PETROLEUM PRODUCT STANDARD PURCHASING PROCEDURES | Ref. 0276-26

Note: Any modifications or changes to this procedure will result in automatic rejection by the Seller.

1. Buyer Confirmation
   • Buyer confirms the procedure/product offered.
   • Buyer issues an official ICPO/BCL (Bank to Bank MT199 Swift Message) and includes a copy of the passport of the signatory of the SPA.
2. Draft Sales and Purchase Agreement (SPA)
   • Seller will issue a draft SPA to the Buyer within 5 days.
3. Letter of Guarantee
   • Buyer issues a Letter of Guarantee confirming its commitment to perform strictly in accordance with the SPA terms and mutually accepted transaction procedures. This Letter must be duly signed and stamped on the Buyer’s official company letterhead.
4. Return of Signed SPA
   • Buyer returns the signed SPA to Seller for legalization within 3 days. All pages must be signed by the Buyer on the SPA.
5. Acknowledgment by Seller
   • Seller acknowledges and reviews the duly signed contract. Upon completion of this review, the Seller shall initiate the legalization process through the Kazakhstan Ministry of Energy. All costs associated with legalization shall be borne exclusively by the Seller.
6. Notarized Proof of Product (PPOP)
   • The Notarized Proof of Product shall be prepared and released to the Buyer for acknowledgment and confirmation, enabling the Buyer to commence and complete the bank instrument processing within the agreed timeframe (7 Banking days maximum).
7. Release of Partial PPOP Documents
   • Seller releases the following Partial PPOP documents to the Buyer:
     • (a) Refinery commitment to supply
     • (b) Certificate of Origin
     • (c) Seller Certificate of Incorporation
     • (d) Quality and Quantity Report (Product Passport)
     • (e) Statement of Product Availability
     • (f) Export Certificate
     • (g) Commercial Invoice
8. Bank Instrument Preparation
   • Buyer instructs their bank to prepare the DLC MT700 / SBLC MT760 / Transferable.

Security Guarantee Deposit

9. Guarantee Deposit
   • If the Buyer fails to issue the DLC (MT700) within 5 banking days, the Seller shall issue an invoice requiring the Buyer to remit a $650,000 security guarantee deposit via TT Wire (MT103) to the Seller’s official bank account. This deposit secures the product allocation and will be deducted from the final payment upon delivery.
10. Contract Termination
    • If the Buyer fails to make the $650,000 guarantee deposit within 3 banking days, the contract will be terminated.

Post-Confirmation Process

11. Counter-signing of CPA
    • Within 7 banking days of receiving confirmation of the Buyer’s DLC/SBLC or the $650,000 guarantee deposit, the Seller shall countersign the Charter Party Agreement (CPA).
    • Subsequently, within 7 banking days, the Seller shall issue the Buyer the full Proof of Product (POP) documents and a 2% Performance Bond (PB) as a guarantee of the monthly shipment, contingent upon the DLC and SBLC being in place.
12. Full Proof of Product (POP) Documents
    • The notarized POP documents, duly legalized by the Kazakhstan Export Control Department/Ministry of Energy, shall be sent directly to the Buyer and/or the Buyer’s Bank officer. These documents include:
      • (a) Ship Certificates
      • (b) Cargo Declaration
      • (c) Fresh SGS Report
      • (d) Charter Party Agreement
      • (e) Ownership Certificate
      • (f) Title Transfer Affidavit
      • (g) Product Allocation Certificate
      • (h) Ullage Report
      • (i) Notice of Readiness
      • (j) Customs Declaration Certificate
      • (k) Bill of Lading
      • (l) Vessel Q88
      • (m) Certificate of Origin
      • (n) Export Certificate
      • (o) Product Passport
      • (p) Sales Purchase Agreement

Shipping and Payment

13. Vessel Clearance
    • The Seller shall clear the vessels from the Kazakhstan Authorized Port Terminal. The Buyer shall then confirm the shipping documents directly with the ship master, after which the Seller shall deliver to the Buyer’s designated destination in accordance with the agreed contractual schedule.
14. Shipment Commencement
    • Shipment commences as per the contract schedule.
15. Payment Upon Arrival
    • Upon arrival of the cargo at the discharge port, and after the conclusion of CIQ/SGS/Q&Q at the discharge port:
      • For LC Payment: Seller Bank redeems the activated DLC as per clause 9.0, or the Buyer makes an MT 103 Payment via their bank to the Seller’s bank account.
      • For $650,000 Deposit: The Buyer shall release the remaining payment to the Seller’s Bank via TT/MT103 in USD, in accordance with the agreed payment clause. Such payment must be completed no later than three (3) banking days prior to the discharge.

END OF PROCEDURE