3.1 Unless otherwise
notified by SELLER, the payment for each shipment
hereunder shall be made by BUYER in U.S. Dollars.
3.2 BUYER shall establish
an irrevocable, confirmed and transferable Letter of
Credit in favour of SELLER for each shipment deliverable
hereunder, covering the anticipated value of oil
comprising such shipment. The amount of Letter of Credit
should cover the total nominated quantity plus the
percentage of tolerance on the basis of provisional
price agreed upon in the Contract. BUYER shall arrange
that such Letter of Credit be duly confirmed to SELLER
by one of the banks acceptable
by SELLER. BUYER shall
ensure that at least 10 days prior to the expected date
of arrival at the loading port of the vessel, nominated
by BUYER. the confirmation of the Letter of Credit
concerned is duly received by SELLER in a manner
acceptable to SELLER. SELLER shall not be responsible
for any delay caused to vessel due to the Letter of
Credit not having been received by SELLER as stipulated
hereinabove.
3.3
Should SELLER agree to supply bunker to the vessel
nominated by BUYER. BUYER shall establish a separate
Letter of Credit covering the anticipated value of
bunker in accordance with paragraph 3.2 above.
3.4
Such Letter of Credit shall specify the financial basis
upon which BUYER has established the Letter of Credit.
(A)
Against BUYER's own credit line with the Letter of
Credit Opening Bank.
(B)
Against Bank Guarantee(s) issued by a third bank
acceptable to the Letter of Credit Opening Bank in which
the name of such bank be declared.
(C)
Against Letter of Credit opened in favour of
BUYER by a third party which constitutes the basis of
Letter of Credit opened in favour of SELLER in which
case the name of such party be declared.
3.5
Payments against Letters of Credit, referred to under
paragraphs 3.2 and 3.3 above, shall be made on the due date
concerned upon the presentation by SELLER << either to
confirming bank directly or to Tehran representative office
of L/C confirming bank >> concerned of the following
documents:
(A)
Original Commercial Invoice plus two copies.
(B)
Full set of Bill of Lading in triplicate, made out to
the order of shipper's (NIOC) account (BUYER's complete
registered name) and duly blank endorsed. The said Bill
of Lading should be signed by the master of vessel or
owner's authorized agent. Such Bill of Lading should be
marked "INSURANCE AND FREIGHT PAYABLE AS AGREED"
(C)
Original certificate(s) of quantity and quality plus two
copies.
(D) In
case NIOC finds it impossible to submit the documents
listed in the L/C documentation clause within the usance
period (i.e. payment period mentioned in crude oil sale
contract and its related letter of credit) then, payment
shall be made against SELLER'S telex invoice to the L/C
confirming bank on contractual due date.
3.6 SELLER may refuse
delivery of the cargo and defer carrying out any of GTC's
obligations if the Letter of Credit or the payment is not
received by SELLER in a manner acceptable to SELLER, in
accordance with the provisions of Section 3 hereof.
3.7 BUYER shall be liable to
pay interest, at a rate mentioned in the Contract if the
value of any shipment is not paid by BUYER at the
contractual due date.
3.8 Irrespective of whether
the due date of payment falls on a Saturday, Sunday or any
other banking or official holidays, the payment should
nevertheless be value-dated on such due date. However,
should the due date of payment falls on a non-banking day,
as stated above, payment may be value-dated on the
immediately succeeding banking day provided interest for the
days overdue is also paid as stipulated in the Contract.
3.9 The text of NIOC standard
L/C shall be considered as integral part of the crude oil
sale contract.
3.10 BUYER shall instruct the
bank concerned to accept the documents in question as and
when presented by SELLER without regard to date of validity
stated in the Letter of Credit.
3.11 BUYER undertakes not to
withhold instructions to vessels agent in Iran to
amend/reissue the Bill of Lading immediately upon receiving
SELLER's request to this effect which may be necessitated
for the purpose of payment of the value of cargo to SELLER.
4.1
SELLER undertakes to deliver and BUYER undertakes to
receive from SELLER the quantity deliverable under the
Contract in full or part cargo lots by vessels nominated
and acceptable for this purpose.
4.2 BUYER
shall receive oil in bulk, to be provided by SELLER at the
loading terminal, in the Persian Gulf, designated by SELLER.
4.3 Delivery shall be deemed
completed and title shall pass as oil passes the flanges
connecting SELLER's pipeline or delivery hose with vessel's
intake pipe, at which point SELLER's responsibility shall
cease and BUYER shall assume all risks of loss, damage,
deterioration or shrinkage to oil so delivered.
4.4 Any loss or damage to
oil, or any property of SELLER or of any other person and
also damages resulting from any type of pollution caused by
the vessel, during berthing, loading and unberthing shall be
borne by BUYER.
4.5 The vessel shall load at
any safe place or wharf reachable on her arrival, which
shall be designated and provided by SELLER, provided that
the vessel can proceed thereto, lie at and depart therefrom
always safely afloat. Each vessel shall comply with all
applicable Government and SELLER's regulations at any time
in force at the loading port.
4.6 All loading and docking
procedures shall be subject to the Port Regulations of the
loading terminals (including but not limited to Conditions
of Use of the Oil Terminal and Tug Requisition) as may be in
force from time to time.
4.7 Unless
otherwise agreed, the quantity of oil deliverable under the
Term Contract shall be evenly spread, as far as practicable,
over each three months period starting from the date of
commencement of
the Contract (referred to
hereafter as ''quarter"). BUYER shall notify SELLER 50 days
before the beginning of each quarter the quantity of oil,
grade by grade, to be lifted during each month of the said
quarter. Such programme of lifting shall be deemed
acceptable to SELLER. But if not acceptable, SELLER shall
notify BUYER within 20 days of the receipt thereof
accordingly, and the two parties shall agree on a mutually
acceptable programme not later than 30 days before the
commencement of the quarter concerned. If thereafter BUYER
fails to lift the quantity so agreed upon during the quarter
concerned, BUYER shall lose his entitlement to lift such
quantity during any subsequent quarter. Furthermore, SELLER
shall have the right to suspend or terminate , the Contract
at his discretion and such suspension or termination shall
not give rise to any claim, whatsoever, by BUYER. Further
deliveries as well as the delivery of the unlifted
quantities in any subsequent quarters shall be solely at
SELLER's discretion.
4.8 BUYER shall furnish
SELLER with the nomination of vessel for its lifting latest
by the 5th of each month for the subsequent month. Such
nomination shall be deemed acceptable to SELLER unless
SELLER notifies BUYER by cable or telex to the contrary
latest by 15th. In such event, the parties shall mutually
agree to arrange for an acceptable date or to arrange for
another vessel to be nominated for the loading. Such
nomination may include to be nominated (TBN).
4.9 Nomination referred to in
paragraph 4.8 above shall include name of vessel (except in
the case of TBN), the quantity by grade of oil to be loaded
and a 5 days range as laycan which, subsequently, should be
narrowed down to three days by mutual agreement.
4.10 Not less
than 10 days before the arrival of the vessel, BUYER shall
inform SELLER about the final date of arrival of the vessel,
and give written instructions regarding the
Vessel,
the making up and disposition of the Bill of Lading and the
order for port(s) of loading and discharging.
4.11 Unless otherwise agreed.
BUYER may substitute another vessel of similar type and
size, provided SELLER is notified by cable at least 5 days
before the arrival of the vessel at loading port. The
schedule date of arrival of any vessel thus substituted as
well as the quantity and quality of oil to be lifted thereby
shall not, without the consent of SELLER, differ from the
last accepted scheduled date, quantity and quality
concerning the vessel for which the substitution is made.
4.12 BUYER shall arrange for
the vessel to report by radio to SELLER at the loading port
7 days in advance of, and again 72 hours, 48 hours and 24
hours prior to arrival at such port, stating expected date
and time of arrival (ETA). If the vessel’s last port of call
is less than 7 days steaming time from the loading port, the
vessel shall report to SELLER as aforesaid, promptly after
departure from its last port of call.
4.13
(A) Loading shall be
subject to the vessel arriving within the agreed date
range and the observance of the principle of "First -
Come - First - Served" in accordance with the custom and
practice of the loading port. Subject to the provisions
of paragraph 4.14 (A), SELLER shall not be obligated to
load the vessel at any time if she arrives after the
above mentioned time unless SELLER notifies BUYER of its
willingness to do so.
(B) For the vessels
arriving before the accepted date range, unless
otherwise agreed, the Notice Of Readiness (N.O.R) shall
be accepted from 00.01 hour of the first day of the
agreed accepted date range. Thus laytime shall commence
6 hours on the first day of the agreed date range or all
made fast, whichever occurs first. In the event it was
agreed by SELLER to
load any vessel before the accepted date range, under
this paragraph, the laytime shall start from period
saved in such case should be considered while
calculating the probable demurrage cases arising by
BUYER at the end of relevant contractual liftings.
(C) For the vessels
berthing on arrival N.O.R. shall be tendered upon the
boarding of the pilot. Otherwise, N.O.R. should be
tendered upon anchoring.
4.14
(A) If a vessel arrives
after the last day of the agreed date range and tenders
N.O.R., it shall await its proper turn and laytime shall
not commence until loading commences.
(B) Should a vessel
nominated by BUYER and confirmed by SELLER not arrive at
the customary anchorage area on the date agreed upon in
the schedule, BUYER shall compensate the SELLER
demurrage at a rate specified in paragraphs 4.20(A),
(B), and (C) whichever is more. The provisions of
paragraph 4.14(B) shall only apply in case the
SELLER incurs demurrage charges to other BUYERS due to
such delay.
4.15
The period of time allowed within which to complete loading
of the vessel shall be increased by any amount of time
consumed due to:
(A) Breakdown of terminal
loading equipments or any oilier operational reasons and
inability of the vessel's facilities to receive the
cargo within the time allowed.
(B) Delays to the vessel
reaching her berth, caused by conditions not reasonably
within SELLER’s control.
(C) Fridays and other
statutory holidays in Iran and/or regulations and
instruction laid down by SELLER and/or the Ports
Authorities which may prohibit loading at anytime.
(D) Delays caused by
weather conditions or by Force Majeure resulting in port
closure. In such cases the period of port closure and a
period equal to port closure after the port reopens or
up to commencement of loading whichever occurs first
shall be added to the laytime.
(E) Vessels awaiting
suitable tide.
(F) Handling ballast or
discharging slops or bunkering.
(G) Vessels awaiting
customs and immigration clearance.
(H) Vessels awaiting
agent’s completing all formalities.
(I) Maximum 4 hours for
the preparation and submission of documents on Board.
(J) Vessels awaiting Letter of Credit clarification,
amendment(s) and/or confirmation.
4.16 Because of
non-availability of ballast treating facilities at the
loading terminals, vessels calling at our terminals should
have either segregated ballast tanks or clean ballast.
(A) Ballast water at
loading terminal will be considered clean and oil
content in the ballast water discharged at loading
terminals should not exceed 15 ppm. However, if any
sheen appears, the master of the vessel shall have to
prove to SELLER through a monitor record that oil
content of the discharged ballast does not exceed 15 ppm.
(B) In case of absence of
monitoring system on
board the vessel, the ballast water other than contained
in segregated tanks shall be considered dirty ballast
and treated accordingly. NIOC'S pilot will check items
(A) and (B) above and in case ballast water on board the
vessel does not comply with the conditions of this
paragraph 4.16, ballast water will be considered as
dirty ballast and should not be discharged and must be
kept in segregated ballast tanks at the owner's or
receiver's risk.
(C) Maximum
6 hours is allowed for discharging ballast and any time
in excess of that shall be counted as excess berth
occupancy and treated in accordance with the paragraph
4.17(C).
4.17
(A) SELLER, shall be
allowed the following laytimes, pro rata for part cargo:
Over
320,000 dwt 64 hours
250,000 to
320,000 dwt 56 hours
200,000 to
250,000 dwt 48 hours
Less than
200,000 dwt 40 hours
(B) Additional 2 hours
allowance shall be considered for each additional grade
loaded.
(C) BUYER shall be
allowed the following berth occupancy times, pro rata
for part cargo:
Over
320,000 dwt 54 hours
250,000 to
320,000 dwt 48 hours
200,000 to
250,000 dwt 42 hours
Less than
200,000 dwt 36 hours
Berth occupancy commences
from the first rope in and finishes at last rope off.
4.18 Loading shall be deemed
completed when hoses are disconnected.
4.19 Vessels subject to
clause 4.17(C) shall vacate berth as soon as loading is
completed. Loss
or damage incurred by SELLER as a result of vessel's failure
to vacate berth promptly, including such may be incurred due
to resulting delay in the docking of other vessels awaiting
at the loading port, shall be paid by BUYER to SELLER as
demurrage. Any such demurrage shall be calculated at the
rate specified in paragraph 4.20 hereunder.
4.20 If the
actual used lay time at the loading port exceeds the allowed
lay time. SELLER shall pay demurrage to BUYER subject to the
provisions of paragraphs 4.6, 4.13 (A), (B), (C) and 4.17
(A), (B), (C) hereof equal to the time certified by the
authorities of the loading port. Such demurrage shall be
calculated as stipulated in (A), (B) and (C) hereunder,
whichever is less:
(A) At the AFRA rate
applicable to vessel of the type to move such cargo in
similar trade under market conditions prevailing on the
date SELLER is notified by BUYER or the name of such
vessel pursuant to paragraph 4.8 hereof.
(B) Where the vessel
being loaded is under charter, the demurrage shall be
paid at the rate provided for in the charter party of
the vessel.
(C) The demurrage
expenses actually incurred by BUYER.
(D) In the event that the
vessel used is owned by or time chartered by buyers the
demurrage rate applicable shall be calculated in
accordance with 4.20 (A) above.
4.21 BUYER shall, at all
times, be responsible for the observance and performance of
all provisions, requirements and obligations set out herein
with respect to the vessel nominated by BUYER.
4.22 BUYER shall give
preferential consideration, on reasonable conditions, to
transportation of oil by the National Iranian Tanker Company
as well as the insurance of the cargo by the Insurance
Company of Iran. For these purposes BUYER shall make the
necessary arrangements with the said companies directly.
4.23 Any claim(s) not
properly documented and received by NIOC within three months
from the date of Bill of Lading shall not be taken into
consideration at all and BUYER shall have no right to raise
any claim(s), whatsoever, afterwards in this respect.