How to avoid aches and pains in your joint ventures

2016 ◽  
Vol 56 (2) ◽  
pp. 559
Author(s):  
Brent Steedman
Keyword(s):  
Joint Ventures ◽  
Joint Venture ◽  
Oil And Gas ◽  
Cost Savings ◽  
Oil And Gas Industry ◽  
Capital Allocation ◽  
Operating Efficiency ◽  
Global Business ◽  
Gas Industry ◽  
The Right

The Australian oil and gas industry is in a period of substantial challenges, including a significant decline in oil prices, fluctuating spot gas prices, a relentless drive for operating efficiency, and tight capital allocation, together with increased regulatory scrutiny and a reputation for below-standards productivity. On the upside, these market challenges provide significant opportunities for companies to bring in new investors, implement new operating models, apply innovation to update processes and practices, and restructure activities. Making material step-changes, requires companies to review, amend, and update joint venture operating agreements (JVOAs). KPMG has worked with many of Australia’s leading oil and gas companies on a range of joint venture engagements. This extended abstract outlines why JVOAs need to be reviewed with respect to the following key opportunities and challenges: Fast-changing global business operating models. Available cost savings by eliminating inconsistent management and operating models between joint ventures. Planning for potential restructuring, including separation of infrastructure (e.g. plants, pipelines, support) from reserve ownership. Sharing of services (e.g. maintenance and logistics) between unrelated joint ventures. Transparency of costs and asset performance. Improved joint venture governance (not more or over-governance) between participants to attract investment. Effective resourcing, noting the right transition of capabilities between deal-makers and joint venture operators. With this extended abstract the authors aim to provide ideas for consideration. Each of these ideas will impact JVOAs. The authors’ proposition is that now is the right time to complete a comprehensive review of JVOAs to enable organisations to move fast as new and innovative opportunities arise.

scholarly journals Fiduciary Relationships in Oil and Gas Joint Ventures

1970 ◽  
Vol 8 (2) ◽  
pp. 233 ◽  
Author(s):  
D. A. MacWilliam
Keyword(s):  
Joint Ventures ◽  
Joint Venture ◽  
Oil And Gas ◽  
Oil And Gas Industry ◽  
Fiduciary Duty ◽  
The Other ◽  
Gas Industry ◽  
Full Disclosure ◽  
Fiduciary Relationships ◽  
The Many

A party to a joint venture agreement in the oil and gas industry is often faced with the problem of determining whether or not he owes a fiduciary duty to his joint venturer. This article examines the many factual situations in oil and gas joint ventures which, could give rise to a fiduciary duty and concludes that the extent to which the fiduciary principle is applicable to various relationships involving interests in oil and gas has not yet been determined by the courts. As such, the author suggests that in addition to attempting to provide in the agreement for those circumstances which could give rise to a fiduciary duty, a party to a joint venture who desires to avoid a breach of a fiduciary duty should make full disclosure to and attempt to get the consent of the other contracting party.

BUILDING CULTURAL CAPITAL IN THE AUSTRALIAN OIL AND GAS INDUSTRY

2004 ◽  
Vol 44 (1) ◽  
pp. 771
Author(s):  
L. Doig ◽  
R. Griffiths ◽  
J. Robertson
Keyword(s):  
High Performance ◽  
Joint Venture ◽  
Oil And Gas ◽  
Cost Savings ◽  
Oil And Gas Industry ◽  
Business Case ◽  
Middle Level ◽  
Gas Industry ◽  
Adaptive Challenges ◽  
Barriers To Growth

One of the key barriers to significant cost-savings and harnessing opportunities for growth in the Australian oil and gas industry is lack of trust, openness and misalignment between companies, among teams and among individuals.In research undertaken for APPEA’s Australian Competitive Energy (ACE) initiative over the last three years, one of the top three barriers to growth continually cited by senior and middle level managers has been culture and behaviours. Examples include misalignment between operators and contractors, management and the workforce, joint venture partners, industry and government, and the industry and the community.In the next five years, the Australian oil and gas industry is facing a skills shortage, technically challenging projects with less people and adaptive challenges. Adaptive challenges (Heifetz and Laurie, 2000) are ones where the:problems and solutions are unclear;the solution does not work through command and control;requires a new way of thinking and acting; andrequires the entire organisation to be engaged.Examples of adaptive challenges for our industry are:finding new gas markets;exploration in sensitive areas;high rig mobilisation costs for a small market; andretaining a skilled workforce.These challenges require companies to find new ways of:Attracting and keeping talented people;Increasing profits and shareholder value; andIncreasing creativity and productivity.Adaptive challenges can be achieved by building cultural capital.This paper outlines:Research and feedback from Australian Operations Managers, Supply Managers, Project Managers and Drilling Managers about the need for improving the culture and behaviours;The business case for why building a high performance culture is considered the competitive advantage of the 21st century;How to measure culture including the diagnostic tool used for the CEO workshop;Results from the diagnostic of the CEO group and implications;andHow to move forward individually, as companies and as an industry.The purpose of this paper is to foster debate and discussion about developing a high performing culture in the Australian oil and gas industry. We intuitively know that valuing our people makes good business sense. To transform the industry’s culture, it is not the organisations that transform, but the people. Shifting the culture requires leadership, courage and commitment from the industry’s senior management.

scholarly journals An Overview of the New Competition Law: Issues for the Oil and Gas Industry

1987 ◽  
Vol 26 (1) ◽  
pp. 59
Author(s):  
Lawson A. W. Hunter ◽  
John F. Blakney
Keyword(s):  
Joint Ventures ◽  
Oil And Gas ◽  
Competition Law ◽  
Oil And Gas Industry ◽  
Gas Industry ◽  
Dominant Position ◽  
Abuse Of Dominant Position ◽  
Restraint Of Trade

This paper reviews the major changes to Canada's competition law enacted in 1986, including new merger and abuse of dominant position provisions, the establishment of a Competition Tribunal, mandatory pre-notification of certain transactions, and revisions of the prohibition against agreements in restraint of trade. Special attention is given to joint ventures, export agreements and vertically integrated resource companies.

The face of energy

2019 ◽  
Vol 59 (3) ◽  
Author(s):  
Peter Bennett
Keyword(s):  
Environmental Sustainability ◽  
Public Perception ◽  
Oil And Gas ◽  
Political Influence ◽  
Oil And Gas Industry ◽  
Problem Solver ◽  
Gas Industry ◽  
The Public ◽  
The Face ◽  
The Right

In this era of technological disruption, when many industries are fighting to stay relevant, the oil and gas industry seems to be stagnant. It is in this environment where public perception of the modern industry is becoming more critical and as younger consumers grow in both number and political influence, their viewpoints will become especially vital to the continued relevance of the industry. The oil and gas industry gives itself high marks for innovation, safety and environmental sustainability, and yet the public opinion in these areas is often portrayed very negatively. We have an image problem. The belief that oil and gas is good for society seems to decline with each younger generation. The public believes the industry is necessary for society, though they still see it as a problem causer, not a problem solver. But support for the industry falls with each generation and millennials are more likely to believe the industry is bad for society and a problem causer. The oil and gas industry needs to communicate and engage with consumers to identify ways to better understand their motivations and concerns. Clearly there is a gap in how the public and executives view the industry and the time to address these perceptions is now. To view the video, click the link on the right.

Enhancing Indigenous partnerships in an increasingly digitised oil and gas industry

2019 ◽  
Vol 59 (2) ◽  
pp. 639
Author(s):  
Michael Lynn ◽  
David Wirrpanda
Keyword(s):  
Oil And Gas ◽  
Minority Groups ◽  
Service Providers ◽  
Indigenous Communities ◽  
Oil And Gas Industry ◽  
Career Pathways ◽  
Perceived Threat ◽  
Gas Industry ◽  
Digital Workplace ◽  
The Right

As oil and gas operators and service providers look to embrace automation and analytics, many of the traditional partnerships with Aboriginal communities relating to employment and career pathways are likely to be challenged. The paper explores how digital trends are affecting, and are likely to affect, Indigenous communities in their partnerships with oil and gas organisations. Workplace roles and activities are evolving in our increasingly digitised world, causing a perceived threat to employment for minority groups such as Indigenous communities. In order to ensure the ongoing presence of opportunities for Indigenous workers in the ‘future of work’, oil and gas organisations will need to augment digital technologies to cater for and enhance existing and future roles. This paper presents a framework for Indigenous communities, governments, oil and gas operators and service providers to embrace digitisation and create sustainable relationships. An approach is considered to engage with Indigenous communities with objectives of executing on their Reconciliation Action Plans and addressing culture and employment challenges that arise through digitisation. The framework positions oil and gas operators and service providers to pivot themselves not only to sustain, but also to enhance Indigenous employment opportunities in a digital workplace. Digitisation is here, but with the right approach it can positively affect and shape partnerships between oil and gas organisations and Indigenous communities.

scholarly journals ARBITRATION AND PUBLIC POLICY IN BRAZIL: A STUDY BASED ON ‘LULA CASE’

2018 ◽  
Vol 4 (5-6) ◽  
pp. 223-264
Author(s):  
Carolina Barreira Lins
Keyword(s):  
Public Policy ◽  
Natural Resources ◽  
Oil And Gas ◽  
Oil And Gas Industry ◽  
The State ◽  
Gas Industry ◽  
National Courts ◽  
Arbitration Clause ◽  
Exploration And Production ◽  
The Right

This work examines the subject of jurisdiction and arbitrability of issues related to energy and natural resources in the world, in order to enhance the arbitration institute in Brazil. The study is based on a recent case pending in Brazilian courts, named “Lula case”, which refer to a dispute between the State and concessionaires that grant the right to explore and produce oil and gas in a determined area. The presence of arbitration clauses in the concession contracts for exploration and production of oil and gas in Brazil raises questions related to the disposability of the rights concerned. It is paramount to set benchmarks on arbitral tribunals’ power to decide on these matters and to define to what extent arbitral awards may defy public policy, national sovereignty over natural resources and national courts’ jurisdiction to render decisions in this regard. Otherwise, the randomness of judicial decisions makes the arbitration clause ineffective. Moreover, the Lula case arises substantive issues related to the necessity to protect investors in the oil and gas industry, since acts arguably connect to the State policy power may cause damages to the private parties. The work critically examines the decision given by national courts so far and proposes an international approach to face situations involving the State and the necessity to protect investors in the oil and gas industry.

scholarly journals 3PL provider selection in oil and gas industry using the analytic hierarchy process: A case study in oil-field services company X

2020 ◽  
Vol 9 (1) ◽  
Author(s):  
Nguyen Thi Duc Nguyen ◽  
Le Tran Chinh
Keyword(s):  
Supply Chain ◽  
Oil And Gas ◽  
Oil And Gas Industry ◽  
Oil Field ◽  
Analytic Hierarchy ◽  
Software Support ◽  
Gas Industry ◽  
Expert Choice ◽  
The Right ◽  
Outsourcing Logistics

This study aims to: (1) Summarize the criteria for selecting 3PL Provider in supply chain management from literature review and apply these criteria to build the criteria model in choosing 3PL Provider for oilfield services company X for the purpose of expanding their market in the oil and gas industry and (2) Analyze, evaluate two 3PL Providers, along with a new 3PL Provider and suggest the strategy for selecting the suitable 3PL Provider to meet the specific requirements from company X. By arranging in-depth interviews with ten people with different positions, including Operation Manager, Supply Chain Manager, Logistics Manager, Base Manager and Logistics Specialist, along with AHP approach and expert choice 11.0 software support in collecting, processing and synthesizing data to evaluate and determine the appropriate 3 PL Provider for company X. In this study, three 3PL Providers have been chosen for analyzing and evaluating – 3PL Providers A, B, and C. The final results demonstrate that there are six main criteria and 13 sub-criteria in choosing 3PL Provider for oilfield services company X. The six main criteria are Performance, Price, Services, Quality assurance, IT system and Intangible values. The results and hypothetical situations have also been presented and discussed again with the expert logistics group to get their feedback about the practicability of the built model. The expert logistics group has agreed that the built criteria model and results are appropriate and adequate for evaluating and selecting a suitable 3PL Provider from the company’s specific demands. Consequently, this study can also be applied for similar purposes in other companies and shipping agents who need to work with outsourcing logistics services in oil and gas industry by using this built criteria model and synthesis results to find out the right decision for selecting 3PL Provider.

scholarly journals Cost and managerial accounting of joint activities related to the use of fixed assets

2018 ◽  
pp. 84-93
Author(s):  
Zenovii Zadorozhnyi ◽  
Valentyna Orlova ◽  
Sofiia Kafka
Keyword(s):  
Joint Venture ◽  
Oil And Gas ◽  
Oil And Gas Industry ◽  
Separate Entity ◽  
Managerial Accounting ◽  
Joint Operation ◽  
Gas Industry ◽  
Joint Activities ◽  
Fixed Assets ◽  
Joint Operations

The research paper reveals the essence of the concepts of joint activity, joint operation, and joint venture. A set of key features for classification of joint activities is identified and their impact on accounting of joint activities is assessed. The article also reviews the essential elements of accounting of joint activities in the light of International Financial Reporting Standards (IFRS), and characterizes the process of recording accounting entries related to basic operations, which depend on organizational forms of joint activities (a joint venture or a joint operation, with or without a separate entity). The paper provides a detailed description of three options for accounting of joint activities classified as joint operations, namely: joint operations without a separate entity; joint operations with a separate entity but without legal personality; a legal unit. Besides, a number of particular characteristics of measuring financial results from selling and purchasing assets within joint operations are identified. It is pointed out that one of the ways of effective use of fixed assets is promoting the implementation of managerial ac- counting of joint activities and internal reporting procedures of the results achieved. It is suggested that domestic enterprises of oil and gas industry should expand the practice of joint activities in order to effectively use fixed assets for oil and gas extraction and transportation. Before conducting joint activities, it is recommended that oil and gas industry enterprises compile initial calculations of their profitability at the level of managerial accounting. In the study, the following general and specific scientific methods of obtaining knowledge on economic phenomena are used: generalization, grouping and comparison, analysis, synthesis, induction and deduction, etc.

scholarly journals KAZAKH-TURKISH RELATIONS: TRADE AND ECONOMIC ASPECT

2021 ◽  
Vol 68 (1) ◽  
Author(s):  
А.Е. Ibrayeva ◽  
Keyword(s):  
Central Asia ◽  
Joint Ventures ◽  
Soft Power ◽  
Oil And Gas ◽  
Oil And Gas Industry ◽  
Legal Framework ◽  
International Markets ◽  
Present Stage ◽  
Gas Industry ◽  
Solid Foundation

The article examines the trade and economic cooperation between the two countries at the present stage. Given the fact that Turkey is actively expanding its presence not only in Kazakhstan, but also in Central Asia, this issue is of urgent importance.Turkish business is represented in various sectors of the Kazakh economy: construction, transport, and communications. At the same time, we note that Turkey invests in the strategic sectors of our economy. Joint-stock companies and joint ventures have been established that produce products for domestic and international markets. Over the years, a legislative and legal framework has been formed in all areas of cooperation. The Turkish presence is noticeable not only in Kazakhstan, but also in Central Asia. Ankara has managed to put economic and humanitarian cooperation between our countries on a solid foundation. Among the priorities of Turkey's "soft power" are joint projects in the oil and gas industry, education and culture

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