Avner Oil - Annual Report 2011 - Delek Energy Systems

the oil asset (before other payments at thelevel of the Partnership)Payments (derived from the expenses) in respect of the oil asset and at the level of thePartnership (the following percentages will be calculated in accordance with the Partnership'sshare in the oil asset)There are no payments in the PartnershipEffective share of expenses for exploration anddevelopment of the oil asset, attributable to thePartnership23.2%-23.23%Ashkelon lease - exploration operationsDescription %Summary of the calculation methodfor royalties or payments (withreference to the agreement)Theoretical expenses in the work plan for theoil asset (without royalties)100%Payments (derived from the expenses) at the level of the oil assetOperator 1%-4% These amounts are for indirectexpenses and are in addition toreimbursement of direct expensespaid to the operator. The rate ofpayment to the operator decreases asexploration expenses increase.Total effective rate of expenses at the level ofthe oil assetShare of the equity holders of the Partnershipin the oil asset's expenses (linked)Share of the equity holders of the Partnershipin the effective rate of revenues, at the level ofthe oil asset (before other payments at thelevel of the Partnership)101% -104%23%23.23%-23.92%Payments (derived from the expenses) in respect of the oil asset and at the level of thePartnership (the following percentages will be calculated in accordance with the Partnership'sshare in the oil asset)There are no payments in the Partnership23.23%-Effective share of expenses for exploration andPartnership 25development of the oil asset, attributable to the 23.92%Noa lease - development or production operationsDescription %Summary of the calculation methodfor royalties or payments (withreference to the agreement)Theoretical expenses in the work plan for theoil asset (without royalties)100%Payments (derived from the expenses) at the level of the oil asset25 It is noted that in accordance with the limited partnership agreement, when the Partnership’s exploration expensesexceed USD 1.6 million per quarter, the effective share increases to 24.97%-25.71%.A-22