10, 12 and 14 shaltlnute to the benellt of such parties, their co-vMt~JreiS,                   co-lessees. }oint owners,       their

parent, holding am;l affiliated companies ;md the officers, d"treetors, stockholders, partners, managen;, representatives, employees, comsvltants,                                    agents,
servantS and Insurers of each. Except as otherwise provided here/11, such Indemnification and assumption$ of /lability shall not be deemed to create any lights
to Jndemn/ffcation in any person or entTty not a party to this Contra.c.t. either as e thfrd party beneficiary Qr by reason of any agreement of Indemnity betwGen

one of the parlles hereto and another person or entity not a party to tills Contract.

15.   AUDIT
      H any payment provided for hereunder Is made on 1he basis of Contractor's costs, Operator shall have 1he light to a\IQit Contractor's books and records relating
to such costs. Contractor agrees to maintain such books and recor(!s for a pertOII of two {2) years                 from the date such costs were incurred and to make such bo<Jl(s

and records readily available to Operator at any reasonable time or times within the period.
16.   NO WAIVER EXCEPT IN WRITING
      n Is fully understo<xl     <~nd   e(iree<;l 1hat none of 1he requiremenkl of thil; Conw«:t shaH be c;onsldered as waived by eilhet              p;:~rty   unless 1he same Is done in
writing, and 1hen only by the persons execuliog this Contract, or other duty authorized agent or r6J)resentalive of the party.
17.   FORCE MAJEURE
      Except as provl<led In 1his Paragraph 17 and wi1hout prej\.ldice: 10 the risk of (0$5, release and indemnity obligations under this Contract, eadl p;uty 10 !11ls Contract
shall be excused from complying wi1h the terms of 1hi5 Contract, except for lhe payment of monies Y<flen due. if and tor sa tong <os such compliance i'i hil'ldered or
prevented by a Force Majeure Event As U$00 in this C<lntract, "Force Majeure Event" includes: acts of God. action of the elements, wars (declared or undeclared},
Insurrection, revolutiOn, rebelliOns or civil strifa, plracy. eM! war or hos1ile ac1lon, terrorist acts, ri01S, strikes, differanc.es with workmen, acts or public enemks, federal or
state laws, rules, regulations dispositions or Olders: of any governmental authorilles having jurisdic1ion in the premises or of any other group, organization or informal
association (whether or not formally recogn!zad as a government). Inability to procure material, equipment, fuel or necessary labor In ltle open market. acute and unusual
labor or material. equipment or fuel sflortages, or any other causes (except financial) beyond the control of either party. Neitt!er Operator nor Contractor shan be raquiced
;~galnst its will to adjust any labor or similar disputes except in accordance with appiicable laW. In the event that either party hereto is rendered unable, wholly or in part, tJy
any of these causes to carry out Its obligation under this Conttact, it i5 agreed that sUd! party shall give notice and details of Force Majeure in Ylriling to lhe other party as
Pfomptly as possible afler its occurrence. In such cases. th& obligations of the party gilling 1he notice shalt be suspended during the continuance of any inability $0 caused
except that Operator shall be obligated to pay to Contractor the F01ce Majeure Rate PfOYided for in Subparagraph 4.6 above.
18.   GOVERNlNG LAW:
      This COOtTact !$hall be construed, governed, Interpreted, ti!lforce<l and litigated, and the relatiollS between !he parties deb!rmlned In aoo:m:lanca with the la~


                               Copyright~ 2003
                                                 ru S. D<l)WOlk Conlr.tet • PJ11e 5)
                                                  International Association of Drilling Contractors
                                                                                                                                          Form provided by Forms 00-A-Oisk
                                                                                                                                         (214} 340-9429 • FormsOnADisk com
                                                                                                                                                                                               \~Y::,S~
                                                                                                                                                                      NCPS 00094
                                                       --·~·-···~····----·           ..   ---................. ---··---·---·-· .. ···----·   ·---·-·········~---·   . -···--··-·- ·····--··--.--····-··-




 19.     INFORMATION CONFIDENTIAl..:

         Upon written request by Operator, information obtained by Conltactor in the conduct of drilling operations on this well, Including, but not limited fo. depth,
 fonna1Jons penetrated, 1he results. of CO!ing, testing ami surveying, shall be considered confidential and shall tl01 be divulge<! by Contractor or its employees. to
 any person. firm, or cotpO(a11on otl'IE!rthan Operator's designated representatives.
 20.     SUBCONTRACTS:
         Either party may employ other contractors to perform any of the operations or services to be provided or performed by it according to Emibi( •A".
 21.     ATIORNEY'SFEt:S

         If this Contract Is placed In the hands of <JO attorney ror collection of any sums due hereunder, or sui! is brought on same. or sums due hereunder ate colfected
tllrou1Jh bankrvptt:y or arbitration proceedings. then the prevallir~g party snail be .Willed to re<»ver reasonable attorney's rees and costs.
 22.     Cl..AIMS AND LIENS:

         Contractor   agrees !o pay all valid dairns tor labor, material,      se~.            and supplies to be furnished   by Contractor lle1'eunder, and agrees to allow no lien by
such third pqrties to be fixe<! upon tt1e tease, the well, or other property of the Operator or the land upon WhiCh said well Is located.
23,      ASSIGNMENT:

         Neither party may ass.ign !his Contract without the prtor written consent .of the other. and prompt notice of any such rnten~ to assign shall be gtveo to the
otl\er party. In the evenl of such assignmant the assigning party shall remain liable to the other party as a guarantor of the performance by 1he assignee of the
terms of 1hls Conlt<~ct. If any assignment is made that matetially alters Contractor's financial burden, Conlractor's compensation sllatl be adjusted to give effect
to at~y increase or deaease In Contractor's operating costs.
24.      NOTICES AND Pl..ACE OF PAYMENT:

         Notices, reports,   <~nd   other communiCations required or permitted by this COntract to be given            or   sent by one party to the other shall be delivered by hand,
mailed. digitally transmitted or telecople<l to the address hereinabove shovm. All sums p;)yable hereunder to Contractor shall be payable at its address hereinabove shown
unless 01herwise specified heteln.
25.      CONTINUiriG OBUGA110NS:

         Notwiths1andlng the termination of thi$ Contract. the parties shall continue to be bound by the provisions or this Contract that reasonably require some action or
forbearance al'ler sudl termination.
26.      ENTIRE AGREEMENT;
       This Contract constitutes the fult understanding of the partie&, and a complete an(! exclusive slqlement of the terms of their agreemer~t. and ShaH exclusively
eontrnl and govern all work petformed          heteunder, All represenfatloru;, offers, and undertakings of the paroes made prior to the effective date hereof, whether oral
or in wnting, are merg~ herein, and            no   other contracts, agrflement$ or work orders, execmed prior to the execution of this Contracl, shall in any way modify.
amend, alter or change any of lhe terms or conditions set out hetein.
27.    SPECIAL PROVISIONS:

27.1 Exhibit "C"- Contras:torJ Speelal Provisions Is attaehed hereto and made a part M!'eof.

       ~~ ~':u:i~~~ ~~:r?r~~~n:. ~~~ ~~:;.r:s'= ~"~~~~~~$, ~ ru~~J~~~~~~~:::=~e~::a~ec:~~~=n~:rw!ei:u~~~a~~~::
27 2
  '
       waives any objection that such courtS a"' an Improper or Inconvenient venoo or forum for !Such dllspu!es.

27.3   ~~!1 fat~f~~(:0~~;;,:gar:cfn.n~a:'~~3:~~~~~m~~~~;:a~ ~=t'orc:!fr~~f~o~t:1~r ~~~~"fat~ "h• "-"~r ':a;~clement weather, lack of
21.4 Epoell WeU Services:, Inc. ("Epodl"}, an affiliate of Contracblr, shall Invoice Operator, and Operator shall pay Epoe..
     rental of th~ Epoch Rig Watch system.
                                                                                                                                                        per day   (spud to   relea~) for


       The Epoch Rig Watch System equipment Includes the fOllowing: Driller's workstation, Companyman compursr workstation, Tootpusher computer
       work~;~tation, depth/bit tracking l!ystem, hOok loadlbft weight rotary torque, rot.lry RPM, pump pmsure, pump lrtroke counters (2 JlUmps Included), prt
       volume probn {& probes Included with option. for 6 addlliilnaf prol>es), tnp tank vOlume probes <1 probe Included with option for 1 addllklnal probe), and
       return flOw paddle.




2S.    ACCEPTANCE OF CONTRACT:

       The fore~golng Contract, fncludfng the provfs.fons relatfng to Indemnity, release of liability and allocation of risk of Subpamgraphs 4.9 and 6.3(c),

P8ragraph$ 10 ;:nd 12, amt Subparagraphs 14.1 through 14.12, Is acknowledged, agreed to and accepted by Operator this                          ..l_3 day of $ ep              .zo_oo.




The foregoing Contract. .Including the provisions rafatlng              to Indemnity, rt!lease of liability and allor:<Jtlon of nsk of Subparagraph$ 4.9, 6.3(c), P<fngraprno
10 and 12, and Subparagraphs 14.1 throug/114.1Z,Is acknowledged, agreed to and accepted by Contractor thiS_£.___ day of                                      September         20...f/!L;

which fs the effectiVe date of this Contract, .subject to rig avaflabflity, and subject to all of its terms and prov/.sfons, with the understanding that It Wilt not be

binding upon OperatOl' until Opetator has noted its acceptance, and with the further understanding that unless said Contract fs thus executed by Operator

Wlthfn        seven m        days of the above date Contntetor shall be In no manner bound by Jts $ignature thereto.




                                                 (U.S. Daywark Ccntrac:t • Page 6)
                              Copyright Q 2003 lntemalional Associa!ioo ot Drilling ContractOI'$
                                                                                                                                         form provided by Forms On·A-Disk
                                                                                                                                        (214) 340·9429 • FormsOnADisk.mm
                                                                                                                                                                                 ~~
                                                                                                                                                                                  1\J"
                                                                                                                                                                                             \\

                                                                                                                                                                  NCPS 0                48
                                                                                         EXHIBIT"A"
To Oaywork Contract dated              S~totember 22              , 20 _ruL_

Operator     Penn Virginia Oil & Gas. tP                                                              Contractor       Nabors Drilling USA. LP

Well Name and Number            To be advised by Operator


                                                                             SPECIFICATIONS ANO SPECIAl PROVISIONS

i. CASING PROGRAM (See Paragraph 7}

                            Hole                      Casing                        Weight                         Grade                 Approximate                      Walt on Cement
                            Sl2.e                          Size                                                                          Settlng~pth                           Time

                                                                                                                                       _ _ _ _ _ ft.
  Conductor
  Surface
                                         in.
                                         in.
                                                                       in.
                                                                       in.
                                                                                                  lbsltt
                                                                                                  lbsltt                               _ _ _ _ _ _ ft.                   -----       Ius
                                                                                                                                                                         _ _ _ _ _ _ hrs

  Protection                             if!.                          in.                        lbslft.                              _ _ _ _ _ _ ft.                               hrs
                                         in.                           io.
                                                                                                                                                                         ------
                                                                                                                                                                         _ _ _ _ _ _ hrs
                                                                                                  lbslfi
                                                                                                                                       --~---ft.
  Production                             in.
                                         in.
                                                                       in.                        lbslft                               _ _ _ _ _ It
                                                                                                                                       _ _ _ _ _ _ It                    ------                 hi'S
  Liner                                                                in.                        (bslft.
                                                                                                                                       _ _ _ _ _ _ ft.                   ------                 hrs
                                        in.

2. MVD CONTROL PROGRAM (See Subparagraph 8.2)
                                                                       in.                        lbslt!.
                                                                                                                                                                         ------                hr$



                   Depth Interval
                         {ft)
                                                                                                               Weight                                                        Water loss
                                                                                                              (lbs./gal.)                                                        (~)
          from                            To                                 ~Mud




Olhermud $pecllications: _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __




3. INSURANCE (See Paragraph 13)
      3.1    Adequate WQO(ers' Compensation Insurance corn plying wilh State laws applicable or Employers' Liability Insurance wi1h limits of$                           one !1} million
             covering all of Contractor's employees worl<ing under this Contract.
      3.2    Commercial {or Comprehensive} General Liability Insurance, including conlractual obligations as respeds this Conlract and proper coverage                                       tor     all
             other obligations assumed in this Contract The limilshall be $_-"'on...,e...,!u,1lum"'i"-"lll~on!!-_ _ _ _ _ combined single limit per occurrence for BOOily Injury and
             Property Damage.
     3.3     Automobile Public Uability Insurance With limit$ of;               on' f1! million             for the death or Injury of each person and$     ont t1l million
      accident; and Automobile Public Liability Property Damage Insurance with Umlts of$                             one 11) ml!ll9n              ror each acddent.
             ~-QP!iftltillll&                                        GGA!Iaafar 6f'laii-Cal'l)' iA a!l~litieR 1~-StatWll)• '"'GI'!<9ffi G911lflBAsatloo-lllSUf3A'-El, ilRQil~GI!lSR!G
                                                                                                                                         1
      3.4                                   are   6\'ef.   "rater,                                                                                                                         GG'rt!RA!J
      Ua~li!y II Aller ~SREIR!Ffl6A'&           & Hafi>E>r Werke~· GG!'RpeRsatiGA AGt aRG Mafitif!le liallilill! iRGIIIGiR!I maiRI6RBAG8 aRil G\11'8 ill11if!lits ef $
      ~eatiHlf.·in)u!)'W QRe ~RI'JR 9A!~-$.                                                    far any GAB aGGiGeFit
      3.$    Other Insurance:       Exens !lability lnsuraf!C9 In tft9 11mount of $4 million dollars On excess of 3.1. 3.2 and 3.3} OptratOr will purci\AAe OEE Insurance
      In an amount not less. than $1G million dollars Insuring the llabllltle! assumed by the Operator ui\OOr this Contract.


4. EQUIPMENT, MATERIALS AND SERVICES TO BE FURNISHED BY CONTRACTOR:
     The maChinery, equipment. toOls, materials, supplies, illStruments, services and labor hereinafter listed, including any transportation required for such
items, shall be provided at the well location at the expense of Contractor vnless otherwise noted by this Contract.
      4.1    Drilling Rlg •subject to avallabutty
      Complete drilllng rig, designated by Contractor as its Rig No.                       71 r                 the major Items of equipment being:
Dra\W/Orks: Make and Model             Per rlq Inventory attached hernto and made a part hereof
Engines: Make, Model, and H.P.
            No. on Rig _______________________________________________________________________________
Pumps: No, i Make, Size, and Power __________________________________________________
          No.2 Make. Size, and Power _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __
Mud Mixing Pvmp: Make. Size. MO Power ______________________________________________

Boilers: Number, M<Jk.e, H.P. and W.P. - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Oerricl:. or Mast Make. Size, and Capacity

Substru~ure:   Siza and Capacity _ _ _ _ _ _ _ _                             ,------'--~--------..,.._.                                      _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _...,.-

Rotazy Drive: T y p e - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
Orih Pipe; Size   4 ·f12n  ln. weights and orades as necessary ro maintain 100.000 lbs ovemufl 1\.: SiZ&; -~---in.------ ft.
Drill Collars: Number and Size          25-& 'A'' fnomlnafl· 6-8" !nominal!




                                       (U.S. Dayworl< Conttar;t. • 'fixhltJif A• ·Page 1)
                            Copyright@ 2003 International Association of Drilling Contractors
                                                                                                                                                Form provided by Forms On·A·Oisk
                                                                                                                                               (214) 340·9429 • FormsOnADisk.eom
                                                                                                                                                                                             2'r;:;\jS~
                                                                                                                                                                                               . '
                                                                                                                                                                           NCPS 000
.·
     Blowout Preventers: ------------------------------~---------
                    Size                                Serles or Test Pr.                            Make&Model                                       Number




       B.O.P. Closing Unit:
       B.O.?, Accumulator:

           4.2    Derrick timbers.
           4~     Normal strings of drill pipe and drill ¢¢!Iars spealied above.
           4.4    Conventional drift indiCator.
           4.5    Circulalillll mud pits.
           4.6-   N~ssary pipe raCks and rigging up material.
           4.7    t>kifmal.~ aRtl               Gllemlsals.
           4.8    Shale Shaker.
           4.9
           4.10 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
           4.11 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
           4.12 -------------~---------------------------
           4.13 - . . , - - - - - - - - - - - · - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
           ~14  ------------------------------------------------------
           4.15 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
           4.18   -----------~----------------------~------
           4.17 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
     5. EQUIPMENT, MATERIALS AND SERVICES TO BE FURNISHED BY OPERATOR:
          ihe machine!)', equipment, tools. materials, supplies, Instruments. se~s and IabOt hereinafter listed, induding any transportation required for sUCh items, .$1\all be
     provided at the well location at ltle expense or Operator unl$ss otheiWise noted by thls Contract

           5.1 Furnish al\d maintain adequate roadWay <tndlor can;;~! to location. right-of-way, including rights-of-way fOf fuel and water lines, river crossings. highway
               crossfngs, gates and cattle guards.
          5.2  Stake location, clear lllld grade locaflon. and provide turnaround, ineluding surfacing when necessal)'.
          5.3  Test tanks with pipe and fittings.
          5.4  Mud storage tanks With pipe and fittings.
          5.6  Separator with pipe and fittings.
          $.6  Labor and !Tl<llefillls to conned and disconnect 1\'\ud tank, test tank. and mud 9'!S separator.
          5.7  Labor to disconnect and Clean test tanks and mud gas sep;.~tator.
          5.8  Drilling mud, chemicals, lost circulation materials and other additives.
          5.9 Pipe and connections tot oil ein.:ulaffng lines.
          5.10 LabOr to lay. bory end recover oil cin.:ulaling fines.
          5.11 Drilling bits, reamer$, reamer ~;Utters, stabfti.l:ers and special tools.
          5.12 Contract fishing tool services and tool rental.
          5.13 Wire line core bits or heads. core barrels and wire line core catchers If required.
          5.14 Conventional core bits. core catchers and COte barrels.
          5.15 Diamond core barrel with head.
          5.16 Cement and cementing service.
          5.1 T Eleetr>Cal wlreHne fogging s<31'Vices.
          5.18 Directional. caliper. or other special services.
          S.19 Gun or jet perforating serviCes.
          5.20 Explosives and shQoting devices.
          5.21 Formation testing, hydraulic fracturing, acldizlng and other related services.
          5.:22 Equipment fOf drill stem testlng.
          5.23 Mod JoQging services.
          5.24 Sidewall coring    service.
          5.25 Welding service ror welding bottom joints of casing. guide shoe, float shoe, float collar and in connection wilh installing of wen head equipment If required.
          5.2& Casing, tubing,linefS, screen,lloat collars, guide and float shOes and associated equipment
          5.27 C<)Siog scratchers and centralizers.
          5.28 Well head connections and all equipment to be Installed in or on well or on the premises for use in connection with testing, completion and operation of well.
          5.29 Speci<ll or added storage for mud and chemicals.
          5.30.Casinghead, APf series, to conform to that shown (or the blO'.vout preventers specified in Subparagraph 4.1 above.
          5.31 Blowout preventertestlng packoff and testing services.
          5.32 Replacement of BOP rubbers, e~nts and s~~;fs, if requir*. after i11!tlal test
          5.33 Casing Thread Protectors and Casing lubrican1S.
          6.34 H~ trainif1ll and equipment a$ ne~ssaiY or aa required by law.
          5.35 Site septic systems.
          5.3G        Oltehtng around rig and location,
          5.37        Third party SOP testing service

          5.36 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
          5.39 ---------------------------------~-----
          5.~     ------------------------------------------------------------------
          5.41 ----------------------------------------------------------------------------
          5,42 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
                                    ·~-----------------------------------------------­
          5A3 - - - - - - - - - - - - - - - - - - - - -
          ~«------------------------------------------------------------·-----------
          5.45 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
          5.45    -------------------------------------------------------------~---
          5.41    -----------------------------------------------~-
          ~48     --------------------------·--------------------------------------------------
          5.~     ---------------------------------------------------------------------------
          s.~ -----------------------------------------------------------------


                                             (U.S. Dayworl; Contract· 'Exllibit A'·PiJge 2)
                                Copyright e 2003 lntemational Association of Drilling Contractors
                                                                                                                                    Form provkled by Forms On-A·Disk
                                                                                                                                   (214) 340-9429 • F'ormsOnADisl;.com
                                                                                                                                                                              ~~~~
                                                                                                                                                                                oV
                                                                                                                                                              NCPS 0             50
                                                                                                                                                                                                                                                                                  R.e>Med April, 2003
  6.     EQUIPMEN'r, MATERIALS AND SERVICES "rOBE FURNISHED BY OestGNATED PARTY:
        The machinery. equipment. tools, materials. supplies. instruments, services, and labor listed as 1he following numbered items, including any 1ransportati0n

, requiree for such items unless olhefwise spedtied, shall be provided at the well focation and at 1he ~ose of the party hereto as designate<:! by a~ X mark in the
  appropriate column.
                                                                                                                                                                                                                                                To B& Provided By and
                                                                                                                                                                                                                                                  At The Expense Of
                                                                           Item                                                                                                                                                      O~rator                             Contmctor
        6.1      Cellar and Runways ......- .........................................................- ....................... ..                                                                                                       X
        $.2      Ditches and sumps ..............................................................................................                                                                                                       X
        6.3      Fuel (located at                                                        .... ,.......................................... ..                                                                                            X
        &.4     Fuel lines (leng1h               cf rig only                           L .............................. w._ ......... . .                                                                                                                                    X
        6,5     Water at source, inclUding required permits ........................................................                                                                                                                    X
        6.6     Water well, including fe<!ulred permits ....................,..........................................                                                                                                                 X
        &.7     Water lines, indudlng required permits .......................,............................... ,.......                                                                                                                 X
        6.8     Water storage tanks                                         capacity (Per rig inventory) ............... .                                                                                                                                                   X
        6.9     Potat>ie water and bottled wtru!r ........................................................................                                                                                                              X
       6.10     t..abOr to operate water well or water pump (Rig C:lliW only) ...............................                                                                                                                                                                X
       6.11     Maintenance of water well. if required .................................................................                                                                                                                X
       6.12     Water Pump ....................................................................................................... .                                                                                                    X
       6.1~     Fuel for water pump .............................................................................................                                                                                                       X
       $.14     Mats for engines and boilers, or motors and mod pumps ..............................,.. ..                                                                                                                              X
       6.15     Tr<lnsportatlon of Contractots property:
                Move ln ................................................~ ................:..............................................                                                                                        S9e Paragtapll4.1                                                          I
                foilove out..............................................................................................................                                                                                        See Paragraph 4.2                                                          r
       6.16     Materials for "boxing in" rig and damclc ...............................................................                                                                                                                NIA                                 NIA
                                                                                                                                                                                                                                                                                                        /
                                                                                                                                                                                                                                                                                                            I
       6.17     Special strings of drill pipe and drill collars as follows:
                Any requlred                                                                                                                                                                                                            X


       6.18     Kelly joints. subs, elevators, tongs, sUps and BOP rams fOr use with special
                driUplp& ...............................................................................................................                                                                                                X
       6.11!    Drill pipe protectors for Kelly joint anr;! each jolnt
                of <lnll pipe running inside of Surface Casing as required,
                for use With r:iQrmal st.flngs of drill pipe ...................................................,........... .                                                                                                          X
       Ut>      Drill pipe protectors for Kelly joint and drill pipe running
                inside of Protection Casing..................................................................................                                                                                                           X
       6.2.1    Rate of penetration rec:ording device (Epoch (t\llctronlc) ..................................                                                                                                                                                                X
       6.22     Extra labor for running and cementlng casing (Casing crews) .......................... ..                                                                                                                               X
       6.23     Casing toots .........................................................................................................                                                                                                  X
       6.24     Power casing tongs ..................,.........................................................................                                                                                                         X
       6.25     Laydown and pickup ma<:hine .............................................................................
       6.26     Tubing toots ........................................................................................................ .                                                                                                 X
       6.27     Povrer1ubingtong ................................................................................................                                                                                                       X
       6.28     Crew Boat&. NuMber                                          .....................................................                                                                                                      NJA                                  N/A
       6.29     Service Barge ......................................................................................................                                                                                                   N!A                                  N/A
       6.30     Service Tug Boat .....................,...........................................................................                                                                                                     NIA                                  N/A
       6.31     Ral Hole ............................................................................................................ ..                                                                                                X
       G.al     Mouse Hole .....................................................................................,.................. .                                                                                                   X
       &.33     Reserve Pits ..................... ,., ................................................................................                                                                                                 X
       6.34     Upper Kelty Cock.................................................................................................                                                                                                                                            X
       6.3S     Lower Kel!yVatve ................................................................................................                                                                                                                                            X
       6.36'    Drill Pipe Safety Valve ......................................................................................,..                                                                                                                                            X
       6.37     lnsfda Blowout Preventer................................................................................,... .                                                                                                                                               X
       6.38     Drilling hole ror or driving for conductor pipe .......................................................                                                                                                                 X
       6.39     Charges, cost of bonds for public roads ..............................................................                                                                                                                  X
       6.40     Portable fOilet .....................................................................................................                                                                                                   X
       6.41     Trash Receptacle ................................................................................................                                                                                                       X
       6.42     l.iAeaf.Motlon-Shale Shaker (f'er rig Inventory} ............................................... .                                                                                                                                                           X
       &.43     Shale Shaker Screens..... ,. ..................................................................................                                                                                                         X
       6.44     Mud Cleaner ........................................................................................................                                                                                                    X
       6.45     Mu<I!Gas Separator .............................................................................................                                                                                                        X
       6.4&     Desander., .............................., ........................................................................,...                                                                                                                                      X
       6.47     Desitter ................................................................................................................                                                                                                                                    X
       6.43     Degasser..............................................................................................,............. .                                                                                                  X
       6.49     C®trifoge .............................., .............................................................................                                                                                                 X
       6.50     Rotating Head ....................................................................................................                                                                                                      X
       6.51     Rotating Head RvbOers .......................................................................................                                                                                                           X
       6.52     1-iydraulit; Adjustable Choke ................................................................................                                                                                                          X
       6.53     Pit Volume Totalizer ......           w . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. .          X
       6-.5-4   Communication, type         {Cellular phone for rlg use only)                                                                                                                                                                                                X
       6.55     Forklift, capacity _ _ _ _ _ _ _ _ _ _ _ _ _ __                                                                                                                                                                         X
       $,56     Corrosion lnhlbitorforprotec!ingdriilstring .........................................................                                                                                                                   X
       6.57
       6.53
       6.59
       &.GO




                                                       (U.S. DsY\>O((f Contr~t- '&h.'Ot. A• • Pllge 3}
                                   Copyright It> 2003 International Assoclafloo of DrilHng Contractors
                                                                                                                                                                                                                                                     form provided by Forms On-A·Disk
                                                                                                                                                                                                                                                     (214} 340-9429 • FormsOnADisk.com
                                                                                                                                                                                                                                                                                               ~~\j~~
                                                                                                                                                                                                                                                                           NCPS 00095
                                                                                                           Revised April, 2003

7.   OTHER PROVISIONS:




                                                                                                       /




                                                                                   /
                                                                                       /
                                                                                           /
                                                                                               I
                                                                                                   I
                                                                               /




                                                                      I




                              (U.S. D.3yworl: Contract- 'exhibit A• ·Page 4)
                  Copyright e 2003 International Association of Orilting Contractors
                                                                                                                                                ReWs«< Apiif, 2003

                                                                                           EXHI61T"6"
                                                                                (See Subparagraph 8.3}

The following clauses, when required by taw, are incorporated in 1he Contract by reference as if fully set out:
(1)         The Equal Opportunity Clause prescribed in 41 CFR 60-1.4.
(2)         ~Affirmative Action Clause prescribed in 41 CFR 60-250.4 regarding veterans and veterans of the Vietnam era.
(3)        The Affirmative Action Clause for handicapped workers prescribed In 41 CFR 60-741.4.
(4)         The Certification of Compliance with Environmental laws prescribed in 40 CFR 15.20.




                                       (U.S. Oaywork Contract-   •ex/lib{( a·- Page   1)                              Form provided by Forms On-A-Disk
                          COpyright Q 2003 International Association of Drilling COntractors                         (2t4) 340-9429. Formso~~pcgn
                                                                                                                                                      000
                                                  EXHIBtT«C"

                                   CONTRACTORS SPECIAL PROVISIONS

1.    Contractor shall furnish initial tested annular preventer element. If the element is damaged due to destructive
      elements introduced to the mud, stripping, or excessive testing, the Operator agrees to furnish a new element

2.    Chemical Additives to the mud for preventing oxidation of the drill string and hydrogen sulfide scavengirtg
      chemicals to treat the mud or drilling fluid as necessary to remove all traces of H2S and to control oxygen
      corrosion to be furnished by the Operator.

3.    Operator shall furnish all labor, equipment and matertals to clean rig after use of oit base mud and/or completion
      fluid.

4.    Extra cost to rig up for drilling with oil base mud including, but not limited to, the cost of pit cove~. steam
      cleaners. drip pans, mud vacs and cleaning materials shall be at Operator's expense.

5.    Initial inspection of all Contractor's drill pipe, drill collars, kelly, kelly joints, valves, subs and HWDP shall be at
      Contractor's expense. All repairs, replacements and hauling for repairs will be at Contractor's expense. (The
      inspection will be to T.H. Hill, DS1, Category 3 or Its equivalent.)

6.    Subsequent inspections (including the inspection at the end of the job) of all drill pipe, drill collars, kelly, kelly
      joints, valves, subs and HWDP shall be at the Operator's expense. All repairs, replacements and hauling for
      repairs wm beat Operator's expense. (The inspection will be to T.H. Hill, OS1, Category 3 or its equivalent.)

7.    Operator shall furnish all screens tor shale shakers.

8.    Operator sh?ll furnish all potable water for Operator ard Contractor personneL

9.    Operator, Operator's representatives and Operators sub-contractors shall support Contractor's Safety Policies
      and Procedures in general and in particular, will (:amply with all Contractor's personal protective equipment
      requirements.

10.   Operator will be responsible for the provision and maintenance of any site septic systems.

11.   Contractor will provide only one size of mud pump liners. Any additional sizes required by Operator will be
      provided by Operator at Operator's cost.

12.   AU third party equipment required to nipple up/nipple down BOP equipment will be provided and paid for by
      Operator.

13.   The rates contained in this Contract are based on the rig inventory attached hereto. Any modification or addition
      to the rig requested by Operator will be at Operator's expense.

14.   Operator shall test BOP equipment at intervals as specified in federal, state or local regulations, API
      Recommended Practice or every twenty-one (21) days whichever interval is more stringent AU testing will be
      performed by an independent testing company provided and paid for by Operator.

15.   In all cases where Contractor's employees (including Contractor's direct. borrowed, special or statutory
      employees) are covered by the Louisiana Worker's Compensation Act, La. R. S. 23:1021 et seq., Operator and
      Contractor agree that all work and operations performed by Contractor and its employees pursuant to this
      agreement are an integral part of and are essential to the abl!ity of Operator to generate Operator's goods,
      products and services, Furthermore, Operator and Contractor agree that Operator is a statutory employer of
      Contractors employees for purposes of La. R. S. 23:1061 (A) {3). Notwithstanding Operator's status as a
      statutory employer or special employer (as defined in La. R S. 23:1031 (C)) of Contractors employees,
      Contractor shall remain primarily responsible for the payment of louisiana Worker's Compensation benefits to its
      employees, and shall not be entitled to seek contribution for any such payments from Operator.

16.   Operator, its parent, subsidiary and affiliated corporations, as well as the employees, officers and directors of
      each (collectively, •opera lor") is cognizant of the Nabors Dispute Resolution Program and wishes to become an
      Electing Entity, as defined in that Program. Accordingly, Operator and Nabors Industries, Inc. ('Nabors") hereby
      agree that Operator is an Electing Entity as to all Disputes between Operator and the present and former
      Employees and Applicants of Nabors pursuant to the Nabors Dispute Resolution Program as it currently exists
      and as may be amended from time to time. Jn the event the Program is amended, Nabors agrees to provide a
      copy of the amendment(s} to Operator. Operator may withdraw this election to participate in the Program at any
      time by giving notice of such withdrawal to Nabors, such revocation to be effective with respect to any claims not
      yet institute<;! as of the date of revocation. Operator unde~tands that it is bound by the terms of the Program With
      respect to all Disputes with Nabors employees, regardless of whether such Dispute is initiated by the employee or
      by Operator. Operator and Nabo~ acknowledge that the Program does not apply to disputes between Operator
      and Nabors and that the Program does not alter the terms of any indemnification agreement between them.

17.   In the event Operator elects to drill a substitute well it shall be Operator's obligation to advise Contractor in writing
      of such change.      Notwithstanding Operator's failure to notify Contractor of such change, the terms of this
      Contract shall apply to such substitute well as if such substitute well were the well specified in Paragraph 1 of the
      Contract.




                                                                                                                        Q
                                                                                               Exhibit_C_Ol_Texas_~W
                                                                                                       NCPS 000954
                                     NABORS DRILLING USA, LP
                                                 Rig No. 712
                                             Diesel Electric Land Rig
                                                                                                            fill~
DRAWWORKS:         Mid - Continent U712 EA, with an input rating of 1,000 horsepower, Baylor 6032 Dynamatic brake,
                   crown-o-matic and Foster catheads. Drum is lebus grooved for a 1 1/4" drilling line.

PRIMARY POWER:     Three caterpillar D-399 engines rated at 1,215 horsepower each, driving three KATO 1030 I0N
                   generators with a Ross Hill SCR system.

MAST:              Dreco 136' cantilever, 136' dear height x 21' base at floor. API static hook load of 571,000 lbs.   w/ 10
                   lines strung.

SUBSTRUCTURE:      Dreco "Slingshot", with a 22' floor height and 18' dear height under the rotary beams. Substructure is
                   designed for a 600,000 lbs. casing load simultaneous with a setback load of 350,000 lbs.

MUD PUMPS:         Two Gardner Denver PZ-10 triplex mud pumps rated at 1,300 horsepower each, driven by one 1000
                   horsepower GE 752 motors each.

MUD TANKS:         Two tank, 970 barrel system with a 75 barrel slugging compartment in the suction tank. Mud system is
                   equipped with stirring guns and clean out gates. Mud mixing and 10 HP mud agitators.

SOLIDS CONTROL:    12 cone desUter.
                   2 cone desander.
                   Two linear motion shale shakers.

WATER STORAGE:     One 500 barrel tank.

FUEL STORAGE:      One 12,000 gallon tank.

HOOK/BLOCK:        BJ 5350 Hook and National 545G Bloc~ both rated at 350 tons.

SWIVEL:            CE LB 400. 400 ton.

ROTARY:            GD 27 1/2".

ACCUMULATOR:       Koomey, 180 gallon, eight station, with an electric powered triplex pump, 1:\<vo air operated pumps,
                   regulating valves and eight station remote control.

BLOWOUT            One 11" x 5,000 psi, Annular, H2S Trim.
PREVENTERS:        One 11" x 5,000 psi, Single ram, H2S Trim.
                   One 11" x 5,000 psi, Double ram, H2S Trim.
                   One 3 1/8 x 5,000 psi, choke manifold, H2S Trim.

DRILL PIPE:        As per contract

DRILL COLLARS:     As per contract

MISC. EQUIPMENT:   Automatic driller                         One air hoist
                   Wirellne unit                             0-7 degree dlill indicator
                   4 Pen drilling recorder                   Lower Kelly valve
                   Upper Kelly valve                         Inside BOP
                   Full opening safety valve                 5 Y4" X 40' Hex Kelly
                   Vapor proof lighting system               Kelly spinner
                   Spinning wrench
 NOTE: This form contract is a suggested guide only and use of this form or any variation thereof shall be at the sole discretion and risk of the user parties. Users
 of the form contract or any portion or variation thereof are encouraged to seek the advice of counsel to ensure that their contract reflects the complete agreement
 of the parties and applicable law. The lntemational Association of Drilling Contractors disclaims any liability whatsoever for loss or damages which may result
 from use of the form contract or portions or variations thereof. Computer generated form, reproduced under license from lAD C.




               e
                                                                                                                                                              Revised April, 2003
                                                  INTERNATIONAL ASSOCIATION OF DRILLING CONTRACTORS
                                                              DRILLING BID PROPOSAL
                                                                       AND
                                                          DAYWORK DRILLING CONTRACT - U.S.

TO: NABORS DRILLING USA, LP

 Please submit bid on this drilling contract form for performing the work outlined below, upon the terms and for the consideration set forth, with the understanding that
If the bid is accepted by ------:-----:-:--:--:-:---:---:-:--:---:---:---:--:---:------=-:-::-----------::---
this instrument will constitute a Contract between us. Your bid should be mailed or delivered not later than P.M. on , 20 _ _
to the following address:


                                  THIS CONTRACT CONTAINS PROVISIONS RELATING TO INDEMNITY,
                                        RELEASE OF LIABILITY, AND ALLOCATION OF RISK-
                                            SEE PARAGRAPHS 4.9, 6.3(c), 10, 12, AND 14
This Contract is made and entered into on the date hereinafter set forth by and between the parties herein designated as ·operator' and ·contractor.•
     OPERATOR:        Penn Virginia MC Energy, LLC
      Address:           110 West 7tn, Suite 1800
                         Tulsa, Oklahoma 74119
      CONTRACTOR: NABORS DRILLING USA, LP
      Address:    515 W. Greens Road, Suite 1000
                         Houston, Texas 77067
IN CONSIDERATION of the mutual promises, conditions and agreements herein contained and the specifications and special provisions set forth in Exhibit 'A' and Exhibit
·s· attached hereto and made a part hereof (the ·contract"), Operator engages Contractor as an independent contractor to drill the hereinafter designated well or wells in
search of oil or gas on a Daywork Basis.


For purposes hereof. the term ·oaywork' or ·oaywork Basis' means Contractor shall furnish equipment, labor, and perform services as herein provided, for a specified sum
per day under the direction, supervision and control of Operator (inclusive of any employee, agent. consultant or subcontractor engaged by Operator to direct drilling
operations). When operating on        a Daywork Basis, Contractor shall be fully paid at the applicable rates of payment and assumes only the obligations and
1/abffltfes stated herein. except for such obligations and ffabllltles specifically assumed by Contractor, Operator shall be solely responsible and assumes
/lability for all consequences of operations by both parties while on a Daywork Basis, Including results and all other risks or llabflltfes Incurred In or Incident to
such operations.
1.




      1.1 Additional Well Locations or Areas:         None.
Locations described above are for well and Contract identification only and Contractor assumes no liability whatsoever for a proper survey or location stake on Operator's
lease.
2.    COMMENCEMENT DATE:


Gf
      Contractor agrees to use reasonable efforts to commence operations for the drilling of the well ~
   immediately following rig release from
sound location to accept Contractor's
                                                                                                                            Ga)4lf
                                                                     Contractor's current customer. If Operator does not provide a
                                                                      rig immediately following rig release from Contractor's current
                                                                                                                                                              ,-20       r
                                                                                                                                                                                          II
customer, Operator shall pay Contractor                              the Standby-. Time Rate from such rei s d te until the location is
read •         'Alii>tt- A-tJc. - ~•                                   b-tl           (.)/r •      "r,        -
3.    DEPTH:
     3.1 Well Depth: The well(s) shall be drilled to a depth of approximately                TBA               Feet,~---------------
fG!matlaR, " 11isAe"er is deejler, but the Contractor shall not be required hereunder to drill said well(s) below a maximum depth of - - - - - - - - feet, unless
Contractor and Operator mutually agree to drill to a greater depth. ** Not to exceed capacity of rig as described on the rig Inventory attached herein.
4.   DAYWORK RATES:
     Contractor shall be paid at the following rates for the work performed hereunder.
      4.1 Mobilization: Operator shall pay Contractor a ffieililizaliGR fee sf$                                     Gf a mobilization day rate of$
per day. This sum shall be due and payable in full at the time the rig is rigged up or positioned at the well site ready to spud. Mobilization shal'l-:in-cl-:-u..,-de-:- - - - - -
Move-in and rig up on the new well site.
*Plus actual costs of trucks, cranes and permits and                                              for man-lifts, light towers and string up services.
      4.2 Demobilization: Operator shall pay Contractor~




      1 3 Me •ing Rate· {)~JfiRg the !iffie the rig is iR !faRsit te ar ffeffi a erill site, ar be~ eaR erill sites, sommeRGiR!l OR - - - - - - - - -
-Gootfastmm-¢.$                                      Jl8F ~'<eRt)' klYF (24) RGUF say

      4.4 Operating Day Rate: For work perfonmed per twenty-four (24} hour day with                      Five (5)                      man crew the operating day rate shall be:
                     Depth Intervals
          From                               To                                  Without Drill Pipe                                      With Drill Pipe
           0                           Rig Release                                                                                  _ _ _ _ _ _ _ _ _ per day
                                                                        ---------per day                                            _ _ _ _ _ _ _ _ _ per_day
                                                                        - - - - - - - - - p e r d~y
                                                                        - - - - - - - - - p e r day
                                                                                                                                    _ _ _ _ _ _ _ _ _ per day                                  EXHIBIT
Using Operator's drill pipe $                   ___ per day. ..The Operating Day Rate includes a Canrig top drive.

The rate will begin when the drilling unit is rigged up at the drilling location, or positioned over the location during marine work, and ready to commence operations; and
cease when the rig is ready to be moved off the location.
                                                                                                                                                                                          I b
                                              (U.S. Daywork Contract- Page 1)
                            Copyright C> 2003 International Association of Drilling Contractors
                                                                                                                                 Form provided by Forms    On·A·Dls~~~S~·,)
                                                                                                                                (214) 340-9429 • FormsOnADisk.co      t\"             /
                                                                                                                                                          NCPS 0                S6
                                                                                                                                                                      Revised April, 2003

If under the above column 'With Drill Pipe" no rates are specified, the rate per twenty-four hour day when drill pipe is in use shall be the applicable rate specified in the
column "Without Drill Pipe" plus compensation for any drill pipe actually used at the rates specified below. computed on the basis of the maximum drill pipe in use at any
time during each twenty-four hour day.
                                                                           DRILL PIPE RATE PER 24·HOUR DAY
                                                                                                        Directional or
            Straight Hole                               Size                Grade                Uncontrollable Deviated Hole                         Size                  Grade
                 N/A              perft.                                                                      N/A               perft.
                 N/A              perft.                                                                      N/A               perft.
                 N/A              perft.                                                                      N/A               perft.

Directional or uncontrolled deviated hole will be deemed to exist when deviation exceeds -----degrees or when the change of angle exceeds - - - - -
degrees per one hundred feet.
      Drill pipe shall be considered in use not only when in actual use but also while it is being picked up or laid down. When drill pipe is standing in the derrick, it shall not
be considered in use, provided, however, that if Contractor furnishes special strings of drill pipe, drill collars, and handling tools as provided for in Exhibit "A", the same shall
be considered in use at all times when on location or until released by Operator. In no event shall fractions of an hour be considered in computing the amount of time drill
pipe is in use but such time shall be computed to the nearest hour, with thirty minutes or more being considered a full hour and less than thirty minutes not to be counted.                        ~

      4.5 Repair Time: In the event it is necessary to shut down Contractor's Ji9.)for bep~~irs, excluding routine rig servicing, Contractor shall j!;ll~~)
compensation at the applicable rate for such shut down time up to a maximum             of{<>~ ~urs ror any one rig repair job, but not to exceel';tf.;'"!,, f3Qi "ho!s                             I
of such ~mpensation for any calendar month. Thereafter, Co~tractor shall be compensated at a rate of$                      zero !0\         per twenty-four (24) hour day. Routin~ rig              I
servicing shall include, but not be limited to, cutting and slipping drilling fine, changing pump or swivel expendables, testing BOP equipment, lubricating rig, and

~~IT:~c~b;I~~:~S ::~t~;~tenance. When two !2) mud oumps are reouired to be used simultaneously the time soent changing expendable pump parts shal~
                                           100% of the Operating Day Rate
      4.6 Standby Time Rate: $               f              per twenty.four(24) day. Standby time shall be defined to include lime when the rig is shut down although in readiness
to begin or resume operations but Contractor is waiting on orders of Operator or on materials, services or other items to be furnished by Operator.
      4.7 Drilling Fluid Rates: When drilling fluids of a type and characteristic that increases Contractor's cost of performance hereunder, including, but not limited to,
oil-based mud or potassium chloride, are in use, Operator shall pay Contractor in addition to the operating rate specified above:
               (a)   $_      _ _ _ per man per day for Contractor's rig-site personnel.
               (b)   $_        __per day additional operating rate; and
               (c)  Cost of all labor, material and services plus       twentv·four !24!        hours operating rate to clean rig and related equipment.
                                        100% of the Operating Day Rate
      4.8      Force Majeure Rate: $ f                            per twenty-four (24) hour day for any continuous period that normal operations are suspended or cannot be
canried on due to conditions of Force Majeure as defined in Paragraph 17 hereof. It is, however, understood that subject to Subparagraph 6.3 below, Operator
can release the rig in accordance with Operator's right to direct stoppage of the work, effective when conditions will permit the rig to be moved from the location.
      4.9      Reimbursable Costs: Operator shall reimburse Contractor for the costs of material, equipment. work or services which are to be furnished by Operator as
provided for herein but which for convenience are actually furnished by Contractor at Operator's request, plus                fifteen 115! percent for such cost of handling. When,
at Operator's request and with Contractor's agreement, the Contractor furnishes or subcontracts for certain items or setvices which Operator is required herein
to provide, for purposes of the Indemnity and release provisions of this Contract, said Items or setvlces shall be deemed to be Operator furnished items or
setvlces. Any subcontractors so hired shall be deemed to be Operator's contractor, and Operator shall not be relieved of any of Its liabilities In connection
therewith. Notwithstanding the foregoing, Contractor shall not be obliged to purchase any Items on behalf of Operator.
      4.10 Revision In Rates: The rates and/or payments herein set forth due to Contractor from Operator shall be revised to reflect the change In costs If the costs of any
of the items hereinafter listed shall vary by more than            zero COl     percent from the costs thereof on the date of this Contract or by the same percent after the date of
any revision pursuant to this Subparagraph:
              (a}    Labor costs, including all benefits, of Contractor's personnel;
              (b)    Contractor's cost of insurance premiums;
              (c)    Contractor's cost of fuel, including all taxes and fees; the cost per gallon!MCF being $ NJA                 ; Operator shall provide all fuel.
              (d)    Contractor's cost of catering, when applicable;
              (e)    If Operator requires Contractor to increase or decrease the number of Contractor's personnel;
              (~GaRtFaGtar's east af sjlare jlafto aRil svpplies "'itA ~mliAIJ that sYGR spare paFts aAd sllpplies GGAslitute _ _ _ _ parseR! ef IRa GperaliA€1 rate
                     aRd tllal tile paRies sf:lallllse IRe IJ.S. 8\l;eau ef laear Stalistiss Oil Field ami Gas Fielll O;illiA!l MasRiAer, PraduGer PFise lmlex (Sel'ies 10 ..,Pif119102)
                     ta aeteFmiRe ta llat eKteRt a prise "ariaRse !las eeGilR'ell iA sale spare flaFts aRe s~Jpplies;
              {g}(f) If there is any change in legislation or regulations in the area in which Contractor is working or other unforeseen, unusual event that alters Contractor's
                     financial burden.
5.    TIME OF PAYMENT
      Payment is due by Operator to Contractor as follows:
      5.1 Payment for mobilization, drilling and other work performed at applicable rates, and all other applicable charges shall be due, upon presentation of invoice
therefor, upon completion of mobilization, demobilization, rig release or at the end of the month in which such work was pertormed or other charges are incurred, whichever
shall first occur. All invoices may be mailed to Operator at the address hereinabove shown, unless Operator does hereby designate that such Invoices shall be mailed as

follows:-----------------------------------------------
  5.2 Disputed Invoices and late Payment: Operator shall pay all invoices within thlrtv !30) days after receipt except that if Operator disputes an invoice
or any part thereof, Operator shall, within fifteen days after receipt of the invoice, notify Contractor of the   ~em   disputed. specifying the reason therefor, and payment of the
disputed Item may be withheld until settlement of the dispute, but timely payment shall be made of any undisputed portion. Any sums (including amounts ultimately paid
with respect to a disputed invoice) not paid within the above specified days shall bear interest at the rate of               1 112        percent or the maximum legal rate,
whichever is less, per month from the due date unUI paid. If Operator does not pay undisputed items within the above stated time, Contractor may suspend operations or
terminate this Contract as specified under Subparagraph 6.3.
6.    TERM:
      6.1     Duration of Contract: This Contract shall remain in full force and effect until drilling operations are completed on the          well~          specified In Paragraph
            er for a terrn af                                                                                                                                                                       I
                                                                                                                                                                                                    Ik
1 above,                                               ,.commencing on the date specified In Paragraph 2 above.                                                      .
      6.2     ElltenslaR ef+arm· Operater         rna~ extaA9 !Fie teFm eftflis GaAtraet for                 "ail(s) erfora flSRGd of

B) gi iAg Aelise to GeRtrastar at least             t);;_lf;pt';J;j/f/;)/!},t ~~eA ~~~~:/;. b'{.(-'1 ;;;;~..>(} h-9$ JlJ ~ 11;                                    /.il ;;, GQIAIJ ~
      6.3     EartyTermlnatlon:.t'..:yt.o~tc/JJ1i~ I we//~~ ff;JL;I/~1::; 6 f-l/,~1/J Sv~J-t:.4-1-/i:;>/Jt.()rv.t/f~ ~~~tJed
                                                                                                                        9
                                                                                                                             JA~.,S ,TUIIf.J
      (a)     By Either Party:      ~~ ~ivfn'gvj tv1Jtten ~~tice, either party may termmate this Contract when total loss or destruction of the rig, or a major breakdown With

                                                                                                                                                                              @
indefinite repair time necessitate stopping operations hereunder.


                                                   (U.S. Daywork Contract· Page 2)                                                     Form provided by Forms On-A-Disk
                                Copyright© 2003 International Association of Drilling Contractors                                     (214) 340·9429 • FormsOnAOisk.com              ~\~~.
                                                                                                                                                               NCPSO            ~57/
                                                                                                                                                                                        .........
                                                                                                                                                                                              Revis!ld April, 2003
       (b)     By Operator: Notwithstanding the provisions of Paragraph 3 with respect to the depth to be drilled, Operator shall have the right to direct the stoppage of the
work to be performed by Contractor hen!under at any time prior to reaching the specified depth, and even though Contractor has made no default hereunder. In auch event,
Operator shall reimburse Contractor as set f~ In Subparagraph 6.4 hereof.
       (c)     By Contractor: Notwithstanding .the provisions of Paragraph 3 with respect to the depth to be drilled, in the event Operator shall become Insolvent, or be
adjudicated a bankrupt, or fila, by way of petition or answer, a debtor's petition or other pleading seeking adjustment of Operator's debts, under any bankruptcy or debtor's
relief laws nrm or hereafter pravaillng, or if any sucti be filed against Operator, or in case a recaiver be appointed or Operator or Operator's property, or any part thereof, or
Operator's affairs be placad ln the hands of a Creditor's Committee, or, following three business days prior written notice to Operator if Operator does not pay Contractor
within the lime specified In Subparagraph 5.2 all undiSpUted items due and owing, Contractor may. at its option. (1) elect to terminate further performance of any work under
this Contract and Contractor's right to compehsallon shal.l be as set forth in Subparagraph 6.4 hereof, or {2} suspend operations until payment is made by Operator ln whiCh
event the standby llme rate contained. in Subparagraph 4.6 shall apply until payment is made by Operator and operations are resumed. In acMitlon                                      wContractor's rights
to suspend operations or terminate performance i.mder this Paragraph, Operator hereby expressly agrees to protect, defend and indemnify Contractor from and
against any claims, demands apd causes of action, Including all costs of cietense1 In favor of Operator, Operator's co-venturers, co-lesseeS and joint owners, or
any other parties arising out              of any drilling comtr(Jtments or obilgatJom; contained In any ltN,!Se, farmout agreement or other agreement. which may be affected
by such suspSTision of operationn; or termination of performance h.ereunder.
       6.4 ·Early Termination Compensation:
       (a)     Prior to Commencement: In the event Opamtor termjnates this Conlract prior to commencement of operations hereunder, Operator shall pay Contractor as
liquidated damages and not as a penalty a sum equalletl=!e .staRd~· lime ra~                      (Subparajjrapll-4,6~ a Jump                                                 sum of$          140 (!(!(!
       (b)     Prior to Spudding: If such termination occurs after commencement of operations but prior to the Gpudding of the well, Operator shall pay to Contractor the sum
or the following: (1) all expenses reasonably and. necessarily lncuired ar~d tQ be incurred by Contractor by reason of the Contract and by reason of the premature termination
olll)e work, in«ludiryg th,e expense of drilling or other mw rnem!)!jrs and superllislon directly asSigned to the rig; (2} ten percent (1 0%} of the amOtint of such reimbursable
ex!leflSBS; and (a) a slim cafcutated at. the standby !lme rate for an !lme from the date upon whiCh Contractor commences any operations hereunder down to such date
subsequent to the date of termination as wiD. alford Contramor rea&onabla time to dismantle its rig and equipment iJFG>4daEl, l=!go e '<!r, if Ulis GQFitrae!la for a taFfl'l ~ mare
Ulan ORO ' ·ell cr for a JlBFiQG ef. lima, Gperat9F shai+-pa~l)f, iR a~llilioR io Ule abe a. Ule FGrGe Jiajewre Rala. less Mj llRMOOGSal}' laber, fwm thai Gate
&UbseqlleRt ta lef*!liRa!IGA-upen "'llis!l GaRIR!Gtar llemfl!e . · · · ·· · ·                                                                            plus as l!guk!ated damages and ilot as
oenaltv a lump sum ooual to seven m days attha Standby Time Rate

       (c}     Subs&<~uent         to spudding: If such             .telmlr~aliOnQCCilrS   after the spudding of the well, Operator shall pay Contractor {1) the amount for all                        ;~ppllcable

rates and an other charges.           and. I"E!imbtirsements due to Cqntractor; •but . In no event shall such sum,                   exclusive of raimbursements due, be less than WOl.lld have
been earned for                    seven m                          days at the applicable rate 'Without Drill Pipe• and the actual amount due for drill pipe used In aciordance with the above
rates; or (2) at .the eleCtion ()f Contractor and In !leu of the !Qtegoing, Operator shall pay Contractor for au expenses reasonably and necassarlly Incurred and. to
be incurred by reason of this Contract,and.by re<~~ ohuch preJTl!itwe termination plus, a.a.J1;llu~mlf'p-&aullfmn-.. Olaf~$=========iljlf.Q~'i~Ele>llll~;-<,11REa~·"teoe>~'el!'rF,-lfif-IIIRmisKC;;<aH'!n!RiraaGtGt
is fer a lefffi at mara th!IJ:l      Qf18      nre!J er far a pefiell e'.iime1 0jleliaterel1aUpay. GaRiraelor, iR a~eillaR Ia ihe abe"e, IRa FORla J•ajeura Ra~ lass a~ ~Rne.Geissal)
Iaber fwm IRe £13W.af.lef!J11Aatlen;un~                                          as llqtildatl!d s!aniages and notas penalty       a lunip sum eoual to uven {7) days at the standby Time


7.     CASlNG PROGRAM
       Operator shall have the right to designate the points at which casing                       will be set and the manner qf setting, cementing end testing. Operator may modify the
casing program, howev!Jr, any sucp, modification                        Which materially Jricraa8es .Contractor's hazards or costs can only be made by muttJal .consent of Operator and
Contractor and upon ~greement as to the add!li~l compenl}ation to be paid Contractor as a result thereof.
8.     ORILUNG ME'rHOPS AND PRACTICES:
                                                                                           .                             .                          .
       8.1     .Contractor st)all maintain well control equipment in good condition at all times and shall use an reasonable means to prevent and control fires and blowouts arid
to protect the hole.
       8.2 .Subject to the terms. hereqf. and at Ope~tor's cost, at all times during the drilling of the well, Operator shall have the right to· control. the mud program,
and the drilling fluid must          tie       of a type and have characteristics and. be maintained by Contractor In accordance .with the specifications shown In Exhiblt "A".
       U . Each party heretq agrees to tomPiy with ali laWs, rules, and regulations of any fe<leral, state                                 Or   local governmental authority which are             now or may
become       applicable to that party's operations covered· by or arising out or the performance of this Contract. When required by law, the terms of Exhibit "B". shall
apply to this Contract. In the event any provision of this Contract is inconsistent with or contrary to any applicable fedeml, &tate or local law, rule or regulation,
said provision shall. be deeme<l to be modified .to the extent required .to comply with said law, rule                         or re{lulation,   and as so modified said provision and this Contract
shall continue in full force and effect.
       8.4     Cohtractor shall keep and fUrnish to Operator an aCcurate record of the work performed and formations drilled on the IADC·API Daily Drilling Report f'orin
or otherform acceptable to Operator. A legible copy of said form shall be furnished by Contractor to Operator.
       3.5     if requested by Operator,Contractor.stuill furnish Of,erator With a copy of delivery' tickets covering any lllatertal or suppl~s provided                                     by Operator and
received by Contractor.
9,     INGRESS, EGRESS, AND LOCATION:
       Operator hereby assigns to Contractor all necessary rights of Ingress and egress with respect to the tract on which the well Is to be located for the performance
by Contractor of all work contemptateo by this Contract. Should Coniractor be denied free access to the location for any reason not reasonably within Contractors
control, any time lost by ContractOr as a result ot such denial shall be pald for at the standby time rate. Operator agrees at all times to maintain the toad and location
                               .           .                    .   ~        .                                                                                                                     .
in such a condition. that will allow              fr~   access and movement to and from the drilling site in an ordinarily equipped highway type vehicle. tr Contractor Is required
to use bulldozers, tractors, four-wheel drJVe vehicles, or any other $pecialized transportation equipment for the movement of necassary personnel, machloory,
or equipment over access roads or on the drilling localion, Operator shall furnish the same at its expense and without cost to Contractor. The .actual cos.t of                                             r~pairs

to any transportation equipment furnished by Contractor or its personnel damaged as a result of improperly maintained access roads or location will be charged
to Operator. Operator shall reimburse Conlractor for all amounts reasonably expended by Contractor for repairs and/or reinforcement of roads, bridges and related
or similar faciliti~s (public and     pri~ate) required as a direct result of a rig move pursuant to performance hereunder. Operator shall be responsible for any costs asSociated
with leveling the rig because of locatiOn settling.
10.   SOUND LOCATION:
      Operator shall prepare a sound location adequate in size and cepab!e of property supporting the drilling rig, and shall be responsible for a casing and cementing
program adequate to prevent soll and subsoil wash out. It is recognized that Operator has superior knowledge of 1he location and access routes to the location, end must

                                                          (U.S. DayWOri< Contract· P~ogtt 3)                                                             Form provided by Forms On·A·Oisk
                               Copyright e 2003 lntematlonal Association of Drilling Contractors                                                        {214) 340..9429 • FormsOnADisk.
                                                                                                                                                                       Revised April, 2003
advise Contractor of any subsurface conditions, or obstructions (including, but not limited to, mines, cevarns, sink holes, streams, pipelines, power lines and
communication lines) which Contractor might encounter while eo route to the locatiOn or during operations hereunder. In the evant subsurface conditions cause a
cratertng or shifting of the location surface, or If seabed conditions prove unsatlmctory to property sCJpport the rig during tm~rlne operations hereunder, and
Joss or damage to the rig or Its associated equipment l'e$Uits therefrom, Operator Shall, Wlthollt regard to other provisions of this Contract, Including

Subparagraph 14.1 hereof, reimburse Contractor for all such loss or damage Including removal of debris and payment of Force Majeure Rate during repair
and/or demobilization If applicable.
11.   EQUIPMENT CAPACITY
      Operations shall not be attempted under any conditions which exceed the capacity or the equipment specified to be used hereunder or · !:lara saRal                er   •~alar   deplh&
are iA GKGess ef                                                        feet Without prejudice to the provisions of Paragraph 14 hereunder, Contractor shall have the right to make
the linat decision as to when an operation or attempted operation would exceed the capacity of specified equipment.
12.   TERMINATION OF LOCATION LIABILITY:
      When Contractor has concludod operations                at the well location, Operator shall thereafter be liable tor damage to property, personal injury or death
of any person which occurs as a result of conditions of the location and Contractor shall be relieved of such lklbitlty; provided, however, If Contractor shall

subsequently reenter upon the location for any reason, Including removal of the rig, any term of th& Contract relating                      to   such reentry actlvJty !hall become
<~ppl/cable   durfng such period.
13.   INSURANCE
      During the life of this Contract. ContractOI' shall al Contractors expense maintain, with an insurance oompeny or companies authorized to do businees in the
state where the work is to be performed or through a self-insurance program, insurance coverages of the kind and in the amount set forth in Exhibit "A", Insuring the
liabilities specifically assumed by Contractor In Paragraph 14 of this Contract. Contractor shall procure from the company 04' companies writing seid insurance a certificate
or certifiCates that said Insurance is in full foice and effect and that the same shalf not be canceled or matelia!Jy changed without ten (10) days prior written notice to
Operator. For liabilities aesumed hereunder by Contractor, its insurance shaU be endorsed to provide that the underwriters waive their right of subrogation agalll$1 Operator.
OpemtOI' wlll, as wen. cause itS lnl!urer to waive subrogation against Contractor for liability It assumes and l.lhall maintain, at Operator's expense,          04'   shall self     insu~.

insurance coverage as set forth in Extilblt •N of lhe same kind and in the same amount as is required of Contractor. Insuring the liabilities specir~catty assumed by Operator
In Paragraph 14 or this Contract. Operator shall procure from the company or companies writing said Insurance a certificate or certificates that said insurance Is in full force
and effect and that the same shall not be canceled or materially changed without ten (10) day$ prlorwrltten notice to Contractor. Operator and Contractor shall cause their
respective undGfWriters to name the other additionally insured but only to the extend of the indemnification obUgations assumed he~in.
14.   RESPONSIBJUTY FOR LOSS OR DAMAGE, INDEMNITY, RELEASE OF LIASIUTY AND ALLOCATION OF RISK:
      14.1 Contractors Sfltfac$ Equipment: Contnidor :shali8Uf.IIOO IJabltlty at all 1irm1$ tor damage to or de!StructJon of Contractort!~Wlface equipment, rogatliless of
when or how such damage or destrur:tlon occurs, lind Co,ntractor shall release Operator of any liability for any such loss, except loss or damage under the
provisions of Paragraph 10 or Subparagraph 14•.3.
      14.2 Contrnctor'$ Jn.Hole Equipment: Operator :shaJI assume IJablJlty at all time.s lor damage to or de$tructJon of .Confractor's in-hole equipment. Including, but not
limited tt:J, drill pipe, drill collars, and too/joints, and Operator Shall refmburs& Contractor for the val~ of any such loss or dam;ge; the value to be detesmfned
by agreement betw!X!n Contractor and Operator as current repair costs or                     100      percent of current ntw rap/a cement cost of such equipment delivered
to the well site.

      14.3 Contractor's Equipment· Envlromt1Walt.oss or Damage: Notwfthstandlng t/HI provisions of Subparagraph 14.1 above, Operator shall assume JhlbiJJty
at till times for damage to or deWuctfon. of Contractonl equipment result!ng from t/HI Pf$$ence of Hl;S, CO: or other corrosive elements that enter the driJf1ng fluid$ from
subsurface formations ort/HI us~ of corrosive, de$1rvctive or abrasive~ In the drilling fluid$..
      14.4 Operator'S Equipment: Operator shallllSSUI111J liablllty at all times lor datmtge to or destruction of ()peraton or Its co-venturers•, co-lessees' orjoint~·
eqtJJpment, Including, bllt   not llmlted to, casing. tubing, wefT head eqtJJpment., and platform If applicable, regardless of when or how such damage or destruction
occurs, and Operator shall release Contractor of any liability for any such loss or damage.
      14.~    The Hole: In the went the hole should be lost or damaged, Operator Shall be solely responsJble for such damage to or toss of the hole, Including the casing
theraln. Operator Shall release Contractor and Its suppliers, contractots and subcon~ of any tier of any liability for damage to or loss of the hole, and shalt protect,
defend and Indemnify Cootractor and. Its fWPp/W.s, c011fJ'actcw and subcontractots of any tier from and against any and all claims, liability, and expense relating to
such damage to or loss of the hole.

      14.6 Underground Damage: Operator shall relealse CMttactor and Its suppliers; contractors and :wbcontra~ of any tier of any llabl1lty for, and shall prof&Ct.
tkfend and indemnify Contractor ami Its suppliers, contractors and subcontractors of any tier from and against any and all cJaJms. liability, and expense resulting from
operation$ urn:terthfs ContTact on aeccwnt o(ln}wy to,. destnJctlon of, or I= or Impairment of any properly right In or to oil, gas. or other mineral 11ubstance or water, If at

the timli oftm act or omi$$JOn caUSing such Injury, riestruafon, loss, or Impairment, said substance had not been reduced to physical pClSseS$/on above the surface of the
earth, and for any los$ or damaf/8 to any formation, strata, orres&IVO/r bemath the slllfaceof the earth.
      14.7/nspectlon of Materials Fumfshad by Operator: Contractor agrees to visually Inspect all materials furnished by Operator befora using same and to
notify Operator of any apparent defects therein. Contractor shall not be liable for any loss or damage resUlting             from   the use of matMa/$ fumistled by Oper.tfor, and
Operator shall release Contractor from, and shalf protact. d(](end and Indemnify Contractor from and against, any such /lablltty.
      14.8 COntractor's lrntenmffTC<Jtion of Operator: Contractor shall release Operator of any /lability for, and shall protec1, defend and Indemnify Operator from and
against all clalms, dM'lands, and causes of ac.1ion of evert kind and character, wfthoutllmlt andwtthoutr&(lardto the cause or causes ifHireoforthfmegJigenceofenyparty
or parties, arising in connectlon hf!rrewfth In favor of~ employee$ or Contracror.. subcontractors of any tier (inclusive of any agoot or consdtanf engaged by

Contractol] or their employef$, or ComTactor's Invitees, on acCOWlt of bOdily              11!fury, deaJh   or damag!l to property.   Contractor'S Indemnity urnJe4' Ws Paragraph
shall be without reg;m:1   to   Md witholl(   any right to contribution from .any Insurance     malntalnflcl by   Operator pursuant to Paragraph 13. If It is Judic:Jally detemlined
that the monetary limits   of lnsurance required hereunder or of the Indemnities voluntarily assumed lJlldfJr Subparagraph 14.8 (wfJJch Contractor and                 0p«ator hereby
B!1fYl<' will be tWpported elth« by available Yab/Uty Insurance, under which the Insurer ha$ no right of subrogatlon against the Indemnities, or volunta.rily ulf.fnsured,
In palt or whole) exceed the maximum limits permitted under applicable law, It Is agreed that said Insurance                   requirements   or Jndemnltlt;s shall alltomatfcaJJy be
amended to conform to the maximum monetary limits permitted under such law.
      14.9 Operator's lndemnllkatlon of Contmctor. Operator ShaD release Contractor of any liability for, and shall protect. defend and lndemnJfy Contractor from Md
agaJnst all cJaJms. demands, and causes of action of every kind and character, wfthOut limit and without regard to the cause or causes thereof or the negligence of any
party or parlles, arising In connection herewith In favor of Oparator's employees or Operator'!i contractrm1 of any tier (inclusive of any                     agent, consdtanf or
subcontractor engaged by Operator) or their employees, or Operator's invitees, other than tho$e parlies ldentifled In Subparagraph 14.8 on account of bodily Injury, death or


                                                (U.S. Oa}'i'Kllf< Contract- Page 4)                                                   Form provided by Forms On-A-Disk           ('_~~
                                                                                                                                    ~"' ,_,..,~~-;,; 0~~~,•.
                           Copyright C 2003 lntemaUonal Association of Drilling Contractors
                                                                                                                                                                           Revised April, 2003
 damage to properly. Operator's Indemnity under this Ptlrllgraph shall be without regard to and without any right to contribuUon from any Insurance maJnfalned by
 Contractor pursuant to Paragraph 13. If It lsjudlclalty determined that the moneta1y limits of /ns(llllll(:e required hereunderoroftheinrJemnltle$ voluntalilyasstii1Hld under
Subparagraph 14.9 (which centractor and Operator                hereby tJgree will be supp¢1fed either by available liability inslll'anClt, under which the in$tii"'N' has no right        of

subrogation against the fndemn~, or voluntarily ~mwred. In                       part or whole} excood the maxlmunr limits permlt.ted undsT applicabh11aw, It Is           agreed that saki

lnsuranco raqulrements or lnoomnltiM shall automatlcally be amended to conform to the maximum monetary limits permitted under such law.
       14.10 Liabntty for Wild Well: Operator shall be liable for the cost of regaining control of any wfld well, as       wen as for cost of romovaJ of any debris and cost ofproperty
remodlation and restoration, and Operator shall release, protect, defend and Indemnify Contractor and lis suppliers, contractors and subcontractors of any 1/er from
and against any 1/ab/1/ty for such C0$1.
       14.11 Pollution or Contamination: Notwithstanding anything to the contrary contained herein, except the provisions of Paragraphs 10 and 12, It Is
undeT$tOod and agreed by and between Contractor and Operator that the rMponslbll/ty for pollution or contamination shall be as follows:
       (a) Contractor shan assume aJf responslbiUty for, lncJudlng control and removal of, and shall protect, defend and Indemnify Operator from and against aJf cla/ms,
demands and Call$$$ of action of evelj' kind and character arising from pollution or contamination, which originates above the s!Hface of the land or water from spills of
fuels, lubricant$, motor oils, pipe dope, paints, solvents, baJ1ast, bilge and garlJage, (l)(cept I.UUNOidable pollution from raserve pits, wholly In Contractor's possession
and control and dlrectty associated wfth Contractor's equipment and facilities.
       (b) Operator shall assume all rospon$lbll/tyfor, Including control and removal          or. and shan protect, defend and lndernnlfy Contractor andIts suppliel$. ~and
subcontractors of any 1/er from and against all claims, demands, and causes of actiDn of every kind and character arising directly or Indirectly ~ all other
pollution or contamination which may occur during the conduct of operations hereunder, including, but not Umlted to,                           that v.1lkh may iesuJt from iire,. blowout,
craterlng, seepage or any other uncontrolled flow of oil, gas, water or other substance, as well as the use or disposltlon of aJf dri/Jlng fluids, InclUding, but not limited to, on
emtJI$/on, oil base or chemkally trwlted drilling fluids, contaminated cuttings .or cavlngs, lost cflt;ulafion and f1$/r recovery materfaJs and f1uJds. Operator shall release
Contractor and Its supplier$, confraciof$ and sctbcontractors of anyt/erofany JlabJIIty for the foregoing.
       (c) in   tfM!   event a thfttt pal1.y commits an act or omJss/on which results in pc!lutlon or. contamination for which either CcntrtK:tor or aperator,. for whom i;UCh
party Is   pMormlng worlc, Is hel<l to be le{Jalfy liabJ&, the responslbiiJty therefor $hall b& considered, as between Ccntmctor·and. operator, to.be ·ttHI same·as If the
party for v.1lom the work was pelfonned had petformed the same and all of the ob/Jgstlons respecting                     protectJon. clefense, tnciemnity and IJmltation .of reSponsibility
and Jfabl/lty, as set forth in (a) and (b) above, shall be specifically applied.
       14.12 eor-quential Damages: Sl/b#ct to and without a!fectlng the provisions ofthkl C<mtract regarding the paymentrlght$ and obiJgatJons ofthe~ or the tJsk
of IO$f, ~and lnrtemnlty right$ and obligations of the parties, each piUty shall atalf tJmes be responslblMor and.l'iold hannless and Indemnify the otherpany from and
against Its     own tipeclal. 1ndil'ect or COll$eqU(lf7{la damages. and the parties agree that spec/a~ lndli'ect or consequentfa/ damages Shall be.deemed .to JncJude. without
limitation. the following: loss of profit or revenue; costs and (l)(JlMses resulting from~ /ntemJptions;.#Ms of or delay In produc1ion; ~ou·otordarilage.to the
leasehOld; loss of or delay In driiJJng or operating rights; cost of or loss of use ofproperty, equipment, materials and service$, InclUding Without.Um/fJdion thoSe PIOV/ded by
cont~actors     or subcontraciol'$ of every tier or by third part/tl$. Of)Mitar shall at all 1/mM be responsible for and hold hamiJess and lndemil/ti .~and its supp~
contnJctoli and subcontzactors of any tier from and against all cJaJms, demands and causes of action of every kind and cbatacter ln. c~ with sut:h.$p(!clal, lndltect
orwnsequei1tialriamagessufr-l by Openltor'.s~ ~enture~S, co-lessee$,~ tarmeeS, parlnersandjo/ntowners.
       14.13 Indemnity Obllga1fon: Except as otherwise expr0$sly limited In this Contract, It Is the /ntant of parties herato that aJll'fJleases, fndemntty oblfga1fona
and/or llabllltlo;; <J$$Umed by such parties underterms r:;f this Contract. Including, withoUt limitation, Subiwragraph114.9 and 6.3(c), PartAgraphs 10 and 12, and
Subparagraphs 14.1 through 14.12 hereof, be without limit and without regard to. the cause or causes theraof, Including, but notllmlted. to, p,..;exlsting
conditions, defect or ruin of premises or equipment, strict tlab/1/ty, regulatory or. statutory llablltty, prodiJCt$ 1/ablltty, ·braach of ,.,prenntatlon or Warranty
(express or 1mptt6dj, breach of duty (whether statutory, conf1actUal or othelwfse} any theory of tort, breach Ot contmct, fa~ the~ of any degree 01' character
(regarri/e$$ of Whether such negligence JsSQ/e,]olntorCOflCUmll'lt, active, pas5Jve or gross) of imy party Or part/as, Including the PattY seeking the ~offh9·~e,
lndemnltyorasWmption of liability, or any othertheo!y of legalllablHty. The /nCiemltltJeS, and releases and~ of llabl11ty emhcted bjthe [faft/es hereto Uridarthe
proVisions of SUbparagraph$ 4.9 and 6.3 and Paragraphs 1~ 12 and 14 shalf /niJ(e to the bf!neltt of such parties, their co-ventUTeT$, c0-les$iles, joint owners, tlletr
parent, holding and affiliated companies and the officel'$, directors, stockholdera, partnel'$, managtms, rapresentatlvas, employees, consultants, agent$,
servants and Insurers of each. Except as otherwise provided herein, such lndemntncation and assumptions of liability shall not be deemed to create any rights
to indemnification fn any p8f$On or ent/ty not a party to this Contract, either as a third party beneflclary or by raa$on of any agreement of lnderimtty between
one of the parties hereto and another peT$On or ent/ty not a party tD this Contract.
1$. AUDIT
      If any payment provided tor hereunder is made on the basis of Contractor's txJsls, Operator shall have !he right to audit .Contractor's books and recon:ls relating
to such cos!$. Contractor agrees to maintain such books and· retxJrds for a pertod of two (2) ~ars from !ht~ date i;vclt txJsts were incurred. and to make such. books
and records readily av8ilabfe to Operator at any reasonable time or times within !he period.
16.   NO WAIVER EXCEPT IN WRffiNG
      lt. Is My understood and agreed !hat none of the requirements of this Contract shall be considered as waiveo by either party unless !he                             same is   dOne in
writing. and the~ only by the pe~s executing this Contract, or other duly authorized agent or representative of the party.
17.   FORCE MAJEURE
      Except as provided in this Paragraph 17 and without prejudice to !he rlsk of loss, release and indemnity obligations under !his Contract, each party to this Contract
shall b6 excused        rrom   txJmptying with the terms of this Contract. llxcept for the payment or monies when due, if and for so long as such compliance Is hindered or
prevented by a Force Majeure Event. As used in this Contract "Force Majeure Event• Includes: acts of God, actiOn of !he elements. wars· (declared or undeclared),
insurrection, revolution. rebellions or ¢iVil strife, piracy, civil   war or hostile action, terrorist acts, riots, strikes, differellce$ with workmen,   a.Cl& ofpublle enemies, federal or
state laws, rules, regulations dispositions or orders of any governmental authorltles having jurisdiction In the premises or of any other group, organization or informal
association (whether or not formally recognized as a government), inability to procure material, equipment, fuel or neeessary labor in the open market, acute :and unusual
labor or material, equipment or fuel shortages, or any other causes (except financial) beyond the control of either party. Neither Operator nor Contractor shall be required
against its will to adjust any labor or similar disputes except in accordance with applicable law. In the event that either party hereto is rendereo unable, wholly or In part, by
any of these causes to carry out its obligation under this Contract, it Is agreed that such party shall give notice and details of Force Majeure in writing            to the other party as
promptly as possible after itS occurrence. In such cases, the obllgatlons of the party giving the notice shall be suspended during the Continuance of any lnabl1lty so caused
except that Operator shall be obligated to pay to Contractor the Force Majeure Rate provided for in Subparagraph 4.8 above.
18.   GOVERNING LAW:



                                                                                                                                                                                    @
      This Contract shall be construed, governed, Interpreted, enforced and litigated, and the relations between the parties detennlned In accordance with the law$

                                                  (U.S. Daywori< Contract • PJ19e 5)                                                     Form provided by Forms On-A·Olsl\
                                Copyright Q 2003 International Association of Drilling Contractor&                                      (214) 340.9429 • FormsOnAOlsk.com             • ,'(\\\~~. ,
                                                                                                                                                                     NCPSO            ~                    ·'
                                                                                                                                                                                                 .   ~-·
 19.     INFORMATION CONFIDENTIAL:
         Upon written request by Operator, information obtained by Contractor in the conduct of drilling operations on tills well, including, but not limited to, depth,
 formations penetrated, the results of coring, testing and surveying, shall be considered confidential and shall not be divulged by Contractor or its employees, to
 any person, firm, or corporation other tllan Operator's designated representatives.
 20.     SUBCONTRACTS:
         Eitller party may employ otller contractors to perform any of the operations or seJV!ces to be provided or performed by it according to Exhibit nA".
 21.     ATTORNEY'S FEES
         If this Contract is placed in the hands of an attorney for collection of any sums due hereunder, or suit is brought on same, or sums due hereunder are collected
 through bankruptcy or arbitration proceedings, tllen tile prevailing party shall be entitled to recover reasonable attorney's fees and costs.
 22.     CLAIMS AND UENS:
         Contractor agrees to pay all valid claims for labor, material, seTVices, and supplies to be furnished by Contractor hereunder, and agrees to allow no lien by
 such third parties to be fixed upon the lease. the well, or other property of the Operator or the land upon which said well Is located.
 23.    ASSIGNMENT:
         Neither party may assign this Contract without t11e prior written consent of the other, and prompt notice or any such intent to assign shall be given to the
                                                           .                                                                                                           .
 other party. In the event of such assignment. the a$Signing party $11all remain liable to the other party as a guarantor of the performance by the assignee of the
 terms of tllis Contract. If any assignment is made that materially alters Contraclor's financial burden, Contractor's compensation shall be adjusted to give effect
 to any increase or decrease in Contractor's opera1ing costs.
· 24.    NOTICES AND PLACE OF PAYMENT:
        Notices, reports, and other communications required or permitted by this Contract to be given or sent by one party to tile other shaH be delivered by hand,
 mailed, digitally transmitted or teiecopled to the address hereinabove shown. All sums payable hereunder to Contractor shall be payable at its address hereinabove shown
 unless otllerwise specified herein.
 25.    CONTINUING OBLIGATIONS:
        Notwithstal"lding the termination of thi$ Contract, tile parties shall continue to be bound by the provisions of tills Contract that reasonably require some action or
 forbearance after such termination.
 26,    ENTIRE AGREEMENT:
        Thl~   Contract constitutes tile full understanding of the parties, and a complete and exclusive statement of the terms of their agreement. and shalt exclusively
 control and govern all work performed hereunder. All representations, offers, and undertakings of the parties made prior to tile effective date hereof, whetller oral
 or in writing, are merged herein, and no otller contracts, agreements or work orders, executed prior to tile execution of tills Contract, shall in any              way modify,
 amend. alter or change any of the terms or conditions set out herein.
 27.    SPECIAL PROVISIONS:

 27.1 Exhibit "C"- Contractors Special Provjslons Is <tttached hereto and made a part hel'el)f.
 27.2 In the event of any dispute arising out of or relatedto this Contract, the partles agree that jurisdiction wlU lie exclusively with the state and federal courts
        In Houston, Harris County, Texas. Operator agrees and consent$ to the jurisdiction of the state and federal courts in Houston, Harris County, Texas, and
        waives any objection that such courts are an Improper or inconvenient venue or forum for such disputes.
 27.3 For periods of delay during rig moves, caused by circumstances beyond Contractor's control, Including, but r.~• .......'ted to, lnch~ment weather, lack of
      availability of roads, location, transportation equipment or permits, Operator shall pay Contractor a delay rate of$     per day.

 27.4 ~n~~~~~~e~~~~~~Fs ~~ch;~{~~!· an affiliate of Contractor, shall Invoice Operator, and Operator shall pay Can rig $                               per day (spud to release)


        ~~~~~~~. ~~P~\r~lkfneg"'sis,~:/:~e:k ~~!'::Jb,~ !~~gh~~~~",?:t~~~~:,'~or:~~~~~~u~~msfr!~~~!~ p~O:f~~~k:C:~~~~"(2T~~~~:~~~~~:I)~~~
                                                           1

        volume probes (6 probes included}, trip tank volume probes (f probe Included), and retum flow paddle.




 28.    ACCEPTANCE OF CONTRACT:

        The foregoing Contract. Including the provisions relating to fndemnfty, release of liability and allocation of risk of Subparagraphs 4.9 and 6.3(c),

Paragraphs 10 and 12, and Subparagraphs 14.1 through 14.12, Is acknowledged, agreed to and accepted by Operator                     this~ day of          5"o/" f     20   /0 .


                                                       OPERA:;_=~=;;=....;_;;::;~~~:;~~~~·;;-+-~~~
                                                                                            ~=C: 'l-F-;E,=_= =_e~:=_'l =_·L=-L=-C
 The foregoing Contract, Including the provisions relating to indemnity,              re/e;~se   of liability and allocation of rlt;k of Subparagraphs 4,g, 6.3(c), Paragraphs

 10 and 12, and Subparagraphs 14.1 through 14.12, is acknowledged, agreed to and accepted by Contractor this~ day of                                     September     20...1Q__

which Is the effective date of this Contract, subject to rig availability, ant! subject to all of Its terms and provisions, with the understanding that ft will not lle

binding 1.1pon Operator until Operator has noted Its acceptance, and with the further undcr$tandlng that unless said Contract is thus executed by Operator

within         Seven m     days of the above date Contractor shalt be in no manner bound by Its signature thereto.


                                                   CONTRACTOR:                                                                  ., Its General Partner

                                                                 By:      E. Nelson

                                                               Tme:    ~~~~~~~~~--------------------------------------



                                               (U.S. Dayv.'Ork Contract· Page 6)
                            Copyright Q 2003 lntemational Association of Drilling Contractors
     ····---··-····-·············-------------------------------..,

                                                                                                                                                                                Revised April, 2003


                                                                                         EXHIBIT "A"
To Daywork Contract dated _ __,Se~p:l5te~m~be~rw3~_, 20 __j.Q_

Operator       Penn Vlrolnla MC Energy. LLC                                                        Contractor        Nabors Dri!Jjng USA. LP

Well Name and Number               To be advised by Operator

                                                                          SPECIFICATIONS AND SPECIAL J>'RO\f!SIONS

1. CASING PROGRAM (See Paragraph 7)

                               Hole                  Casing                        Weight                        Grade                    Approxlmat&                     Walt on Cement
                                Size                  Size                                                                                Setting Oefnh                        Time
  Conductor                              in.                        in.                        lbslft.                                 _ _ _ _ _ ft.                     _ _ _ _ _ _ hrs

  Surface                                ln.                        in.
                                                                                                                                       _ _ _ _ _ ft.                     _ _ _ _ _ _ hrs
                                                                                               lbslft.
  Protection                             in.                        in.                        lbslft.                                 _ _ _ _ _ ft.                     _ _ _ _ _ _ hrs

                                         ln.                                                   lbslft.                                  _ _ _ _ _ _ It                   _ _ _ _ _ _ hr.;
                                                                    in.
  Production                             ln.                                                   lbslft                                  _ _ _ _ _ It                                  hr.;
                                                                    in.
  Liner                                  in.                        in.                        lbslft.
                                                                                                                                       _ _ _ _ _ It                      ------
                                                                                                                                                                         _ _ _ _ _ _ hr.;

                                         in.                        in.                                                                _ _ _ _ _ _ It                    _ _ _ _ _ _ hrs
                                                                                               lbslft

2. MUD CONTROL PROGRAM (See Subparagraph 8.2)

                      Depth Interval
                           (ft)
                                                                                                              Weight                                                         Water Loss
                                                                                                            (lbsJgal.)                                                          (cc)
             From                            To                           Type Mud




Othermudspeefficatlons: _ _ _ _ _ _ _ _ _-'-..:.....-_.__ _ _ _ _ _ _ _ _ _ _....,-_ _ _ _ _- - - - - - - - - - -




3. INSURANCE {See Paragraph 13}
      3.1      Adequate Workers' Compensation Insurance complying wltll State Laws applicable or Employers' liability lnsutance with limits or$                          one 111 million
               covering all of Contractor's employees working under this Contract.
      3.2      Commercial {or Comprehensive} General liability lnsutan<:(l, Including contractual obr.gations ·as respects this Contract and proper coverage for all
               other obUgatJons assumed in thla Contract. The limit shall be s_,.ooo..,..,r...,1!um!!ll,.ll!oo.:n...__ _ _ _ _ combined single limit per occurrence for Bodily Injury and
               Property Damage.
      3.3      Automobile Public Liability Insurance with limits of$         one 111 million             for the <Ieath or Injury   or eaCh person and $      one f1l m!!llon              -for each
      accident; and Automobile Public Liability Property Damage Insurance With limits of$                          one (11 mllllon                  ror each accident.
      3.4      IR   IRa   &"eRt epeliltlMB   iue. ll"SF   "rater, CemlliiGtGr   sllall   ~a                          StalutQ1)'   WQrkaFa' GgmpeRsa!leA IA&blf8FIG91 SAIJgFSemeAIS GG"9AA9
                                                                                                                                      fRl9ASRGe SRQ GUF!l urjtJl.Jimrui!sKGlf..f$~======

      ~~~~~~~~==========~~~~~
      3.5 Other insurance: ExcessllabllitV lnsurence In the amount of $4 million dolla!'$ nn excess of 3.1. 3.2 and 3.3}. Ooerator w!l! purchue oee Insurance
      In an amount not less than $10 million dollal'$lnsurtnq the l!abl!ttles assume<! by the O!)!H'lrtpr under this Con1racl


4. EQUIPMENT, MATERIALS AND SER\f!CES TO BE FURNISHED BY CONTRACTOR:
      The machinery, equipmant, tools, material$, supplies, Instruments, ·services and labor hereinafter listed, including any transportation required for such
items, shall be provided at the well location at the expense of Contractor unlesG otherwise noted by this Contract.
      4. f     Drilling Rig •subject to availability
     Complete drilling rig, designated by Contractor as its Rig No. _ ___..F_.,2..,s•_ __., the major items of equipment being:
Orawworns:MakeandMQdei ___P~e~r~rl~g~ln~v~enwto~n~a~tta~w~m~h~i~n®~~an~d~m~a~d~a~a~~~rt~~~rno~f~.----------------------------------------
Engines:No.
        Make,  Model,
            on Rig    and H.P. - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
                   ____________________________________________________                                      __

Pumps: No.1 Make, Size, and Power _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __
             N~2Ma~.saa,andPower              _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __
Mud Mixing Pump: Make, Saa, and Power _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __
Boilers: Number, Make, H.P. and W.P. _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __
Derrick or Mast Make, Size, and Capacity _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __

Substructure: Saa and Capacity _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __

Ro~ryDrtve:T~----------------------------------------------------------
Drill Pipe: Saa _ ___,...__ _ _ in. weights and grade§ as necnsan to maln~ln 100 ooo lb$ overoul! ft; Size: _ _ _ _ _ in. _ _ _ _ _ _ It
Drill Collars: Number and Size          43-e 318" <nomlnaf)- 1()..8" tnom!nall




                                                                                                                                                                                       ,r·~
                                             (U.S. DaymrkContract· •&1Jibi1A•·Page 1)                                                           Form provided by Fonns On-A-DiskfI ,...~\''"            \J
                               Copyright Q 2003 lntemafional Association of Drilling Contractors                                               (214} 340-9429 • FormsOnADisk.~·Y·
                                                                                                                                                                                           ... ;;··J
                                                                                                                                                                                             ~
                                                                                                                                                                                                        ·
                                                                                                                                                                           NCPS                        62
                             ···---·--------------------------------..,

                                                                                                                                                                   Revised April, 2003
BlowoutPreventers: _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __

              Size                                   Series or Test Pr.                             Make&Mode!                                        Numt>.lr




  B.O.P. ClOsing Unit:
  B.O.P. Accumulator;

      4.2   Derrick timbers.
      4.3   Normal strings of drill pipe and dnll collars specified above.
      4.4   Conventional dlift indicator.
      4.5   Cin:ulatlng mud pi!$.
      4.6   Necessary pipe racks and rigging up material.
     4.7    WO!'Iilalslal'age far m11~ aRe shemisals.
     4.8    Shale Shaker.
     4.9

     4.10   -----------~--------------------------------------------
     4.11 - - - , . - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
     4.12 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
     4.13 -..,.---'------------------------------------~-~~~~~
     4.14 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - ; . . , . . ; . . - - - -
     4.15 - - - - - - , - - - - - - ; _ _ ; _ __ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _---,...,---,-;__------
     4~16   -----,----------,--------------------'--..,------,...-
     4.17   --------~~-------------------------------------~~------
5; EQUIPMENT, MATERW..S AND SERVICES TO BE FURNISHED BY OPERATOR:
     The ma<:hlnery, equipment. tools, material:~, supplies, inslruments, services and labor hereinafter listed, inclUding any transportation required for such Item$, Shall be
provided at the well location at the expense of Operator unless otherwise noted by this Contract.

     5. f    Fumish and maintain adequate roadway and/or canal to location, rlght-of-way, Including rlghts-of-way ror fuel and water lines, river crossings, highway
             crossings, gates and cattle guards.
      5.2 Siake.lcicatlon, clear  an.d    grade location. and provide turnaround, including surfacing when necessary.
      5,3 Test tanks With pipe and fittings.
      5.4 Mud stornge tanks wito pipe and fittings.
      5.5 Separator With pipe and fittings.
      6.6 Labor and materials to connect and disconnect mud tank, test tank, and mud gas separator.
      5.7 LabOr to.dlsconnect and clean test tanks and mud gas Separator.
      5.8 Drilling niud, chemicals; lost circi.Jiatlon materials and other additives.
      5.9 Pipe and connections foro~ circulating lines.
      5.10 Labor to lay, bury andrecover oil circulating 11nes.
      5.11.. Drilling bits, ·reamers•. reamer cutters, stabilizers and special tool.s.
      5.1.2 Contract fishing tool sei'VIces and tool rental.
      5;13 Wire line cere bitS or heads, core barrels and wire Hne core catchers if required.
      5.14 Convenllonal core bits, core catchers and core barrels.
     ·5.15 Diamond core barrel with head.
     M& Cement and Cemeriung service.
     5.17 EleCtriCai wiretine JOgging services.
     5.111 Directlonsl, caliper, or o1her special services.
     5.19. Gun orjet perforating servlce3.
     s.20 Explosives and shooting devices.
     5.21. · Formation testing, hydraulic fracturtng, acidizing and other related services.
     5.22 Equipment for i:lrill stem testing.
     5.23 · Mud logging services.
     5.24 ~id~ll coring sei'/lce.
     5.25 Welding SEl!VIce for wekling bottom joints of casing, guide shoe. float shoe, float collar ani:lln connection with insta:lflng of well heai:l equipment If required.
     5.26. Casing, tubing, finers, screen, Hoat collars, guide and float shoes and associated equipment.
     5.27 Casing scra~ers. and centralizers.
     5.28 Well head cOnneCtions and all equipmant to be Installed In or on well or on the premises for use in connection With testing, completion and operation of well.
     5.29 Special or added storage ror mui:l and chemicals.
     5.3.0 Casinghead, API series, to confonn to that shown for the blowout preventers specified In Subparagraph 4.1 above.
     6.31 Blowout preventer testing pad\off and testing services.
     5.32 Replacement of BOP rubbers, elements and seals. if required, after initial test
     5.33 Casing Thread Protectors and CaGing Lubricants.
     6.34 rbS training and equipment as necessary or as required by law.
     5.35 Slte.septic systems.
     5.36      Ditching around rig and location
     5.37      Third party BOP testing urvlce

     5.38 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
     5.39 --------------------~~----~---------------------------------------------------
     5.~ ------------~----------------------------------------------------------------------~
     5A1 ------~---------------'-------------------------------------------~--~--~--~-----
     5A2 -----------------------------~~-------------------------------------------------
     6.43 ------------------------------------------------------------------------~--~---
     5.M ----------------~------------------------------------------------------------~-
     5.~ --~----------------------;__----------------------------------------------~~---
     5.~-------------------------------------------------------------------------,...-----
     5.47 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
     5.~ -----------------~------~----------------------------------------------------~
     5.49 - - - - - - - ' - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - ' - - - - -
     5.50 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -


                                                                                                                                                                                 ····~"\    ,
                                                                                                                                                                                           ..
                                         (U.S. DaywotkContract • •Exhibit A·· P;tgt~ 2)
                          Copyright Q 2003 International Association of Drilling Contraetors
                                                                                                                                   Fonn provided by Forms On-A-Disk~- C'· '~\
                                                                                                                                  {214) 340-9429 • FormsOnADisk.com "X\)>J~f' i

                                                                                                                                                     .        NCPS               0~63
                                                                                                                                                                                             Revised April, 2003
6.    EQUIPMENT, MATERIALS AND SERVICES TO BE FURNISHED BY DESIGNATED PARTY:

      The machinety, equipment. tools, materials, supplies, instruments, sefVices, and labor listed as the folloWing numbered items, Including any transport.atlon
required for such items unless otherwise specified, shall be provided at the well location and at the expense of the party hereto as designated by an X mark In the
appropriate column.
                                                                                                                                                           To Be Provided By and
                                                                                                                                                             At The Expense Of
                                                                       Item                                                                     Operator                            Contractor
      6.1    Cellar and Runways ............................................................................................                      X
      6.2    Ditches and sumps ..............................................................................................                      X
      6.3    Fuel (located at                                                        .................................................             X
      6.4    Fuel Lines (length              of rig only                           ) .................................................                                                  X
      6.5    Water at source, induding required permits ........................................................                                   X
      6.6    Water well, induditlg required permits ................................................................                               X
      6.7    Water lines, including required permits ...............................................................                               X
      6.8    Water storage tanks                                         capacity (Per ng lnventoty) .............. ..                                                                  X
      6.9    Potable water and bottled water ....................................................................... .                             X
     6.10    Labor to operate water welt or water pump {Rig crew only)...............................                                                                                    X
     6.11    Maintenance of water well, If required .................................................................                              X
     6.12    Water Pump ........................................................................................................                   X
     6.13    Fuel for water pump.............................................................................................                      X
     6.14    Mats for engines and boilers, or motors and mud pumps ...................................                                             X
     6.15    Transportation of Contractor's property;
             Move ln ........................................·........................................................................      See Paragraph 4.1
             Move out .............................................. ;................................................. :........... ..     See Paragraph 4.2
     6.16    Materials for "boxing in" rig and derrick ...............................................;....,........ ..                            NJA                                 NJA
     6.17    Spedal sirlngs of drill pipe and drill collars as follows:
             Any required                                                                                                                          X


     6.18   Kelly joints, subs, elevators, tongs, slips and BOP rams for use with special
            drill pipe ..............:...............................; ....................;...........................................            X
     6.19   Drill pipe protectors for Kelly joint and each joint
            of drill pipe running Inside of Surface Casing as required,
            tor use with normal strings of drill pipe .............................:..................................                             X
     6.20   Drill pipe protectors for Kelly joint and drill pipe running
            Inside or Protection Casing .........................................,., .•:......................, ............ .                     X
     6.21   Rate of penetration recording device (Can rig el&ctronlc) ..................................                                                                                 X
     6.22   Extra labol' for running and cementing casing (Casing crews) ............................                                              X
     6.23   Casing tools ...........................................................................:.............................                 X
     6.24   Power casing tongs ........................,....................................,...............................                       X
     6.25   Laydown and pickup machine ............,.~ .......... :.....................:.............................                             X
     6.26   Tubing toots ........................................'.. :........ :, .........................;...................~ ... ;..           X
     6.27   Power tubing tong ... ;......:....... ;........... :.............. ;,,;,:,.;••••:.........:..... ;....... :; .........,•.;.;.
     6.28   Crew Boats, Number_..;..._ _ _ _ _.....................................................                                               NIA                                  NIA
     6.29   Service Barge ......... ;.............................:.......;.............:...................... :.................. ..            NJA                                  N/A
     6.30   Service Tug Boat ...................................................................;.......................;... ..                   NJA                                  NIA
     6.31   Rat Hole ..................................................................;..............:.... ;..............:.....:..               X
     6.32   Mouse Hole .....................................:.............:..........................:..........................                   X
     6.33   Reserve.Pits .................;.................:.............................,,. .........:....................:..... ..              X
     6.34   Upper Kelly Cock.................................;..........·............... ,.....................................                                                          X
     6.35   Lower Kelly Valve .....................................;............................,.............................                                                          X
     6.36   Orlll Pipe Safety Valve ........................:.......;..:.......;............;......:.... ~ .........~ ......... .                                                       X
     6.37   Inside Blowout Preventer: .................................;.......................................:........ ..                                                             X
     6.38   Drilling Hole for or driving for conductor pipe.~ ...............:•.•. ,........:...................;.. .                              X
     6.39   CHarges, cost of bonds:ror public roads ......:..................................:.................. ..                                X
     6.40   Portable Toilet .......................................:...........................................;.................                  X
     6.41   Trash Receptacle ..................................:.....................:.......................................                      X
     6.42   ~Shale SHaker (Per rlg lnv&ntory) ......................................,........ ,                                                                                         X
     6.43   Shale Shaker Screens................,........................................................................ .                        X
     6.44   Mud Cleaner ............. ;.........................................................:.................~; .............                 X
     6.45   Mud/Gas Separator ........... ;.................................................................................                       X
     6.4&   Desander ................................................:.....................;............................:..........                                                     X
     6.47   Desilter ...................................,. ...............;................ ;...........................................                                                X
     6.48   Degasser (Per rig Inventory) .........;••.,......., .........................................,.... ;.. ,... ..                                                              X
     6.49   Centrifuge .........................;..................................................................................                X
     6.50   Rotating Head .....................................................................................................                    X
     6.$1   Rotating Head Rubbers .......................................................................................                          X
     6.52   Hydraulic Adjustable Choke ......................................................................;.........                            X
     6.63   Pit Volume Totalizer ............................................................................................                      X
     6.54   Communication, type                   CCellular phone for rig usg ontvl                                        ........... ..                                               X
     6.55   Forklift, capacity            Model JLG G9-43A INOUSA. LP prgferred model! or a
            JLG G10-55A !10,000 lb Uft With O\ltrigge!Jl With a Star Industries gulcJs·Iach
            TMS boom Model1302..JLG                                                 .                                                              X
     6.56   Corrosion Inhibitor for protecting drill string ....... ;.................................................                             X
     6.57
     6.58
     6.69
     6.60




                                                                                                                                                                                                        .. ~···- ........
                                                                                                                                                                                                    /
                                                   (U.S. Oeywork CQnt~ • "Exhibit A"· Page 3)                                                                   Form provided by Forms On-A-Disk/            . :
                               Copyright e 2003 International Association of Drilling Contractors                                                               (214) 340-9429 • formsOnADisk.~.,:. ·           __.

                                                                                                                                                                                       NCPS\~foa64
     7.   OTHER PROVISIONS:




                                    (U.S. Daywork Contract· 'Exhibit A"- Page 4)
                        Copyright C 2003 International Association of Drilling Contractors



----------------------------------------·-··---·-----·---·----·---------
                                                                                                                                                   Revissd April, 2003

                                                                                         EXHIBlTwB"
                                                                                 (See Subparagraph 8.3)

The following clauses, when required by law, are Incorporated in the Contract by reference as if fully set out
(1)         The Equal Opportunity Clause prescribed in 41 CFR 60·1.4.
(2)         The Affirmative Action Clause prescribed in 41 CFR 60-250.4 regarding veterans and veterans of the Vietnam era.
(3)         The Alflrmallve Action Clause for handicapped workers prescribed in 41 CFR 60-741.4.
(4)         The CertiflCS.tion or Compliance with Environmental Laws prescn'bed in 40 CFR 15.20.




                                                                                                                                                               ,.. ... :-·-......
                                       (U.S. Daywori< Cootract • "Exhibit$"· PIS<}& 1)                                   Form provided by Forms On·A·Disk /'. . .
                          Copytlgllt C 2003 lntemalional Association of Drilling Contractors                            {214} 340.9429 • FormsOnADisk.com 1 ~·'

                                                                                                                                              NCPS~66
                        -----·-------·---·--··--------------------------,

                                                EXHIBIT "C"
                                CONTRACTORS SPECIAL PROVISIONS

1.    Contractor shafl furnish initial tested annular preventer element. If the element is damaged due to destructive
      elements introduced to the mud, stripping, or ex;;essive testing, the Operator agrees to furnish a new element.

2.    Chemical Additives to the mud for preventing oXidation of the drill string and hydrogen sulfide scavenging
      chemicals to treat the mud or drilling fluid as necessary to remove all traces of H2S and to control oxygen
      corrosion to be furnished by the Operator.

3.    Operator shall furnish all labor, equipment and materials to clean rig after use of oil base mud and/or completion
      fluid.

4.    Extra cost to rig up for drilling with oil base mud including, but not limited to, the cost of pit covers, steam
      cleaners, drip pans, mud vacs and cleaning materials shall be at Operator's expense.

5.    Initial inspection of all Contractor's drill pipe, drill collars, kelly, kelly joints, valves, subs and HWDP shall be at
      Contractor's expense. All repairs, replacements and hauling for repairs will be at Contractor's expense. {The
      inspection will be to T.H. Hill, OS 1, Category 3 or its equivalent).

6.    Subsequent inspections (including the inspection at the end of the job) of all drill pipe, drill collars, kelly, kelly
      joints, valves, subs and HWDP shall be at the Operator's expense. All repairs, replacements and hauling for
      repairs will be at Operator's expense; {The inspection will be to T.H. Hill, DS1, Category 3 or its equivalent).

7.    Operator shall furnish all screens for shale shakers.

8.    Operator shall furnish all potable water for Operator and Contractor personneL

9.    Operator, Operator's representatives and. Operator's sub-contractors shall support Contractor's Safety Policies
      and Pr.oce<iures. in general and in particular, will. comply with all Contractor's personal protective equipment
      requirements.

10.   Operator will be responsible for the provision and maintenance of any site septic systems.

11.   Contractor will provide only one size of mud pump liners. Any additional sizes required by Operator will be
      provided by Operator at Operator's cost.

12.   All third party equipment required to nipple up/nipple down .BOP equipment will be provided and paid for by
      Operator.

13.   The rates contained in this Contract are based on the rig inventory attached hereto. Any modification or addition
      to the rig requested by Operator will be at Operator's expense.

14.   Operator shall test BOP. equipment at Intervals as specified. in. federal,· state or local. regulations, API
      Recori'Jm~nded .Practice pr every twenty:one (21) days whichever interval is more stringent. All testing will be
      performed by an independent testing company provided and paid for by Operator.

15.   In all <:ases where Contractor's employees (including Contractor's direct, borrowed, special or statutory
      employees) are covered by the.Louisiana Worker's Compensation Act, La. R S. 23:1021 et seq., Operator and
      .Contractor agree .that au· work and •operations performed by .Contractor. and ·its employees pursuant to this
      agreement are ~:~n int~ral part of and are essentialto the ability of Operator to generate Operator's goods,
      products and services. Furthermore, Operator and Contractor agree that Operator is a statutory employer of
      Contractor's employees for purposes of La. R. S. 23:1061 (A} (3). Notwithstanding Operator's status as a
      statutory employer or special employer (as defined in La. R. S. 23:1031 (C)) of Contractor's employees,
      Contractor shaH remain primarily responsible for the payment of Louisiana Worker's Compensation benefits to
      its employees. and shall not be entitled to seek contribution for any such payments from Operator.

16.   Operator, Its parent, subsidiary and affiliated corporations, as wen as the employees, officers and directors. of
      each (collectively,"Operator"} is cognizant of the Nabors Dispute ResoliJUori Program and wishes to become an
      Electing Entity, as.detined in .that Program, Accordingly, Operator and Nabors Industries, Inc. ("Nabors•) hereby
      agree that Operator is. an Electing Entity. as to all Disputes between Operator and the present and former
      Employees and Applicants of Nabors· pursuant to the Nabors Dispute Resolution Program as it currently exists
      and as may be amended from time to time. In the event the Program is amended, Nabors agrees to. provide a
      copy of the amendment(s) to Operator.·. Operator.may withdraw this election to participate in the Program at any
      time by giving nQtice of such. withdrawa.l to. Nabors, sucn revocation to be effective with respect to any claims not
      yet Instituted as· of the date of revocation .. Operator understands that it is bound by the terms of the Program
      with respect to aU Disputes with Nabors employees; regardless of whether such Dispute is initiated by the
      employee ot by Operator. Operator and Nabors acknowledge that the Program does not apply to disputes
      between Operator and Nabors and that the Program does not alter the terms of any indemnification agreement
      between them.

17.   In the event Operator electsto drill a substitute well it shall be Operator's obligation to advise Contractor in
      writing of such change. Notwithstanding Operator's failure to notify Contractor of such change, the terms of this
      Contract shall apply to such substitute well as if such substitute well were the well specified in Paragraph 1 of the
      Contract.




                                                                                                                                 \
                                     NABORS DRILLING USA, LP

                                          PACE 1500 - RIG F26

                          Programmable AC Electric 1500 HP Rig
                                                                                                                fill~
DRAWWORKS:           1,500 horsepower AC drawworks featuring regenerative AC braking.           Drawworks is driven by   two (2)
                     800 horsepower AC motors. Autodrill functionality utilizing AC motor.

POWER GENERATION:    Three (3) - caterpillar 35128 engines rated at 1,476 horsepower each, driving one (1) Kato 1365 KW
                     generator, for a total of 4,428 horsepower. AC power generation, Variable Frequency Drive (VFD) and
                     MCC unitized in a single house.

MAST:                Pyramid Fast Moving Land Rig 152' three section mast manufactured to API-4F specification. Static
                     hook load of 1,0001 000 lbs. on 12 lines. Mast is raised and lowered utilizing hydraulic cylinders. Mast
                     has integrated top drive rails (enables top drive to travel in mast during rig move).

SUBSTRUCfURE:        Pyramid hydraulically elevated substructure with 30' floor height and 26' clear height under rotary
                     beams. Substructure is rated for 1,000,000 lbs rotary load simultaneous with a 600,000 lbs setback
                     load.

DRILLER'S CONTROL:   Climate controlled driller's cabin provides integrated joystick control utilizing PLC technology. Touch
                     screen controls provide state-of-the-art monitoring, control of rig equipment and drilling parameters.

MUD PUMPS:           Two (2) 11600 horsepower mud pumps. Each powered by one (1) 1600 horsepower AC motor, pumps
                     are equipped with hydraulic liner retention and pump rod systems.

MUD TANKS:           Three (3) tank system total capacity approximately 1,500 BBL; four (4) 6" x 8" centrifugal pumps
                     powered by 100 horsepower electric motors. 100 BBL trip tank.

SOLIDS CONTROL:      Three {3) Swaco Mongoose shale shakers
                     One (1) Swaco mud cleaner with desander I desilter.

WATER STORAGE:       One (1) 500 BBL water tank.

FUEL STORAGE:        One (1) 20,000 gallon diesel fuel tank.

TRAVELING BLOCK      500 ton traveling block, grooved for 13/8" drill line.

TOP DRIVE            canrig 1250 AC, 500 ton integrally mounted top drive system.

ROTARY:              37-1/2" rotary table, independently driven by AC motor.

ACCUMULATOR:         Six (6) station accumulator unit with one (1) electric triplex and two (2) air operated pumps. Unit will be
                     designed in accordance with API 160. Remote panel will be mounted at drill floor.

BLOWOUT              Annular:        13-5/8,, x 5000 psi.
PREVENTERS:          Double Ram:     13-5/8" x 10,000 psi.
                     Single Ram:     13-5/8'' x 10,000 psi.
                     Manifold:       4-1/16" x 3-1/16" 10,000 psi.

DRILL PIPE:          As per contract.

DRILL COLLARS:       As per contract.

ADD. EQUIPMENT:      Dedicated man-rider winch                                Automated catwalk 1 pipe handling system
                     Varco ST-80 Iron Roughneck                               Two (2) air operated hoists
                     BOP Handling system                                      Air operated slips
                     Rotating mousehole                                       Camera system
                     Intercom system                                          Vacuum degasser




                                                                                                                          ..,··
                                                                                                                         ./        \
                                                                                                                      -~6os.
                                                                                                                                       \
Revision 0                                                                                                   August
                                                                                                           NCPS 00~8
                                    CAUSE NO. 2014-42519

ALFREDO DE LA GARZA,                               §             IN THE DISTRICT COURT OF
INDIVIDUALLY and AS NEXT FRIEND                    §
FOR REDACTED                                       §
                      , minors                     §
                                                   §
                                                   §                HARRIS COUNTY, TEXAS
                                                   §
PENN VIRGINIA OIL & GAS, LP,                       §
PENN VIRGINIA OIL & GAS GP, LLC,                   §
MIKE FERGUSON, TRIFECTA                            §
OILFIELD SERVICES, LLC, CUDD                       §
PRESSURE CONTROL, INC.,                            §
ROYWELL SERVICES, INC. and OAKS                    §
PERSONNEL SERVICES, INC. d/b/a                     §
THE OAKS GROUP                                     §                281 ST ITJDICIAL DISTRICT


                            AFFIDAVIT OF KEITH NICHOLSON

STATE OF TEXAS                §
                              §
COUNTY OF HARRIS              §

         Before me, the undersigned notary, on this day personatly appeared Keith Nicholson, the
affiant, a person whose identity is known to me. After I administered an oath to affiant, the
affiant testified:

L      "My name is Keith Nicholson. I am over 18 years of age, of sound mind, and capable of
       making this affidavit. The facts stated in this affidavit are within my personal knowledge
       and are true and correct.

2..    I am Assistant General Counsel for Nabors Corporate Services, Inc.

3.     In my capacity as Assistant General Counsel, I am required to be familiar with Nabors
       Industries, Inc.'s corporate structure and the relationship of its various subsidiaries and
       affiliated companies. I am also required to be familiar with the Nabors Dispute
       Resolution Program ("DRP").

4.     Nabors Industries, Inc. is the "Sponsor" of the Nabors DRP as that term is defmed by the
       DRP. A true and correct copy of the DRP is attached to my affidavit as Exhibit 1-A.

5...   The DRP provides that it applies to all direct and indirect subsidiaries of Nabors
       Industries, Inc., as well as all "Electing Entities"· that have agreed to be bound by same.

6.     Nabors Completion & Production Services Co. ("NCPS") was a subsidiary of Nabors


                                                                                           EXHIBIT

                                                                                     I f
      Industries, Inc. at the time of the April 29, 2014 incident which makes the basis of the
      lawsuit.

7.    On September 23, 2008, Penn Virginia Oil & Gas, LP agreed to be bound by the DRP as
      an "Electing Entity" in the "Contractors Special Provisions" contained in the International
      Association of Drilling Contractors ("IADC") Drilling Contract between it and Nabors
      Drilling USA LP. A true and correct copy of the IADC Contract is attached in its entirety
      to my affidavit as Exhibit 1-B. The Contractors Special Provisions portion has been
      pulled out for reference and is attached as Exhibit 1-C.

8..   The Contractors Special Provisions page states at paragraph 16 that "Operator, its parent,
      subsidiary, and affiliated corporations ... (collectively "Operator") is cognizant of the
      Nabors Dispute Resolution Program and wishes to become an Electing Entity, as defined
      in that Program. Accordingly, Operator and Nabors Industries, Inc. ("Nabors") hereby
      agree that Operator is an Electing Entity ... "

9.:   In addition, on September 8, 2010, Penn Virginia MC Energy, LLC agreed to be bound
      by the DRP as an "Electing Entity" in the "Contractors Special Provisions" contained in
      the International Association of Drilling Contractors (''IADC") Drilling Contract between
      it and Nabors Drilling USA LP. A true and correct copy of the IADC Contract is attached
      in its entirety to my affidavit as Exhibit 1-D. The Contractors Special Provisions portion
      has been pulled out for reference and is attached as Exhibit 1-E. It is my understanding
      that Penn Virginia MC Energy, LLC is a subsidiary or affiliated corporation of Penn
      Virginia Oil & Gas, LP and/or Penn Virginia Oil & Gas GP, LLC.

10.   As an "Electing Entity," Defendants, Penn Virginia Oil & Gas, LP and Penn Virginia Oil
      & Gas GP, LLC are required to resolve disputes with any past or present employee(s) or
      applicant(s) of Nabors Industries, Inc. or its subsidiaries in accordance with the DRP.

11.   Based upon my review of the personnel file of Mr. Adame, I can confirm that Mr. Adan1e
      was employed by NCPS, and that he executed various documents that acknowledged that
      he received, reviewed, and accepted the terms and conditions of the DRP.

12.   Specifically, my review of the relevant documents confirms that on January 2, 2013, Mr.
      Adame executed a document entitled "Application For Hourly And Daily Employment,"
      a true and correct copy of which is attached as Exhibit 1-F. Mr. Adame acknowledged
      and agreed by his signature that he is "required to adhere to the Dispute Resolution
      Program and its requirement for submission of all claims to ... arbitration."

13.   Further, on January 7, 2013, Mr. Adame executed a document entitled "Employee
      Acknowledgement Concerning Nabors Dispute Resolution Program," a true and correct
      copy of which is attached as Exhibit 1-H. The document specifically states, "I have
      received a copy of the Nabors Dispute Resolution Program." Mr. Adame acknowledged
      and agreed by his signature that he is "required to adhere to the Dispute Resolution
      Program and its requirement for submission of all claims to ... arbitration.''
14.   Mr. Adame was employed by NCPS as a crew worker. As a crew worker, Mr. Adame's
      job duties and responsibilities included the operation of hand and power tools to perform
      maintenance and repairs to oil or gas wells and related equipment. Mr. Adame's job
      duties also involved activities associated with rigging-up and rigging-down work over
      rigs, pulling levers or turning handles to extend hydraulic or screw-type jacks to support
      and level the rig, laying steel production rods, tubing, and casing, and other tasks
      necessary to support operations. While employed by NCPS, Mr. Adame was never a
      commercial truck driver or transportation worker.

15.   Based upon my review of the personnel file of Mr. Alfredo De La Garza, I can confirm
      that Mr. De La Garza was employed by NCPS, and that he executed various documents
      that acknowledged that he received, reviewed, and accepted the terms and conditions of
      the DRP.

16.   Specifically, my review of the relevant documents confirms that on July 16, 2013, Mr. De
      La Garza executed a document entitled "Application For Hourly And Daily
      Employment," a true and correct copy of which is attached as Exhibit 1-G. By his
      signature, Mr. De La Garza acknowledged and agreed that he is "required to adhere to the
      Dispute Resolution Program and its requirement for submission of all claims
      to ... arbitration."

17~   Further, on July 22, 2013, Mr. De La Garza executed a document entitled "Employee
      Acknowledgement Concerning Nabors Dispute Resolution Program,'' a true and correct
      copy of which is attached as Exhibit 1-I. The document specifically states, "I have
      received a copy of the Nabors Dispute Resolution Program." Mr. De La Garza
      acknowledged and agreed by his signature that he is "required to adhere to the Dispute
      Resolution Program and its requirement for submission of all claims to ... arbitration."

18.   I\1r. De La Garza was employed by NCPS as a crew worker. As a crew worker, Mr. De
      La Garza's job duties and responsibilities included the operation of hand and power tools
      to perform maintenance and repairs to oil or gas wells and related equipment. Mr. De La
      Garza's job duties also involved activities associated with rigging-up and rigging-down
      work over rigs, pulling levers or turning handles to extend hydraulic or screw-type jacks
      to support and level the rig, laying steel production rods, tubing, and casing, and other
      tasks necessary to support operations. Mr. De La Garza's job duties and responsibilities
      did not include the movement of goods in interstate commerce. While employed by
      NCPS, Mr. De La Garza was never a commercial truck driver or transportation worker.

19.   At all times relevant to this matter, NCPS was engaged in interstate commerce as it was
      in the business of providing services for the development of oil and gas resources that are
      placed into commerce in both Texas and other states of the United States.

20.   On information and belief, Penn Virginia is also engaged in interstate commerce as it is
      in the business of producing oil and gas resources that are placed into commerce in both
      Texas and other states of the United States.
2L            Attached as Exhibit 1-A to my affidavit is a true and correct copy of Nabors Industries,
              Inc.'s DRP booklet, in English and Spanish, respectively. These records are kept by
              Nabors Industries, Inc. in the regular course and scope of business, and it was the regular
              course of business of Nabors Industries, Inc. for an employee or representative ofNabors
              Industries, Inc., with knowledge of the act or event that was recorded, to make these
              records or to transmit the information to be included in these records. These records were
              made at or near the time or reasonably soon after the act or event that was recorded.

22.           Attached as Exhibit 1-B to my affidavit is a true and correct copy of the 2008 IADC
              Drilling Contract between Nabors and Penn Virginia Oil & Gas, LP, and attached as
              Exhibit 1-C is a true and correct copy of the portion of the IADC contract titled
              "Contractors Special Provisions." These records are kept by Nabors Industries, Inc. in the
              regular course and scope of business, and it was the regular course of business of Nabors
              Industries, Inc. for an e1nployee or representative of Nabors Industries, Inc., with
              knowledge of the act or event that was recorded, to make these records or to transmit the
              information to be included in these records. These records were made at or near the time
              or reasonably soon after the act or event that was recorded.

23.           Attached as Exhibit 1-D to my affidavit is a true and correct copy of the 2010 IADC
              Drilling Contract between Nabors and Penn Virginia MC Energy, LLC, and attached as
              Exhibit 1-E is a true and correct copy of the portion of the IADC contract titled
              "Contractors Special Provisions." These records are kept by Nabors Industries, Inc. in the
              regular course and scope of business, and it was the regular course of business ofNabors
              Industries, Inc. for an employee or representative of Nabors Industries, Inc., with
              knowledge of the act or event that was recorded, to make these records or to transmit the
              information to be included in these records. These records were made at or near the time
              or reasonably soon after the act or event that was recorded.

24..          The records attached as Exhibits 1-F, 1-G, 1-H, and 1-I are true and correct copies of
              records that are kept by NCPS in the regular course and scope of business, and it was the
              regular course of business of NCPS for an employee or representative of NCPS, with
              knowledge of the act or event that was recorded, to make these records or to transmit the
              information to be included in these records. These records were made at or near the time
              the act or event that was recorded."




              Sworn to and subscribed before me by Keith Nfchoison on the /t;.,.aay of June, 2015.

                                                                    ~~·r;;_
                                                   Notary Puhli····· in and for the State of Texas
       .. ~       MARY D. HOISINGTON               My Commission expires: llltHjtfJ()Itf
         !     Notary Public. State of Texas
          -      My Commission Expires
                    . _Mav os. 2018_
                                                                                                                  7/24/2014 4:01:22 PM
                                                                                             Chris Daniel - District Clerk Harris County
                                                                                                                 Envelope No. 1937678
                                                                                                             By: Cassandra Durisseau


                                               CAUSE NO. - - - - - - - -


ALFREDO DE LA GARZA,                                               §      IN THE DISTRICT COURT OF
INDIVIDUALLY and AS NEXT FRIEND                                    §
FORREDACTED            and                                         §
REDACTED               minors                                      §
                                                                   §
v.                                                                 §      HARRISCOUNTY,TEXAS
                                                                   §
PENN VIRGINIA OIL & GAS, L.P., PENN                                §
VIRGINIA OIL & GAS GP LLC,                                         §
MIKE FERGUSON, TRIFECTA OILFIED                                    §
SERVICES, LLC, CUDD PRESSURE                                       §
CONTROL, INC., and ROYWELL                                         §      - - - JUDICIAL DISTRICT
SERVICES, INC.                                                     §


                                         PLAINTIFFS' ORIGINAL PETITION


TO THE HONORABLE JUDGE OF SAID COURT:

           COME NOW, Alfredo De La Garza, Individually and as Next Friend for REDACTE La
                                                                                                    D
REDACTED                                        minors, hereinafter referred to collectively as "Plaintiffs," and

file this their Original Petition complaining of Penn Virginia Oil & Gas, L.P., Penn Virginia Oil

& Gas GP LLC, Mike Ferguson, Trifecta Oilfield Services, LLC, Cudd Pressure Control, Inc.,

and Roywell Services, Inc., hereinafter referred to collectively as "Defendants," and for cause of

action would respectfully show unto the Court as follows:

1. 00      Discovery Control Plan

1.01       This case will be governed by Discovery Control Plan III as set forth in Rule 190.4 of the

Texas Rules of Civil Procedure.

2.00       Jurisdiction and Venue

2.01       Plaintiff Alfredo De La Garza, Individually and as Next Friend for REDACTED

                                        , is a resident of the State of Texas who resides at 6510 E. Business 83,


                                                                                                                  EXHIBIT
Plaintiffs' Original Petition- Page 1

                                                                                                         I            ·r
Mercedes, Texas 78570. The last three digits of his driver's license are 866 and the last three

digits of his social security number are 964.

2.02       Plaintiffs REDACTED                                     are minor children of Plaintiff

Alfredo De La Garza. Plaintiff Alfredo De La Garza is the natural father of both minor children.

2.03       Defendant Penn Virginia Oil & Gas, L.P. is a domestic limited partnership organized

under the laws of the State of Texas with its principal place of business in Houston, Harris

County, Texas. This Defendant can be served by serving its registered agent, CT Corporation

System at 1999 Bryan Street, Suite 900, Dallas, Texas 75201.

2.04       Defendant Penn Virginia Oil & Gas GP LLC is a foreign limited liability company

organized under the laws of the State of Delaware with its principal place of business in

Houston, Harris County, Texas. This Defendant maintains such minimum contacts with the

State of Texas so as to subject it to the jurisdiction of the laws of the State of Texas. This

Defendant can be served by serving its registered agent, CT Corporation System at 1999 Bryan

Street, Suite 900, Dallas, Texas 75201.

2.05       Defendant Mike Ferguson is an individual who is a nonresident of Texas whose residence

is located at 16415 Highway 74, Purcell, Oklahoma 73080. This Defendant maintains such

minimum contacts with the State of Texas so as to subject him to the jurisdiction of the laws of

the State of Texas. This Defendant was conducting business in this state at the time of the

incident made the basis of this suit pursuant to Texas Civil Practice & Remedies Code

§17.042(2). The Texas Secretary of State, P.O. Box 12079, Austin, Texas 78711-2079, is the

agent for service pursuant to Texas Civil Practices & Remedies Code§ 17.044.

2.06       Defendant Trifecta Oilfield Services, LLC is a domestic limited liability company

organized under the laws of the State of Texas with its principal place of business in Corrigan,




Plaintiffs' Original Petition- Page 2
Polk County, Texas. This Defendant can be served by serving its registered agent, Melba Locke

at 608 North Home Street, Corrigan, Texas 75939.

2. 07      Defendant Cudd Pressure Control, Inc. is a foreign corporation incorporated under the

laws of the State of Delaware with its principal place of business in The Woodlands,

Montgomery County, Texas. This Defendant maintains such minimum contacts with the State of

Texas so as to subject it to the jurisdiction of the laws of the State of Texas. This Defendant can

be served by serving its registered agent, Prentice Hall Corporation, 211 E. 7th Street, Suite 620,

Austin, Texas 78701-3218.

2.08       Defendant Roywell Services, Inc. is a domestic corporation organized under the laws of

the State of Texas with its principal place of business in Bellaire, Harris County, Texas. This

Defendant can be served by serving its registered agent, John D. Mclain at 5630 Cheena,

Houston, Texas 77096.

2.09       Venue is proper in Harris County, Texas, because Defendants Peim Virginia Oil & Gas,

L.P. and Defendant Roywell Services, Inc.'s principal places of business in this state are located

in Harris County, Texas.

3.00       Statement of Facts

3. 01      On April 29, 2014, Plaintiff Alfredo De La Garza was an employee of Nabors

Completion & Production Services Company working at Nabors Rig #1480, on the Wellhausen

well number one, outside of Shiner, Texas.

3.02       Defendant Penn Virginia Oil & Gas, L.P. is the operator of this lease.

3.03       Defendant Penn Virginia Oil & Gas, L.P. was directing the work being completed on the

well site.




Plaintiffs' Original Petition- Page 3
3.04       Defendant Mike Ferguson, the company representative for Defendant Penn Virginia Oil

& Gas, L.P, was on the location and acting in the        co~rse   and scope of his employment with

Defendant Penn Virginia Oil & Gas, L.P., and failed to perform completion services in a

reasonable manner.

3.05       Defendant Trifecta Oilfield Services, LLC was on location for pressure testing at the well

site. Defendant Trifecta Oilfield Services, LLC was operating equipment on the well site.

3.06       Defendant Cudd Pressure Control, Inc. was operating snubbing equipment on the well

site.

3.07       Defendant Roywell Services, Inc. provided the equipment used in completion services.

Defendant Roywell Services, Inc. failed to act in a reasonable manner in the services provided.

3.08       Defendants were conducting completion operations on the well. Defendants failed to

perform the completion and related services safely. A line attached to the choke manifold "blew

out," causing serious and permanent injuries to Plaintiff Alfredo De La Garza.

3.09       As a result of the serious, permanent and disabling injuries to Plaintiff Alfredo De La

Garza, minor Plaintiffs REDACTED                                             have suffered a loss of

consortium.

3.1 0      Plaintiff Alfredo De La Garza was an invitee on said lease.

3.11       Defendant Penn Virginia Oil & Gas, L.P. failed to keep the premises in a reasonable safe

condition, failed to make safe any defects, failed to maintain the well in a reasonably safe

condition, failed to direct the services being performed on the well in a reasonable manner and

failed to give an adequate warning of any dangers.

3.12       Defendant Penn Virginia Oil & Gas, L.P. was negligent in conducting the completion

operations in an unsafe manner.




Plaintiffs' Original Petition- Page 4
3.13       Defendant Penn Virginia Oil & Gas GP LLC is the sole general partner of Defendant

Penn Virginia Oil & Gas, L.P.

3.14       Defendants Penn Virginia Oil & Gas, L.P. and/or Penn Virginia Oil & Gas GP LLC are

vicariously liable for the acts and/or omissions of their employees, agents, servants and

representatives, including Defendant Mike Ferguson.

3.15       Defendant Mike Ferguson was negligent.

3.16       Defendant Trifecta Oilfield Services, LLC was negligent in its operations conducted in

connection with the completion activities for the well.

3.17       Defendant Trifecta Oilfield Services, LLC is vicariously liable for the acts and/or

omissions of its employees, agents, servants and representatives.

3.18       Defendant Cudd Pressure Control, Inc. was negligent in its operations conducted in

connection with the completion activities for the well.

3.19       Defendant Cudd Pressure Control, Inc. is vicariously liable for the acts and/or omissions

of its employees, agents, servants and representatives.

3.20       Defendant Roywell Services, Inc. was negligent.

3.21       Defendant Roywell Services, Inc. is vicariously liable for the acts and/or omissions of its

employees, agents, servants and representatives.

3 .22      Plaintiff Alfredo De La Garza is the natural father of REDACTED

REDACT
ED
4.00       Causes of Action

4.01       The above-referenced incident occurred as a proximate result of Defendants' negligence.

This negligence was a proximate cause of the occurrence in question and of Plaintiffs' resulting

injuries and damages.




Plaintiffs' Original Petition - Page 5
5.00       Damages

5.01       As a proxin1ate result of Defendants' breach of duty, Plaintiffs have sustained severe

damages in an1ounts ·within the 1ninimU1n jurisdictionalli1nits of the Court.

5.02       Plaintiffs are seeking n1onetary relief over $1,000,000.00.

6.00       Dentand For Trial By Jury

6.01       Pursuant to Rule 216 of the Texas Rules of Civil Procedure, Plaintiffs request a trial by

jury as to all issues of fact presented herein.

           WHEREFORE,                   PREMISES   CONSIDERED,      Plaintiffs   Alfredo   De La Garza,

Individually and as Next Friend for REDACTED                                                     minors,

respectfully pray that they be permitted recovery for the dan1ages as set forth above jointly and

severally against the Defendants, together with such pre-judgment ru1d post-judg1nent interest as

allowed by lav-v, for costs herein, and for such other relief to which they may be entitled, whether

in law or equity.

                                                      Respectfully subn1itted,


                                                      ·~

                                                      JOHN DAVID HART
                                                      State Bar #09147700

                                                      LAW OFFICES OF JOHN DAVID HART
                                                      Wells Fargo Tower
                                                      201 Main Street, Suite 1720
                                                      Fort \¥orth, Texas 76102
                                                      817/870-2102- Telephone
                                                      817/332-5858- Facsimile
                                                      johnhart(fyhartlaw. con1

                                                      ATTORNEY FOR PLAINTIFFS




Plaintiffs' Original Petition- Page 6
                                                                                                                     9/8/2014 2:07:26 PM
                                                                                               Chris Daniel - District Clerk Harris County
                                                                                                                   Envelope No. 2413129
                                                                                                                       By: Bonisha Evans



                                                         CAUSE NO. 2014-42519


ALFREDO DE LA GARZA,                                                  §       IN THE DISTRICT COURT OF
INDIVIDUALLY and AS NEXT FRIEND                                       §
FOR REDACTED            and                                           §
REDACTED              , minors                                        §
                                                                      §
v.                                                                    §       HARRIS COUNTY, TEXAS
                                                                      §
PENN VIRGINIA OIL & GAS, L.P., PENN                                   §
VIRGINIA OIL & GAS GP LLC,                                            §
MIKE FERGUSON, TRIFECTA OILFIED                                       §
SERVICES, LLC, CUDD PRESSURE                                          §
CONTROL, INC., ROYWELL                                                §       215TH JUDICIAL DISTRICT
SERVICES, INC., and OAKS PERSONNEL                                    §
SERVICES INC. d/b/a THE OAKS GROUP                                    §


                         PLAINTIFF'S FIRST AMENDED ORIGINAL PETITION


TO THE HONORABLE JUDGE OF SAID COURT:

           COMES NOW, Alfredo De La Garza, Individually and as Next Friend for REDACTED

REDACTED                                              , minors, and files this his First Amended Original Petition

complaining of Penn Virginia Oil & Gas, L.P ., Penn Virginia Oil & Gas GP LLC, Mike

Ferguson, Trifecta Oilfield Services, LLC, Cudd Pressure Control, Inc., Roywell Services, Inc.,

and Oaks Personnel Services, Inc. d/b/a The Oaks Group, hereinafter referred to collectively as

"Defendants," and for cause of action would respectfully show unto the Court as follows:

1.00       Discovery Control Plan

1.01       This case will be governed by Discovery Control Plan III as set forth in Rule 190.4 of the

Texas Rules of Civil Procedure.

2.00       Jurisdiction and Venue

2.01       Plaintiff Alfredo De La Garza, Individually and as Next Friend for REDACTED

REDACTED                                is a resident of the State of Texas who resides at 6510 E. Business 83,

                                                                                                               EXHIBIT
Plaintiff's First Amended Original Petition- Page I

                                                                                                      I G
Mercedes, Texas 78570. REDACTED



2.02       REDACTED                                     are minor children of Plaintiff Alfredo De

La Garza. Plaintiff Alfredo De La Garza is the natural father of both minor children.

2.03       Defendant Penn Virginia Oil & Gas, L.P. is a domestic limited partnership organized

under the laws of the State of Texas with its principal place of business in Houston, Harris

County, Texas. This Defendant has answered and is before the Court.

2.04       Defendant Penn Virginia Oil & Gas GP LLC is a foreign limited liability company

organized under the laws of the State of Delaware with its principal place of business in

Houston, Harris County, Texas. This Defendant maintains such minimum contacts with the

State of Texas so as to subject it to the jurisdiction of the laws of the State of Texas. This

Defendant has answered and is before the Court.

2.05       Defendant Mike Ferguson is an individual who is a nonresident of Texas whose residence

is located at 16415 Highway 74, Purcell, Oklahoma 73080. This Defendant maintains such

minimum contacts with the State of Texas so as to subject him to the jurisdiction of the laws of

the State of Texas. This Defendant was conducting business in this state at the time of the

incident made the basis of this suit pursuant to Texas Civil Practice & Remedies Code

§ 17.042(2). This Defendant is not yet before the Court.

2.06       Defendant Trifecta Oilfield Services, LLC is a domestic limited liability company

organized under the laws of the State of Texas with its principal place of business in Corrigan,

Polk County, Texas. This Defendant is not yet before the Court.

2.07       Defendant Cudd Pressure Control, Inc. is a foreign corporation incorporated under the

laws of the State of Delaware with its principal place of business in The Woodlands,




Plaintiff's First Amended Original Petition- Page 2
Montgomery County, Texas. This Defendant maintains such minimum contacts with the State of

Texas so as to subject it to the jurisdiction of the laws of the State of Texas. This Defendant has

answered and is before the Court.

2.08       Defendant Roywell Services, Inc. is a domestic corporation organized under the laws of

the State of Texas with its principal place of business in Bellaire, Harris County, Texas. This

Defendant is not yet before the Court.

2.09       Defendant Oaks Personnel Services, Inc. d/b/a The Oaks Group, hereinafter referred to as

"The Oaks Group", is a domestic corporation organized under the laws of the State of Texas with

its principal place of business in Houston, Harris County, Texas. This Defendant may be served

through its registered agent, Corporation Service Company, 800 Brazos Street, Austin, Texas

78701.

2.10       Venue is proper in Harris County, Texas, because Defendants Penn Virginia Oil & Gas,

L.P., Defendant Roywell Services, Inc., and Defendant The Oaks Group's principal places of

business in this state are located in Harris County, Texas.

3.00       Statement of Facts

3.01       On April 29, 2014, Plaintiff Alfredo De La Garza was an employee of Nabors

Completion & Production Services Company working at Nabors Rig #1480, on the Wellhausen

A, outside of Shiner, Texas.

3.02       Defendant Penn Virginia Oil & Gas, L.P. is the operator of this lease.

3.03       Defendant Penn Virginia Oil & Gas, L.P. was directing the work being completed on the

well site.

3.04       Defendant Mike Ferguson, the company representative for Defendant Penn Virginia Oil

& Gas, L.P, was on the location and acting in the course and scope of his employment with




Plaintiff's First Amended Original Petition- Page 3
Defendant Penn Virginia Oil & Gas, L.P. and Defendant The Oaks Group, and failed to perform

completion services in a reasonable manner.

3.05       Defendant Trifecta Oilfield Services, LLC was on location for pressure testing at the well

site. Defendant Trifecta Oilfield Services, LLC was operating equipment on the well site.

3.06       Defendant Cudd Pressure Control, Inc. was operating snubbing equipment on the well

site.

3.07       Defendant Roywell Services, Inc. provided the equipment used in completion services.

Defendant Roywell Services, Inc. failed to act in a reasonable manner in the services provided.

3.08       Defendant The Oaks Group provided employee staffing to Defendant Penn Virginia Oil

& Gas, L.P. for services in connection with the completion operations on the Welhausen A in

April2014.

3.09       Defendants were conducting completion operations on the well. Defendants failed to

perform the completion and related services safely. A line attached to the choke manifold "blew

out," causing serious and permanent injuries to Plaintiff Alfredo De La Garza.

3.1 0      As a result of the serious, permanent and disabling injuries to Plaintiff Alfredo De La

Garza, minor Plaintiffs REDACTED                                             have suffered a loss of

consortium.

3.11       Plaintiff Alfredo De La Garza was an invitee on said lease.

3.12       Defendant Penn Virginia Oil & Gas, L.P. failed to keep the premises in a reasonable safe

condition, failed to make safe any defects, failed to maintain the well in a reasonably safe

condition, failed to direct the services being performed on the well in a reasonable manner and

failed to give an adequate warning of any dangers.




Plaintiff's First Amended Original Petition- Page 4
3.13       Defendant Penn Virginia Oil & Gas, L.P. was negligent in conducting the completion

operations in an unsafe manner.

3.14       Defendant Penn Virginia Oil & Gas GP LLC is the sole general partner of Defendant

Penn Virginia Oil & Gas, L.P.

3.15       Defendants Penn Virginia Oil & Gas, L.P. and/or Penn Virginia Oil & Gas GP LLC are

vicariously liable for the acts and/or omissions of their employees, agents, servants and

representatives, including Defendant Mike Ferguson and Defendant The Oaks Group.

3.16       Defendant Mike Ferguson was negligent.

3.17       Defendant Trifecta Oilfield Services, LLC was negligent in its operations conducted in

connection with the completion activities for the well.

3.18       Defendant Trifecta Oilfield Services, LLC is vicariously liable for the acts and/or

omissions of its employees, agents, servants and representatives.

3.19       Defendant Cudd Pressure Control, Inc. was negligent in its operations conducted in

connection with the completion activities for the well.

3.20       Defendant Cudd Pressure Control, Inc. is vicariously liable for the acts and/or omissions

of its employees, agents, servants and representatives.

3.21       Defendant Roywell Services, Inc. was negligent.

3.22       Defendant Roywell Services, Inc. is vicariously liable for the acts and/or omissions of its

employees, agents, servants and representatives.

3.23       Defendant The Oaks Group is vicariously liable for the acts and/or omissions of its

employees, agent, servants, and representatives.

3.24       Plaintiff Alfredo De La Garza is the natural father of REDACTED




Plaintiff's First Amended Original Petition- Page 5
4.00       Causes of Action

4.01       The above-referenced incident occurred as a proximate result of Defendants' negligence.

This negligence was a proximate cause of the occurrence in question and of Plaintiffs resulting

injuries and damages.

5.00       Damages

5.01       As a proximate result of Defendants' breach of duty, Plaintiff has sustained severe

damages in amounts within the minimum jurisdictional limits of the Court.

5.02       Plaintiff is seeking n1onetary relief over $1,000,000.00.

6.00       Demand For Trial By Jury

6.01       Pursuant to Rule 216 of the Texas Rules of Civil Procedure, Plaintiff requests a trial by

jury as to all issues of fact presented herein.

           WHEREFORE, PREMISES CONSIDERED, Plaintiff Alfredo De La Garza, Individually

and as Next Friend for REDACTED                                                 , minors, respectfully prays

that he be permitted recovery for the damages as set forth above jointly and severally against the

Defendants, together with such pre-judgment and post-judgment interest as allowed by law, for

costs herein, and for such other relief to which they may be entitled, whether in law or equity.


                                                      Respectfully submitted,



                                                      JOlfNDAVID HART
                                                      State Bar #09147700
                                                      LAW OFFICES OF JOHN DAVID HART
                                                      Wells Fargo Tower
                                                      201 Main Street, Suite 1720
                                                      Fort Worth, Texas 76102
                                                      817/870-2102- Telephone
                                                      817/332-5858- Facsimile
                                                      j ohnhart@hartlaw. com
                                                      ATTORNEY FOR PLAINTIFF


Plaintiff's First Amended Original Petition- Page 6
                                               CERTIFICATE OF SERVICE

       The undersigned hereby certifies that a copy of the above and foregoing instrument has
been forwarded on this the 8th day of September 2014 to the following attorneys of records
pursuant to the Texas Rules of Civil Procedure:


J.J. Knauff                         VIA CMRRR & FACSIMILE
THE MILLER LAW FIRM
Turtle Creek Centre
3811 Turtle Creek Blvd., Suite 1950
Dallas, Texas 75219

Douglas E. Dilley                                     VIA CMRRR & FACSIMILE
Rella V. Scheuerman
Miguel E. Dilley
DILLEY LAW FIRM, P.C.
635 S. Presa
San Antonio, Texas 78210

Benjamin A. Escobar, Jr.        VIA CMRRR & FACSIMILE
BritT. Brown
BEIRNIE, MAYNARD & PARSONS, L.L.P.
1300 Post Oak Blvd., Suite 2500
Houston, Texas 77056



                                                          JOHN DAVID HART




Plaintiff's First Amended Original Petition- Page 7
                                                                                                              10/1/2014 3:43:53 PM
                                                                                         Chris Daniel - District Clerk Harris County
                                                                                                             Envelope No. 2688531
                                                                                                                By: Deandra Mosley
                                                                                                       Filed: 10/1/2014 3:43:53 PM

                                                      CAUSE NO. 2014-42519


ALFREDO DE LA GARZA,                                             §      IN THE DISTRICT COURT OF
INDIVIDUALLY and AS NEXT FRIEND                                  §
FOR REDACTED            and                                      §
REDACTED              , minors                                   §
                                                                 §
v.                                                               §      HARRIS COUNTY, TEXAS
                                                                 §
PENN VIRGINIA OIL & GAS, L.P., PENN                              §
VIRGINIA OIL & GAS GP LLC,                                       §
MIKE FERGUSON, TRIFECTA OILFIED                                  §
SERVICES, LLC, CUDD PRESSURE                                     §
CONTROL, INC., ROYWELL                                           §      215TH JUDICIAL DISTRICT
SERVICES, INC., and OAKS PERSONNEL                               §
SERVICES INC. d/b/a THE OAKS GROUP                               §


                     PLAINTIFF'S SECOND AMENDED ORIGINAL PETITION



TO THE HONORABLE JUDGE OF SAID COURT:


          COMES NOW, Alfredo De La Garza, Individually and as Next Friend for REDACTED

REDACTED                                         minors, and files this his Second Amended Original Petition

complaining of Penn Virginia Oil & Gas, L.P ., Penn Virginia Oil & Gas GP LLC, Mike

Ferguson, Trifecta Oilfield Services, LLC, Cudd Pressure Control, Inc., Roywell Services, Inc.,

and Oaks Personnel Services, Inc. d/b/a The Oaks Group, hereinafter referred to collectively as

"Defendants," and for cause of action would respectfully show unto the Court as follows:

1.00      Discovery Control Plan

1.01      This case will be governed by Discovery Control Plan III as set forth in Rule 190.4 of the

Texas Rules of Civil Procedure.




                                                                                                           EXHIBIT

Plaintiffs Second Amended Original Petition- Page 1
                                                                                                  I H
2.00      Jurisdiction and Venue

2.01      Plaintiff Alfredo De La Garza, Individually and as Next Friend for REDACTED

REDACTED                            , is a resident of the State of Texas who resides at 6510 E. Business 83,

Mercedes, Texas 78570. REDACTED



2.02      REDACTED                                               are minor children of Plaintiff Alfredo De

La Garza. Plaintiff Alfredo De La Garza is the natural father of both minor children.

2.03      Defendant Penn Virginia Oil & Gas, L.P. is a domestic limited partnership organized

under the laws of the State of Texas with its principal place of business in Houston, Harris

County, Texas. This Defendant has answered and is before the Court.

2.04      Defendant Penn Virginia Oil & Gas GP LLC is a foreign limited liability company

organized under the laws of the State of Delaware with its principal place of business in

Houston, Harris County, Texas. This Defendant maintains such minimum contacts with the

State of Texas so as to subject it to the jurisdiction of the laws of the State of Texas. This

Defendant has answered and is before the Court.

2.05      Defendant Mike Ferguson is an individual who is a nonresident of Texas whose home is

located at 16415 Highway 74, Purcell, Oklahoma 73080. This Defendant maintains such

minimum contacts with the State of Texas so as to subject him to the jurisdiction of the laws of

the State of Texas. This Defendant was conducting business in this state at the time of the

incident made the basis of this suit pursuant to Texas Civil Practice & Remedies Code

§17.042(2). Defendant's name and address ofhis home was provided to the Texas Secretary of

State for execution of service of process, pursuant to Texas Civil Practice & Remedies Code

§ 17.045. This Defendant is not yet before the Court.




Plaintiffs Second Amended Original Petition- Page 2
2.06      Defendant Trifecta Oilfield Services, LLC is a domestic limited liability company

organized under the laws of the State of Texas with its principal place of business in Corrigan,

Polk County, Texas. This Defendant was served through its registered agent Melba Locke at 608

North Home Street, Corrigan, Texas. This Defendant is not yet before the Court.

2.07      Defendant Cudd Pressure Control, Inc. is a foreign corporation incorporated under the

laws of the State of Delaware with its principal place of business in The Woodlands,

Montgomery County, Texas. This Defendant maintains such minimum contacts with the State of

Texas so as to subject it to the jurisdiction of the laws of the State of Texas. This Defendant has

answered and is before the Court.

2.08      Defendant Roywell Services, Inc. is a domestic corporation organized under the laws of

the State of Texas with its principal place of business in Bellaire, Harris County, Texas. This

Defendant can be served by serving its registered agent, John D. Mclain at 5630 Cheena,

Houston, Texas 77096. This Defendant is not yet before the Court.

2.09      Defendant Oaks Personnel Services, Inc. d/b/a The Oaks Group, hereinafter referred to as

"The Oaks Group", is a domestic corporation organized under the laws of the State of Texas with

its principal place of business in Houston, Harris County, Texas. This Defendant may be served

through its registered agent, Luis Acosta, 11511 Katy Freeway, Suite 605, Houston, Texas

77079. This Defendant is not yet before the Court.

2.10      Venue is proper in Harris County, Texas, because Defendants Penn Virginia Oil & Gas,

L.P., Defendant Roywell Services, Inc., and Defendant The Oaks Group's principal places of

business in this state are located in Harris County, Texas.




Plaintiff's Second Amended Original Petition- Page 3
3.00      Statement of Facts

3.01      On April 29, 2014, Plaintiff Alfredo De La Garza was an employee of Nabors

Completion & Production Services Company working at Nabors Rig #1480, on the Welhausen

A, outside of Shiner, Texas.

3.02      Defendant Penn Virginia Oil & Gas, L.P. is the operator of this lease.

3.03      Defendant Penn Virginia Oil & Gas, L.P. was directing the work being completed on the

well site.

3.04      Defendant Mike Ferguson, the company representative for Defendant Penn Virginia Oil

& Gas, L.P, was on the location and acting in the course and scope of his employment with

Defendant Penn Virginia Oil & Gas, L.P. and Defendant The Oaks Group, and failed to perform

completion services in a reasonable manner.

3.05      Defendant Trifecta Oilfield Services, LLC was on location for pressure testing at the well

site. Defendant Trifecta Oilfield Services, LLC was operating equipment on the well site.

3.06      Defendant Cudd Pressure Control, Inc. was operating snubbing equipment on the well

site.

3.07      Defendant Roywell Services, Inc. provided the equipment used in completion services.

Defendant Roywell Services, Inc. failed to act in a reasonable manner in the services provided.

3.08      Defendant The Oaks Group provided employee staffing to Defendant Penn Virginia Oil

& Gas, L.P. for services in connection with the completion operations on the Welhausen A in

April2014.

3.09      Defendants were conducting completion operations on the well. Defendants failed to

perform the completion and related services safely. A line attached to the choke manifold "blew

out," causing serious and permanent injuries to Plaintiff Alfredo De La Garza.




Plaintiff's Second Amended Original Petition- Page 4
3.10      As a result of the serious, permanent and disabling injuries to Plaintiff Alfredo De La

Garza, minor Plaintiffs REDACTED                                           have suffered a loss of

consortium.

3.11      Plaintiff Alfredo De La Garza was an invitee on said lease.

3.12      Defendant Penn Virginia Oil & Gas, L.P. failed to keep the premises in a reasonable safe

condition, failed to make safe any defects, failed to maintain the well in a reasonably safe

condition, failed to direct the services being performed on the well in a reasonable manner and

failed to give an adequate warning of any dangers.

3.13      Defendant Penn Virginia Oil & Gas, L.P. was negligent in conducting the completion

operations in an unsafe manner.

3.14      Defendant Penn Virginia Oil & Gas GP LLC is the sole general partner of Defendant

Penn Virginia Oil & Gas, L.P.

3.15      Defendants Penn Virginia Oil & Gas, L.P. and/or Penn Virginia Oil & Gas GP LLC are

vicariously liable for the acts and/or omissions of their employees, agents, servants and

representatives, including Defendant Mike Ferguson and Defendant The Oaks Group.

3.16      Defendant Mike Ferguson was negligent.

3.17      Defendant Trifecta Oilfield Services, LLC was negligent in its operations conducted in

connection with the completion activities for the well.

3.18      Defendant Trifecta Oilfield Services, LLC is vicariously liable for the acts and/or

omissions of its employees, agents, servants and representatives.

3.19      Defendant Cudd Pressure Control, Inc. was negligent in its operations conducted in

connection with the completion activities for the well.




Plaintiffs Second Amended Original Petition -Page 5
3.20      Defendant Cudd Pressure Control, Inc. is vicariously liable for the acts and/or omissions

of its employees, agents, servants and representatives.

3.21      Defendant Roywell Services, Inc. was negligent.

3.22      Defendant Roywell Services, Inc. is vicariously liable for the acts and/or omissions of its

employees, agents, servants and representatives.

3.23      Defendant The Oaks Group is vicariously liable for the acts and/or omissions of its

employees, agent, servants, and representatives.

3.24      Plaintiff Alfredo De La Garza is the natural father of REDACTED



4.00      Causes of Action

4.01      The above-referenced incident occurred as a proximate result of Defendants' negligence.

This negligence was a proximate cause of the occurrence in question and of Plaintiffs resulting

injuries and damages.

5.00      Damages

5.01      As a proximate result of Defendants' breach of duty, Plaintiff has sustained severe

damages in amounts within the minimum jurisdictional limits of the Court.

5.02      Plaintiff is seeking monetary relief over $1,000,000.00.

6.00      Demand For Trial By Jury

6.01      Pursuant to Rule 216 of the Texas Rules of Civil Procedure, Plaintiff requests a trial by

jury as to all issues of fact presented herein.

          WHEREFORE, PREMISES CONSIDERED, Plaintiff Alfredo De La Garza, Individually

and as Next Friend for REDACTED                                          , minors, respectfully prays

that he be permitted recovery for the damages as set forth above jointly and severally against the




Plaintiffs Second Amended Original Petition- Page 6
Defendants, together with such pre-judgment and post-judgment interest as allowed by law, for

costs herein, and for such other relief to which they may be entitled, whether in law or equity.


                                                       Respectfully submitted,




                                                       State Bar #09147700
                                                       LAW OFFICES OF JOHN DAVID HART
                                                       Wells Fargo Tower
                                                       201 Main Street, Suite 1720
                                                       Fort Worth, Texas 76102
                                                       817/870-2102- Telephone
                                                       817/332-5858- Facsimile
                                                       j ohnhart@hartlaw.com
                                                       ATTORNEY FOR PLAINTIFF




Plaintiff's Second Amended Original Petition- Page 7
                                              CERTIFICATE OF SERVICE

       The undersign~d hereby ~ertifies that a copy of the above and ~ore going instrument has
been forwarded on this the ~,.,- day of October, 2014 to the following attorneys of records
pursuant to the Texas Rules of Civil Procedure:


Mr. J.J. Knauff                     VIA CMRRR & FACSIMILE
The Miller Law Firm
Turtle Creek Centre
3811 Turtle Creek Blvd., Suite 1950
Dallas, Texas 75219

Mr. Douglas E. Dilley                                   VIA CMRRR & FACSIMILE
Ms. Hella V. Scheuerman
Mr. Miguel E. Dilley
Dilley Law Firm, P. C.
635 S. Presa
San Antonio, Texas 7821 0

Mr. Benjamin A. Escobar, Jr.      VIA CMRRR & FACSIMILE
Mr. BritT. Brown
Beirne, Maynard & Parsons, L.L.P.
1300 Post Oak Blvd., Suite 2500
Hou~o~Texas77056




Plaintiff's Second Amended Original Petition - Page 8
                                    APPLICATION FOR
                              HOURLY AND DAILY EMPLOYMENT



 Business
 Unit:

 ~~~D~~Jr_D~~~~~~~-tT:P-.~~J:;;!~~ g~::~e~-~~crg~:6~1fr~~~A~~-~~~-~~~~~fg::~:cis~-~~ ~.·sA~~~-~~~r!_._]
[RELATED                                                                                                  0.8  .
                                                                                                            .R.ED.
         F~Q.TO~~:~-····  _          ---~--~-···----·-··"--............--·-·-----~----~··-····-··-···--····- ··---····-····--~.




                                                                                       Other (specify}



                                                                                                                      EXHIBIT

                                                                                                                 II
 HR·105 (0i/07/1i)


                                                                                                         NCPS 000855
                                                 APPLICATION FOR HOURLY AND DAILY EMPLOYMENT
                                                                                               PAGE2




                                                                               Telephone No.




  i




 3.




High Schoof

Co!!ege/Univ .
                                          -
             .............................. ..




HR-105 {01/07/11)


                                                                               NCPS 000856
                                                          APPLICATION FOR HOURLY AND DAILY EMPLOYMENT
                                                                                                 PAGE2




       lrnm                                                 the nature
 t.




High Schoo!                                                              89101112
College/Univ.
         -~~~-~~~-------·--·---·~········~·········   "



Grad. School                                                              1234




HR-105 (01/07/1 i)


                                                                                        NCPS 000857
                                                    APPLICATION FOR HOURLY AND DAILY EMPLovuct.tT
                                                                                                                                       PAGE3




I declare that the statements contained in this application are correct and understand that withholding information
or making a false statement in this application and information submitted therewith or at any time during the
application and pre~employment process wll! be the basis for my application not to be considered and/or
dismissal. I authorize all employers, educators and other firms or person named herein to provide the Company
with information regarding my education, employment and medical history and release all such individuals or
entities\ from all liability for any damages that may result from furnishing information regarding me.
·-~~:\~}"~-·~······ ... - INITIALS
I understand that this application does not obligate the company to offer me employment or to hire me. I further
understand that if I am employed by the Company, my employment wHl be on an "at will" basis and may be
terminated by the Company at any time with or without cause or notice. If I am employed l understand that I will
wear the prescribed personal protective equipme·n·-·t·a.tn,d...Y.w.iiil·l··-·a···.b....i. de.. b.. y. all Federal, State and Company procedures
and regulations white working for the Company. __ ·1,\s:::,t~ , _-·,~- _, · INITIALS

I acknowledge that a copy of the Company's Dispute Resolution Program was available for my review at the
location where I submitted this application. ! acknowledge and understand that I am required to adhere to the
Dispute Resolution Program and its requirements for submission of all claims to a process that may include
mediation and/or arbitration and that if I refuse to sign below that my application will not be considered for
employment I further understand that my employment application submission with the Company constitutes my
ac e t~.~ce .o.. f. . th. e... terms of this provision as a condition of employment consideration.
        L:::t··" , __ .           INITIALS

If ! am hired, I hereby agree to participate in the Company's Payroll Direct Deposit System for payment of
salaried/hourly employees and compl t he Payroll Direct Deposit Authorization Form to implement the Payroll
Direct Deposit System for my pay.                  ~ INITIALS


This application will be considered active for thirty (30) days.




HR-105 {01/07/11)



                                                                                                                    NCPS 000858
04/20/2015 MON 18:32                 FAX         444    John David Hart                                                                                  ~002/040




                                         GALLOWAY
                                         JOHNSON

        GjiBs                            TOMPKINS
                                         BURR AND
                                         SMI'TH


                                            Texas • Loul&lan(-'1 .. MJeGOI,II'I • Miesleslppl   il   Alabama • Florida • Georgia

       TaOMAS SMITH  J.                                                                                                  1301 McKinney Street, Suite 1400
       Shareholder                                                                                                               HolJBton, Texas 77010
       Licent~ed in Louisiana and •rexaa
                                                                                                                                      Tel: 713-59~700
       ll!mith@g.tlll:l\vn.yjQh~on.cQm
                                                                            April20, 2015                                              Fax:   713..S99~0777

       KELLY C. HARTMANN                                                                                                                 www.gjtbs.t:!:nM
       Directol"
       Licclllilcd in 'I'exQ.S ami Co~OfAOO
       k.hn.rtmnnn@gRI1ow1\yjohllllon.com

       ALEXlS B. HES'I'EJI
       Aaaodate
       lthcs.~x@gallowayjohmion.c:om
       J.~iecnsed in Texas


       Via Facsimile: 817-332-5858
       Jolm David Hart
       LAW OFFICES OF JOHN DAVID HART
       Wells Fargo Tower
       201 Main Street, Suite 1720
       Fort Worth, Texas 76102

                    Re:          Cause No. 14-06-53276-CV; Alfredo De La Garza, Individually and as Next
                                 Friend of REDACTED                                                            ] a
                                 Minor Child; in the 215 h Judicial District Court of Harris County~ Texas; GJTB S
                                                        1

                                 File No. H04177-876.

       Dear Mr. Hart:

                    Please accept this Notice of Arbitration on behalf of Defendants Penn Virginia Oil &
       Gas, L.P. and Penn Virginia Oil & Gas GP LLC (collectively, "PVOG,) il1 the above referenced
       matter.

                Mr. Alfredo De La Garza contractually obligated himself to submit all claims relating to
       or arising out of his employment with Nabors Cornpletion & Production Services, Co. ("NCPS")
       to binding arbitration pursuant to the Nabors Dispute Resolution Program ("DRP"), Upon
       receiving a copy of the DRP, Mr. De La Garza signed an acknowledgment~ which specifically
       states, '~I have received a copy of the Nabors Dispute Resolution Program ... By my signature
       below, I acknowledge and understand that I am required to adhere to the Dispute Resolution
       Program and its requirement for submission of all claims to a process that may include mediation
       and/or arbitration.u We have attached a copy of the DRP as well as documents executed by Mr.
       De La Garza for your review.

               In 2008, Penn Virginia Oil & Gas, L.P. elected into the DRP on its behalf and on behalf
       of its subsidiary, parent, and affiliated companies. We have attached documents reflecting as

                                                                                                                                              EXHIBIT

                                                                                                                                    1\J
04/20/2015 MON 18:33    FAX        4 44   John David Hart                                                         ~003/040




                       GALLOWAY
                       .JOHNSON

        Gj]Bs          TOMPKINI!li
                       f:UJtiiR AND
                       SMITH

                              Texas • Loulslena • Missouri • MI&Gieslppl • Alal:lama • Florlde.   111   Georgia
       Mr. John Hart
       Page2

       much for your reference. In doing so, PVOG became an HEiecting Entity" to the DRP such that
       Mr. De La Garza's claims against PVOG are subject to arbitration,

              The DRP provides a means for the "resolution of Disputes between the Company and the
       Company's present and fonner Employees." As you will see at page 2 of the DRP, the
       "Company" is defined to include Nabors Industries, Inc.~ its direct and indirect subsidiaries, and
       Electing Entities. Because NCPS is a subsidiary of Nabors Industries, Inc.t NCPS is part of the
       ~~company." Page 2 states further that parties that are Electing Entities to the DRP are also
       included in the definition of the "Company." Because PVOG is an Electing Entity to the DRPt it
       too is part of the ''Con1pany." Finally) the DRP defines "Disputeu as "all legal and equitable
       claims~ demands, and controversies ... whether in contract (or) tort. .. between persons bound by
       the Program ... or between a person bound by the Program and a person or entity otherwise
       entitled to (the P1·ogram's) benefits." The definition includes "any personal injury incurred .. ,in
       the course and scope of an Employee's employment."

               Because Mr. De La Garza, an employee of NCPS) has filed a claim against PVOG, an
       Electing Entity to the DRP, he has filed a claim against the ~'Company." Pursuant to his
       contractual agreement to submit such clahns to the DRP, Mr. De La Garza's clain1s against
       PVOG are subject to arbitration. The arbitration agreement between Nabors, its employees, and
       its employees' heirs and beneficiaries has been foWld valid on numerous occasions. E.g. Nabors
       Drilling USA, LP v. Carpenter, 198 S.W.3d 240, 249 (Tex. App.-San Antonio 2006, orig.
       proceeding). Most recently; the San Antonio Fourth Court of Appeals found that the
       beneficiaries of a deceased Nabors ernployee were bound by the decedent's agreement to
       arbitrate pursuant to Nabors' DRP. Nabors Drilling USA, LP v. Pena, 385 S.W.3d 103 (Tex.
       App.-San Antonio 20 12).

                It is undisputed that Mr. De La Garzat as an NCPS employee, agreed to be botu1d by the
       DRP and to submit all claims against the Company to arbitration. There is no question that
       PVOG~ as an Electing Entity, is a member of the Company and is, therefore, entitled to the
       bene·fits of the DRP. Thls lawsuit clearly arises out of Mr. De La Garza's employment with
       NCPS and he has filed a claim against the Company. Therefore, the DRP is applicable to this
       matter. Accordingly, PVOG fonnally requests that you dismiss the present civil suit against it
       and initiate the claim in arbitration. Should you fail to voluntarily do so., we are prepared to
       proceed with a Motion to Compel Arbitration and will seek to abate the claims against PVOG
       pending resolution of the Motion to CompeL
04/20/2015 MON    18~33     FAX     44 4   John David Hart                                                               il!004/040



                           GALLOWAY
                           JOHNSON

        GjiBs              TOMPKINS
                           BURR AND
                           SMITH

                               Texas • Louisiana • M16sourl • MISsissippi • Alabama • Florida • Georgia
       Mr. .John Hart
       PageJ


                 We look forward to receiving your response. In the event you have any questions or
       concerns~   please do not hesitate to contact us.
                                                                       Sincerely,                 _______..

                                                                   ~-~---------                               ........


                                                                       Thomas J. Smith
                                                                       Kelly C. Hartmann
       TJS/KCH/ABH
       Attachments

       cc:       Via Ft1csimile
                 Benjamin A. Escobar, Jr.
                 Brit T. Brown

                 Via   Ft~csimile
               Conrad Bodden

               Via Facsinrile
               J. Javier Gutierrez
               Ana Laura Gutierrez

                 Via Facsinrile
               Douglas E. DiJley
               Hella V. Scheuerman
               Miguel E. Dilley
                                                     THE LAW OFFICES OF

                                                JOHN DAVID HART
                                                                                                           METRO:
         BOARD CERTIFIED                             WELLS FARGO TOWER                                  (817) 654-1922
TEXAS BOARD OF LEGAL SPECIALIZATION              201 MAIN STREET, SUITE 1720                                  FAX:
         CIVIL TRIAL LAW                          FORTWORTH, TEXAS 76102                                (817) 332-5858
    PERSONAL INJURY TRIAL LAw                     TELEPHONE(817)870-2102
                                              E-MAIL: JOHNHART@HARTLA W.COM


                                                      July 30, 2015



         VIAE-FILING
         Clerk of the Court
         215 1h Judicial District Court
         Harris County Civil Courthouse
         201 Caroline, 13 1h Floor
         Houston, Texas 77002

         Re:      Cause No. 2014-42519
                  Alfredo De La Garza, Individually and as Next Friend for REDACTED
                  REDACTED            a, minors v. Penn Virginia Oil & Gas, L.P., Penn Virginia Oil & Gas
                  GP LLC, Mike Ferguson, Trifecta Oilfield Services, LLC, Cudd Pressure Control, Inc.,
                  Roywell Services, Inc. and Oaks Personnel Services, Inc. d/b/a The Oaks Group

         Dear Clerk:

                Enclosed please find Plaintiffs' Response to Defendants, Penn Virginia Oil & Gas, L.P.
         and Penn Virginia Oil & Gas GP LLC's Motion to Compel Arbitration and to Abate.

                  I .am also providing a copy of this response to all counsel of record.




                                                         John David Hart


         JDH/cd
         Enclosure

         Cc:      VIA CMRRR & FACSIMILE                                   VIA CMRRR & FACSIMILE
                  Mr. Thomas J. Smith                                     Mr. BritT. Brown
                  Mr. Kelly C. Hartmann                                   Mr. Benjamin A. Escobar, Jr.
                  Ms. Alexis Butler Hester                                Beirne, Maynard & Parsons, L.L.P.
                  Galloway, Johnson, Tompkins,                            1300 Post Oak Blvd., Suite 2500
                  Burr & Smith                                            Houston, Texas 77056
                  1301 McKinney, Suite 1400
                  Houston, Texas 77010
Clerk of the Court
July 30, 2015
Page 2 of2



          VIA CMRRR & FACSIMILE
          Mr. J. Javier Gutierrez
          Ms. Ana Laura Gutierrez
          The Gutierrez Law Firm, Inc.
          700 East Third Street
          Alice, Texas 78332
                                        CAUSE NO. 2014-42519


ALFREDO DE LA GARZA,                                      §        IN THE DISTRICT COURT OF
INDIVIDUALLY and AS NEXT FRIEND                           §
FORREDACTED             and                               §
REDACTED              , minors                            §
                                                          §
v.                                                        §        HARRIS COUNTY, TEXAS
                                                          §
PENN VIRGINIA OIL & GAS, L.P., PENN                       §
VIRGINIA OIL & GAS GP LLC,                                §
MIKE FERGUSON, TRIFECTA OILFIELD                          §
SERVICES, LLC, CUDD PRESSURE                              §
CONTROL, INC., ROYWELL                                    §       215th JUDICIAL DISTRICT
SERVICES, INC., and OAKS PERSONNEL                        §
SERVICES, INC. d/b/a THE OAKS GROUP                       §


  ORDER DENYING DEFENDANTS, PENN VIRGINIA OIL & GAS, L.P. AND PENN
  VIRGINIA OIL & GAS GP LLC'S MOTION TO COMPEL ARBITRATION AND TO
                                ABATE



        On _ _ _ day of _ _ _ _ _ _, 2015, came to be considered Defendants, Penn

Virginia Oil & Gas, L.P. and Penn Virginia Oil & Gas GP LLC's Motion to Cmnpel Arbitration

and to Abate. After considering the motion and hearing the arguments of counsel, this Court is of

the opinion that the Motion should be DENIED and that Plaintiffs' claims against Defendant Mike

Ferguson and Defendant Oaks Personnel Services, Inc. d/b/a The Oaks Group be severed fro1n and

proceed to trial on October 19,2015.



                                 SIGNED this _ _ _ day of _ _ _ _ _ _, 2015



                                         Elaine H. Palmer
                                         JUDGE, 215TH DISTRICT COURT



Order Denying Defendants, Penn Virginia Oil & Gas, L.P. and Penn Virginia Oil & Gas GP LLC's   Page 1 of 1
Motion to Compel Arbitration and to Abate
