Production Sharing & Joint Operating Agreements

EAM/PSA

Who should attend?

  • To provide participants with an in-depth understanding of the concepts, mechanisms and articles of Production Sharing and Joint Operating Agreement.
Audience :
  • Exploration and production professionals, legal personnel entering the E&P scene, service companies managers and government employees.

Level : Proficiency

Course Content

  • PRODUCTION SHARING AGREEMENTS (PSA)

      • Introduction
      • Origins, concept and scope of the PSA.
      • Comparison of PSA to other contracts.
      • Contents and structure of a typical PSA.
      • PSA mechanisms
      • Cost oil, profit oil split, “Government Take”.
      • Bonuses, first tranche petroleum, tax holiday, cost recovery ceilings, uplifts, investment credits, government “back-in”.
      • Typical PSA cash flow forecast chart.
      • Case study: comparative reading of a mining law and a PSC.
  • MAIN ARTICLES OF AN E&P CONTRACT

      • General structure of patrimonial contracts.
      • Exploration phase: duration, commitments, surrender, data and information, etc.
      • Appraisal phase: work program, gas provisions, commerciality, etc.
      • Development phase: financing, State participation, budgets and development plans, unitization, etc.
      • Production phase: work conduct and supervision, audit and accounting, financing, taxation, transportation and marketing of production, hydrocarbon price determination, etc.
      • General terms & conditions: title transfer, sole risk, force majeure, local content, environmental protection, governing law and dispute resolution.
      • Conclusion: Recent trends in oil taxation and patrimonial contracts.
      • Real-life examples from the news.
  • JOINT OPERATING AGREEMENTS (JOA)

      • Introduction:
      • The purpose of the joint ventures and use of a JOA.
      • The relationship of the JOA to other oil industry contracts.
      • Structure of a JOA, definitions and terminologies.
      • The operator: appointment, rights and duties, liabilities, responsibilities, resignation, removal.
      • The partners:
      • Rights and duties, liabilities, responsibilities.
      • The operating committee and sub committees.
      • Establishment, powers and duties, notices, voting procedures, impact of voting, pass-mark.
      • Case study: discussing the main articles of a selected Joint Operating Agreement (JOA).

Learning Objectives

  • Upon completion of the course, participants will be able to:
  • identify the main concepts, principles and articles of a Production Sharing Agreement which contractually binds petroleum companies with a ministry and/or a state oil company,
  • evaluate the management of Petroleum Exploration and Production partnerships to successfully find and produce hydrocarbons,
  • discuss the practical aspect of contracts: identifying key issues, understanding constraints and deadlines, getting familiar with the document.

Ways & Means

  • Case studies.
  • Exercises on Production Sharing Contracts.
  • Analysis of Joint Operating Agreements.
  • Examples of petroleum laws and fiscal regimes around the world.