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Exploration & Production (E&P) Contractual Framework

Overview

Upon completion of the course, participants will be able to:

• identify the key issues and constraints in the contractual negotiations between host countries, NOCs and IOCs,
• categorize the different tax systems and contractual frameworks in existence,
• identify the main contractual and fiscal clauses of E&P contracts

 Training Content

1.   Legal Framework

• Objectives of actors, role of national oil companies, stakes in E&P.
• Principles of rent sharing, property of hydrocarbons and State sovereignty.
• Procedure for contracts awarding, different regimes and petroleum laws in the world.
• Legal approach of petroleum law conception and implementation.

2.   Contractual & Fiscal Framework

• Main evolutions in contractual relationships.
• Concessions contracts: principles, State’s revenues, examples of tax regimes and case studies.
• Production-sharing contracts: principles, examples, of tax regimes and case studies.
• Risk-service contracts and technical assistance contracts.
• Fiscal and non-fiscal constraints.
• Objectives of a flexible and progressive tax system.
• Exercise: comparison of concession and production sharing contracts.
• Case study: comparative reading between a HC law and an E&P contract.

3.   Main Articles Of E&p Contracts

• 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.

4.   Joint Operating Agreements

• Main legal provisions in a Joint Operating Agreements (JOA).
• Other agreements: JSBA (Joint Study & Bidding Agreement), unitization, farm-in/farm-out.