Joint Operating Agreements (JOA) are well accepted standard agreements in the oil and gas industry. The basic aim of any JOA is to regulate the relationship of the parties in the Joint Venture: Operator and Non-Operators. The former is responsible to perform the operations on the behalf of the consortium and the latter is responsible to contribute with regards to the financial commitments and expenses of the Joint Venture. However, Joint Operation Agreements typically do not reflect the Non-Operator's perspective, as they traditionally focus on the strong position retained by the Operator. This reality is very clear as the most critical clauses (namely management of operations, limitation of liabilities and removal of the Operator) strengthen the Operator's position, often to the detriment of the Non-Operators. In consequence, such an unbalanced agreement can cause uncertainly, raises the potential for litigation and might even jeopardize the very existence of the consortium. It is important to note that some parties might still sign such an imbalanced agreement in order to secure investment into a project but they will be subject to these risks, and even ultimately termination of the agreement. However, the decline of production and the lack of new reserves (which together reflect the maturity of an oil and gas area) will lead major companies to leave such region in search for a province with greater rewards. As a matter of consequence, the strongest party of the JOA shall be replaced by smaller companies so as there will be a shift on the JOA context from a dominant position for another in equitable terms. Consequently, there is a need for a new and more balanced approach to the negotiation of Joint Operating Agreements, to apply to new, current operations and mature operations, where the Non-Operator's perspectives are fully considered and properly addressed.
| Identifer | oai:union.ndltd.org:bl.uk/oai:ethos.bl.uk:553792 |
| Date | January 2011 |
| Creators | Pereira, Eduardo Guedes |
| Publisher | University of Aberdeen |
| Source Sets | Ethos UK |
| Detected Language | English |
| Type | Electronic Thesis or Dissertation |
| Source | http://digitool.abdn.ac.uk:80/webclient/DeliveryManager?pid=184009 |
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