Page 177 - The Persian Gulf Historical Summaries (1907-1953) Vol III

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If the Company should fail to declare so sooner, then the date of
discovery of substances in commercial quantities shall be that date upon
which the Company has completed and tested a well or wells capable
of producing in accordance with first-class oil practice not less than
Two 1 housand (2,000) English tons of clean substances per day for a
period of Thirty (30) consecutive days.
(c) Rupees 30,000 (Thirty thousand) at the end of each year from the date
of signature hereof until the Company declares in writing to the Shaikh
that substances have been discovered in commercial quantities in
accordance with the sub-clause (b) of this Article 5, or until the Com­
pany commences production from quantities less than commercial
quantities. In the event of such production by the Company from
quantities less than commercial quantities cither Rupees 50,000 (Fifty
thousand) per year or Rupees 3 (Three) per English ton of 2,240 lbs.
in respect of the substances so won and saved shall be payable,
whichever is the greater.
(d) At the end of every year from the date upon which the Company makes
in writing to the Shaikh the declaration that the substances have been
discovered in commercial quantities Rupees 90,000 (Ninety thousand)
or Rupees 3 (Three) per English ton of 2,240 lbs. in respect of the
substances other than natural gas, won and saved during the preceding
calendar year, whichever is the greater.
(<?) Annas 2 (Two) per 1,000 cubic feet of natural gas produced and sold.
In calculating royalty for the purpose of this article account shall not be taken
of any of the substances used by the Company in its operations or used by the
Company’s employees within the State, necessary for their use, nor of any water or
foreign matter which may be produced with the substances.

Article 6
The Company shall not carry on any operations within areas occupied by or
devoted to the purposes of mosques, sacred buildings or graveyards.
Article 7
The Company shall conduct its operations in a workmanlike manner and by
appropriate scientific methods and shall take all reasonable measures to prevent
the ingress of water to any petroleum-bearing strata and shall duly close any un­
productive holes drilled by it and subsequently abandoned. The Company shall
keep the Shaikh informed generally as to the progress and result of its drilling
operations but such information shall be treated as confidential.

Article 8
Within three months after the expiry of each calendar year, the Company shall
deliver to the Shaikh a statement of the amount of the substances won and saved
and in the case of natural gas produced and sold during the said calendar year,
and of the royalty which is or might have been payable under Article 5, together
with a report of its operations during the said year. The Shaikh or his represen­
tative shall have the right to check such returns and statements, and all such returns
and statements and the reports of the Company’s operations, shall be treated as
confidential by the Shaikh.
Article 9
(a) The Company shall have the right to import water, the substances, fuel,
machinery, motor-cars and lorries, aircraft, equipment, plant, timber, utensils, iron
work building materials, food supplies, medicines, medical supplies, ofiice cquip-
mentand household furniture, and other materials, equipment and goods of what­
soever nature required by the Company and its employees for the purpose of its
a Derations hereunder and to export the substances and articles previously imported
bv the Company free of customs or export duty and taxes or other charges, but
it shall pay on all personal goods, clothing and general merchandise imported by
the Company for the personal use of its employees or for resale to them the ordinary
duty fn force for the time being in the State Saving as in Article 5 and in this
Ar iel ” provided, the Company, its personnel, its operations, income, profits and