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Table of contents

Introduction

Glossary

1.First principles of the JOA

1.1 The logic for a joint venture

1.2 The concept of the JOA

1.3 The incorporated joint venture

1.4 Hybrid project structures

1.5 Partnership contrasted

1.6 Pre-JOA agreements

1.7 Model form contracts

1.8 JOA evolution and economics

2.Concession forms and the JOA relationship

2.1 Introduction

2.2 Applicable terms

2.3 Operator rights and duties

2.4 State participation in the joint venture

2.5 Liability

2.6 Disposal of petroleum

2.7 Property and ownership

2.8 Decommissioning

2.9 Information and confidentiality

2.10 Dispute resolution

2.11 Exclusive operations and non-consent

3.Parties, participating and carried interests and collateral support

3.1 The parties

3.2 Participating and carried interests

3.3 Collateral support

3.4 Joint property

4.Managing state participation

4.1 State participation in the concession and JOA

4.2 Later state participation

4.3 Carried interests

5.Duration

5.1 Pre-JOA arrangements

5.2 Commencement

5.3 Term

5.4 Termination and surrender

5.5 Surviving provisions

6.Scope

6.1 Joint operations

6.2 Excluded activities

6.3 Expanding the scope

6.4 Definition of the scope

6.5 Modification of the scope

7.The operator

7.1 The operator’s advantage

7.2 Selection of the operator

7.3 The role of the operator

7.4 The locus of the operator

7.5 Resignation and removal

7.6 Hybrid operator structures

7.7 The operator’s perspectives

7.8 Fiduciary duties and relational contracts

8.The non-operating parties

8.1 The role of the operating committee

8.2 Operating committee mechanics

8.3 Subcommittees

8.4 Voting control

8.5 The non-operating parties’ perspective

9.The accounting procedure

9.1 Model form accounting procedures

9.2 Accounting principles

9.3 Contents of the accounting procedure

9.4 Accounting procedure issues

10.Economic management

10.1 Introduction

10.2 Work programmes and budgets

10.3 Authorities for expenditure

10.4 Cashcalls and invoice requests

10.5 Payment obligations

10.6 Dealing with default

11.Contracting

11.1 Procurement options

11.2 Third-party contracts

11.3 Affiliate contracts

11.4 Federal contracts

11.5 Contributions in kind

11.6 Awarding of contracts

11.7 Contract management, audit and ABC compliance

12.Petroleum management and disposal

12.1 Introduction

12.2 Petroleum allocation

12.3 Petroleum lifting

12.4 Petroleum disposal

12.5 Production sharing contract allocation

13.Exclusive operations

13.1 Defining exclusive operations

13.2 Exclusive operations mechanics

13.3 Buy-back rights

13.4 Excluding exclusive operations

14.Transfers and withdrawals

14.1 Transfers under applicable law

14.2 Transfer mechanics in the JOA

14.3 Incomplete transfers

14.4 Pre-emption rights

14.5 Change of control

14.6 Affiliate transfers

14.7 Withdrawal

14.8 The use of the withdrawal mechanism

15.Joint venture information and competition law

15.1 Information and confidentiality

15.2 Public announcements

15.3 Intellectual property rights and rights in information

15.4 Intellectual property rights – JOA drafting considerations

15.5 The operator as custodian of information and intellectual property

15.6 Competition law

15.7 The nature of the agreement under competition law

15.8 Relevant JOA provisions

15.9 Concessions

15.10 Procurement of goods, works and services

15.11 Sales of hydrocarbon production

15.12 Downstream transportation and processing facilities

15.13 Geological and geophysical data; other forms of technology

15.14 Competition law and information exchange

16.Decommissioning

16.1 The decommissioning phase

16.2 The regulatory regime

16.3 Collateral support for decommissioning costs – regulatory requirements

16.4 Decommissioning and the JOA

16.5 Decommissioning on the UKCS

17.Liabilities

17.1 The operator’s liability to the parties

17.2 Liability allocation between the parties

17.3 Liability for exclusive operations

17.4 Third-party liabilities

17.5 Liabilities and insurance

17.6 General liability

18.Default

18.1 Consequence of default

18.2 Definition of default

18.3 Reaction to default

18.4 Remedies for default

18.5 Mortgage and lien protection

18.6 Interest sales

18.7 Forfeiture

19.Dispute resolution

19.1 Dispute resolution principles

19.2 Dialogue

19.3 Expert determination

19.4 Arbitration

19.5 Litigation

19.6 Arbitration or litigation?

19.7 Consolidation

19.8 Confidentiality

19.9 Jurisdiction

19.10 Sovereign immunity

20.Other provisions

20.1 Corporate and social responsibility

20.2 Entire agreement and amendment

20.3 Force majeure

20.4 Governing law

20.5 Health, safety and the environment

20.6 Insurance

20.7 Litigation management

20.8 Notices

20.9 Secondment and teams

20.10 Taxation

20.11 Third-party involvement

20.12 Warranties and representations

Appendix 1: Farm-outs and the JOA

Appendix 2: Unconventional petroleum JOAs

Appendix 3: Unitisation and the JOA

About the authors

Index

About Globe Law and Business

Joint Operating Agreements

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