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accordance with the Sub-Clause (b) of this Article 5 or until the
Company commences Production from quantities less than commercial
quantities. In the event of such Production by the Company from
quantities less than commercial quantities either Rupees Fifty thousand
per year of 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 ninety thousand or
Rupees 3 (Three) per English ton of 2,240 lbs. in respect of the Sub­
stances other than natural gas, won and saved during the preceding
Calendar year, whichever is the greater.
(e) 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
unproductive 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
representative 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 i
work, building materials, food supplies, medicines, medical supplies, office equip­
ment and household furniture, and other materials, equipment and goods of what­
soever nature required by the Company and its employees for the purpose of its
operations hereunder and to export the Substances and articles previously imported
by 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 in force for the time being in the State. Saving as in Article 5 and in this
Article provided, the Company, its personnel, its operations, income, profits and
property including the Substances shall be exempt and free during the period of
this Agreement from all present or future harbour duties, import duties, export
duties, taxes, imposts and charges of any kind whether State or local, tolls and
land surface rent of whatever nature.
In consideration of the right herein granted the Company shall pay in addition
to the Royalty of Rupees (3) three per ton as provided in Article 5—to the Shaikh
within (3) three months after the close of each calendar year the sum of (4) four
annas per English ton of 2,240 lbs. in respect of the Substances won and saved
during the said calendar year.
(b) The importation by the Company of firearms and other weapons is pro­
hibited, except with the written permission of the Shaikh.
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