CODE OF CONDUCT FOR A DISCUSSION PROCESS

BETWEEN

LA ORGANIZACION INDIGENA SECOYA DEL ECUADOR – OISE

AND

OCCIDENTAL EXPLORATION AND PRODUCTION COMPANY - OEPC

In the city of Quito, on the twenty-ninth day of October in the year nineteen-hundred ninety-nine:

The following persons convene to formalize this "CODE OF CONDUCT FOR A DISCUSSION PROCESS BETWEEN OCCIDENTAL EXPLORATION AND PRODUCTION COMPANY - OEPC - AND LA ORGANIZACION INDIGENA SECOYA DEL ECUADOR - OISE," (herein called the Code of Conduct): representing the Secoya Nation are Mr. Humberto Javier Piaguaje, President of OISE; Mr. Gilberto Piaguaje, President of the Center Siecoya Remolino; Mr. Colón Piaguaje, President of the Secoya Center San Pablo de Catëtsiaya; and Mr. Vincent Tangoy, President of the Secoya Center Eno, all of whom are duly accredited by an act of the Assembly (attached to the present document); and representing OEPC is Mr. Maston N. Cunningham, in his capacity as President and General Manager, as recorded in the attached document. For the purpose of this Code of Conduct, the aforementioned (who may be designated individually as "the Party" or collectively as "the Parties") freely and voluntarily endorse this document as stipulated by the following contents:

1. ANTECEDENTS

Occidental Exploration and Production Company (OEPC) signed a Service Contract with Petroecuador for the Exploration and Exploitation of Block 15 of the Ecuadorian Amazon Region. This Service Contract was agreed upon on January 25, 1985 and modified on December 18, 1995.

By means of public instrument, on May 21, 1999, this Service Contract was modified to become a Participation Contract for the Exploration and Exploitation of Hydrocarbons in Block 15 of the Ecuadorian Amazon Region.

OEPC has carried out seismic and topographical explorations in the zone chosen for the construction of wells Cocaya North 1, Cocaya 1 and Cocaya Center 1, which it [OEPC] proposes to place in the central part of Block 15, immediately to the south of Aguarico River, inside the territory of the Secoya Nation.

The Secoya Nation has been situated in the Ecuadorian Amazon Region for a thousand years, and its people are located in the following three communities: Secoya San Pablo de Catëtsiaya; Secoya Siecoya Remolino, located in San Roque Parish, Shushufindi Canton, Sucumbíos Province; and Secoya Eno, located in Tarapoa Parish, Cuyabeno Canton, Sucumbíos Province.

The aforementioned communities are the legal owners of the territory in which they live and develop as a Nation, based on their traditional, economic, social, political, cultural, spiritual and legal systems. The Secoya organization, territory and world view are the basis of their millennial survival.

The Secoya territory is a fragile area, reserved for the hunting and fishing of current and future generations, as it is the sole territorial space remaining to the Secoya Nation for daily self-supply and subsistence.

On the other hand, it is known that the Secoya Nation is a human group whose population is diminishing, for which reason it requires great public and private effort for its conservation and protection.

At present, OEPC wishes to continue with its petroleum activities in territory of the Secoya Nation situated inside Block 15, for which reason they have proposed to OISE to negotiate a new agreement. In order to build neighborly relations and mutual respect for the rights of both Parties, OISE and OEPC find it convenient to establish a Code of Conduct to regulate the discussion process.

For the purpose of this Code of Conduct, "discussion process" will be understood to mean the conversations and negotiations between the Parties at the discussion table which refer to the petroleum activities of OEPC in territory of the Secoya Nation within Block 15.

2. OBJECTIVE

The objective of the Code of Conduct is to establish the principles, procedures, requirements, responsibilities, and obligations that OISE and OEPC should fulfill during the discussion process relating to the petroleum activities of OEPC in territory of the Secoya Nation situated within Block 15.

3. PRINCIPLES

3.1. Reciprocal Respect of Rights

The relationship between OISE and OEPC in all of its forms must firmly founded on mutual respect for the rights of the Parties established in the Constitution, the Juridical Orders of the Republic of Ecuador, and in the Agreements, Treaties, Accords and other international juridical instruments ratified by Ecuador.

Recognizing the Secoya Nation's rights to participation, information, consultation and self-determination, and recognizing that the subsoil resources are the property of the Ecuadorian State, both OISE and OEPC swear to abide by the contents of this Code of Conduct.

3.2. Openness and Honesty

The entire discussion process shall be characterized by its openness and honesty.

To ensure the openness and honesty of the discussion process, neither OEPC nor its employees or subcontractors shall enter into any accord or negotiation with members of the Secoya Nation, advisors, or observers outside of the discussion process, with the exception of daily relations that OISE and OEPC have maintained, or in case of an emergency affecting the health of members of the Secoya Nation.

3.3. Representation of the Secoya Nation

OISE is the only and exclusive representative of the Secoya Nation in this discussion process. The representatives officially designated by OEPC and by OISE will attend the meetings.

3.4. Access to Information

All decisions relating to the discussion process should be based upon the principle of previously informed consent. OEPC will submit all information solicited by OISE referring to the operations of OEPC in territory of the Secoya Nation within Block 15, in written form, in a timely and concrete manner, upon authorization from Petroecuador, should this be legally required.

3.5. Fulfillment of the Code of Conduct

The Code of Conduct will be issued in writing in the official languages of the Parties (Pai Coca and Spanish) and will be duly registered before a Notary Public. Observance [of the Code of Conduct] is obligatory for OISE and OEPC.

In the event that the Code of Conduct is not observed in some way that exceeds the jurisdiction of the Follow-up Committee anticipated in this Code of Conduct, each Party is obliged to immediately notify the other of the nonfulfillment. As a result, the discussion table will assemble and take pertinent corrective actions and define a time limit for said corrections. Should the Parties fail to reach a satisfactory solution, the Parties are obliged by mutual consent to seek the help of a third party in order to find an alternative solution.

If this last alternative has been exhausted without a solution being found, either of the Parties may suspend, temporarily or definitively, the discussion process.

4. PROCEDURES

4.1. Structure of the Discussion Table

The Discussion Table is structured as detailed in the following, until the Parties decide by mutual consent to officially modify its composition:

OEPC has officially assigned as their representatives: Wilson Gallegos, Carlos D’Arlach, Alberto Gómez de la Torre, and a legal advisor.

OISE resolved in their XI Congress held on the May 5, 6, and 7 of 1999 to assign as their representatives the President of OISE and the Presidents of the 3 following Secoya communities: Secoya Eno, Secoya San Pablo de Catëtsiaya and Secoya Siecoya Remolino plus two more representatives from the Siecoya Remolino community.

Both OISE and OEPC have the right to replace one or more representatives if it is required. In the event that a representative cannot attend the meetings of the discussion process, OISE and/or OEPC should communicate in writing to the other Party the delegation of another person.

OISE names the following institutions and people as their advisors within the discussion table: Jim Oldham, two legal advisors, a member of the Institute of Sciences and Interdisciplinary Studies (ISIS) and a representative of the Frente de Defensa de la Amazonía (the Amazonian Defense Front).

Pending previous written notice, the Parties may invite independent experts to the discussion process who will be appointed accordance with Number 1 of Clause 4.7 of this Code of Conduct, and whose technical knowledge facilitates communication and clear understanding in the discussion process.

The Parties agree to the permanent participation at the discussion table of the Ecuadorian State through the Undersecretary of Environmental Protection of the Ministry of Energy and Mines, or its official delegate, as well as, after the signing of the Code of Conduct, a representative of Petroecuador who shall submit to the resolutions of this Code of Conduct.

The Parties designate Mr. Theodore Macdonald and Mr. William Vickers as international observers who have declared that they will not delegate their function.

4.2. Planning of Meetings and Definition of the Agenda

Either one of the Parties can propose a meeting, offering to the other an agenda that can be amended with due notice. The agenda should be focused on the discussion process. Once the agenda is agreed upon by the Parties, the meeting should be limited to the topics of the same. The meetings shall be carried out in hours and locations adequate to make possible the participation of the members of the discussion table.

4.3. Designation of a Coordinator or Facilitator

The Parties have agreed that the Fundación Futuro Latinoamericano [Latin American Future Foundation] (FFLA) will coordinate and facilitate activities in the discussion process. However, by common consent, the Parties may name another person or institution to fulfill said activities.

His or her functions will be:

• To call meetings of the discussion process, with due notice, keeping in mind the difficulties of access and geographic location of the different members of the discussion table;
• To coordinate, prepare and distribute the agenda among the members of the discussion table;
• To organize and facilitate the discussion during meetings of the discussion table;
• To take meeting notes and send the report to all of the participants of the discussion table;
• Any other function that the Parties, by common consent, assign to him or her.

4.4. Communication Guidelines

All communications between OISE and OEPC should be in writing, dated and signed by, as well as addressed to, the president of OISE and the official representative of OEPC, or their respective delegates. The language should be respectful, cordial and equitable. Copies should be sent simultaneously to the advisors and international observers.

The Parties shall opportunely communicate the delegation of their function.

4.5. Ratification of Decisions

The delegates of OISE and OEPC should keep their respective organizations continually informed. In order for the decisions of OISE and of OEPC to be valid, they shall be ratified according to the internal mechanisms of each organization and be compatable with timelines established by mutual consent between the Parties.

The Code of Conduct and the resolutions made under this Code will remain in effect in the event of a change of leadership within OISE and its associated communities, and in the event that OEPC sells completely or partially the concession of Block 15, transfers their rights and actions, or changes the company name.

4.6. Discussion Timeline

The Secoya Nation should have sufficient time to study and analyze all the necessary information, educate itself, and discuss its options with all members of the communities before resolving any decision about the petroleum activity, since these could have irreversible impacts on the Secoya culture and environment.

This Code of Conduct will be in effect during the discussion process between OISE and OEPC relating to their petroleum activities.

4.7. Financing

OEPC must provide all necessary resources for the participation of the Secoya Nation in the discussion process, including:

1. Contracting, by OISE, of experts on different subjects related to the discussion process according to the list recommended by the international observers.
2. Training workshops for the Secoya Nation related to the discussion process.
3. Translations into Pai Coca of the Code of Conduct and other documents agreed to by OISE and OEPC related to the discussion process, along with the teaching materials required by OISE for its internal approval process.
4. Cost of communications, telephone, fax, and electronic mail incurred by OISE in order to maintain contact with the members of the discussion table, the contracted experts, and other people and organizations related to the discussion process.
5. Transportation and logistical costs incurred by the members of the discussion table, in accordance with clause 4.1 of this Code of Conduct, in order that they may attend the meetings and workshops, with the proviso that OEPC will finance only the expenses of Mr. Jim Oldham or one representative of ISIS. In the case that the composition of the discussion table is modified, OEPC and OISE will revise, by mutual consent, the financing of new members.
6. Mobilization, transport, food, and work materials costs incurred by the members of the Secoya Nation in order to carry out Assemblies related to the discussion process.
7. A reasonable compensation to the Secoya representatives to the discussion table, for leaving their customary work in order to participate in the meetings of the discussion table. Said compensation will be calculated by OISE and established by mutual consent between the Parties.
8. Any other cost solicited by OISE not included in numbers 1 to 7 above and that has been duly discussed and approved by mutual consent of the Parties.

OEPC and OISE have chosen, by mutual consent, the Fondo Ecuatoriano Populorum Progressio (FEPP) to administer the funds that OEPC issues. OISE shall present expense reports to FEPP, with the supporting documents required by Ecuadorian tax law.

Use of this fund by the Secoya Nation does not imply either any compromise in order to arrive at a resolution, or authorization for OEPC to initiate petroleum activities in Secoya National territory inside Block 15. It is solely an indispensable requirement for the Secoya Nation to continue the discussion process with OEPC.

4.8. Follow-up Committee

The Parties have formed, by mutual consent, a follow-up committee which will be composed of two representatives of OISE and two representatives of OEPC, who will be responsible for coordinating, regulating and resolving issues regarding neighborly relations. They will also receive complaints and petitions and hear conflicts that may arise in the daily relationship between the Parties during the discussion process. Said committee will keep the Parties informed so that they may immediately take pertinent corrective measures.

4.9. Modification of the Code of Conduct

The Code of Conduct can be modified by mutual consent between the Parties.

In testimony of the agreement reached, the following persons sign:

Mr. Humberto Javier Piaguaje,
President of OISE

Mr. Gilberto Piaguaje,
President of the Center Siecoya Remolino

Mr. Vincent Tangoy,
President of the Secoya Center Eno

Mr. Maston N. Cunningham
President and General Manager OEPC

Mr. Colón Piaguaje,
President of the Secoya Center San Pablo de Catëtsiaya

HONORARY WITNESSES

Dr. Diego Iturralde,
President of the Higher Council of CODENPE
Representative of the President of the Republic

Ing. René Ortíz
Minister of Energy and Mines

Dr. William Vickers,
Professor of Anthropology
Department of Sociology and Anthropology
Florida International University

Dr. Jorge Albán
Minister (E) of the Environment

Dr. Theodore McDonald,
Program on Nonviolent Sanctions and Cultural Survival
Weatherhead Center for International Affairs
Harvard University