The Contract Regime for Unitisation and the Impact of Production Sharing Contracts on Joint Development in Nigeria

2021 ◽  
Author(s):  
Mendos James
Keyword(s):  
Best Practices ◽  
Oil And Gas ◽  
Operating Cost ◽  
Regulatory Regime ◽  
Joint Development ◽  
Production Sharing ◽  
Effective Manner ◽  
Petroleum Resources ◽  
The Impact ◽  
Petroleum Drilling

Abstract Unitisation has evolved globally as the best mechanism for the joint development of hydrocarbon bearing reservoirs that straddle two or more concessions or licenses. The concept of unitisation is underpinned by the need to avoid competitive exploitation of hydrocarbon resources, maximise its economic recovery, eliminate proliferation of production facilities and reduce development and operating cost.1 The practice of unitisation in the Nigerian oil and gas landscape has gained traction over the years with several straddle fields identified as candidates for unitisation and more than ten (10) agreements for joint development (both Pre Unitisation Agreements and Unitisation and Unit Operating Agreements) executed in the industry. This has occurred under a regulatory regime for unitisation that has evolved from the concise provisions of Section 48 of the Petroleum (Drilling and Production) Regulation 1969 as amended, to the robust Guidelines for Unitisation issued by the Department of Petroleum Resources (DPR) in 2008 (revised in 2019) (Guidelines) in response to the complexities of joint development encountered by parties. While the Guidelines is an excellent attempt at providing a process for unitisation, it does not provide sufficient guidance on the contract regime for unitisation as the bedrock for joint development. A critical look at the contracts governing joint development in the light of global best practices is important to ensure that it meets in an effective manner the objectives of unitisation. A review of the contract regime for unitisation would be incomplete without recognising the impact that underlying contracts governing separate concessions have on unitisation. To this end, the posture of Production Sharing Contracts (PSCs) on gas development in a unit is worth reviewing in the light of the benefits of commercialising gas to the State and the Contractor. This paper reviews the contract regime for unitisation in Nigeria as regulated by the Guidelines and the impact that underlying contracts (particularly PSCs) have on unitisation. The paper will proffer recommendations for inclusion in the Guidelines with a view to improving the process of joint development of shared reservoirs in Nigeria.

Joint Development: An Alternative Legal Approach to Oil and Gas Exploitation in the Nigeria-Cameroon Maritime Boundary Dispute?

2006 ◽  
Vol 21 (4) ◽  
pp. 489-522 ◽  
Author(s):  
Chidinma Bernadine Okafor
Keyword(s):  
Marine Mammals ◽  
Oil And Gas ◽  
Joint Development ◽  
Maritime Boundary ◽  
Alternative Approach ◽  
Petroleum Resources ◽  
Close Cooperation ◽  
National Boundaries ◽  
Transboundary Resources ◽  
Petroleum Reserves

AbstractThe delimitation of a maritime boundary is not necessarily a panacea for disputes over offshore resources. Neither petroleum reserves, which are fugacious in character, nor fish or marine mammals respect national boundaries. Even successful delimitation may still require a degree of close cooperation if opposite or adjacent states are to exploit such transboundary resources rationally. Such cooperation can be achieved by the concept of joint development. This paper reviews the literature on the joint development of offshore petroleum resources and the controversy surrounding the concept. The paper further examines its applicability as an alternative approach to the Nigeria-Cameroon maritime boundary dispute.

Mud-Sealing Cement System Delivers Notable Cement Bond Log Result in a Challenging Offshore Horizontal 4 ½-in Liner: A New Technology Case Study

2021 ◽  
Author(s):  
Degaul Nana Nzoutchoua ◽  
Carl R. Johnson ◽  
Armelle Boukoulou Mounguele ◽  
Chibuzor Onyia ◽  
Giovanni Rizza ◽  
...  
Keyword(s):  
Best Practices ◽  
Oil And Gas ◽  
New Technology ◽  
Drilling Fluids ◽  
Directional Drilling ◽  
Drilling Tool ◽  
Cement System ◽  
Liner System ◽  
The Impact ◽  
Pipe Rotation

Abstract A 1575m [4922-ft] offshore horizontal 4-½-in. liner cemented using a mud-sealing cement system (MSCS) resulted in an outstanding cement bond log result. The decision to use the MSCS was taken after realizing that four offset liners, previously cemented using conventional cement systems, did not yield acceptable cement bond log results despite following oil and gas cementing industry best practices, including pipe rotation. This paper documents a comparison of six offset horizontal liners, focusing on the impact of the MSCS technology. The paper focuses on several 4-½-in. liners in the same field. The wells were drilled by a similar rig and had similar well profiles. The drilling bit, directional drilling tool, drilling fluids system, logging tool, centralizer type and pumping sequences were comparable across all wells. In addition, the logging company performing the cement bond log evaluation was not the same company performing the cementing service. After the first MSCS-cemented well, the subsequent well used a conventional cement system to isolate the 4-½-in. liner and tighten the cementing best practices. This was initiated to irrefutably confirm the impact of MSCS technology on the quality of cement bond log recorded on the earlier well. The cement bond log recorded from the well isolated with MSCS is easily identified among the six comparison wells even though the cementing operation faced several well challenges, includinga single dart liner system implementation (for all liners), which can promote the intermixing of slurry with fluid ahead while travelling down the pipemud losses in the drilling phase, which resulted in a reduction of the displacement rate to control ECD during cement placement. The bond log results of the other wells were qualified as poor or fair, even though significant precautions were taken to optimize zonal isolation. These efforts included batch mixing the spacer and slurry, using more than one centralizer per casing joint, and implementing pipe rotation during pre-job circulation and job execution when the torque limit allowed. This multi-well comparison based on field results brings solid evidence of the MSCS technology interacting with the residual layer of nonaqueous fluid (NAF) when well conditions reach or exceed the practical normative limitations for mud removal. This in-situ interaction generates a viscous paste that positively impacts the bond log response and bolsters the isolation between zones of interest. The result has yielded a step forward in the provision of a dedicated barrier technology for horizontal or highly deviated sections.

2015 Offshore Petroleum Exploration Acreage Release

2015 ◽  
Vol 55 (1) ◽  
pp. 67
Author(s):  
Demus King
Keyword(s):  
Oil And Gas ◽  
Petroleum Exploration ◽  
Regulatory Regime ◽  
Good Standing ◽  
Challenges And Opportunities ◽  
Petroleum Resources ◽  
Australian Economy ◽  
Under Construction ◽  
High Level ◽  
Offshore Petroleum

The oil and gas sector is a key contributor to the Australian economy, contributing $30.8 billion in commodity export earnings in 2013–14 (Department of Industry and Science, 2015). Underpinning future growth in the value of oil and gas to the Australian economy is the almost $200 billion of investment in seven LNG projects under construction. Australia relies on foreign capital to continue to explore for, and develop, its natural resources. New challenges and opportunities are arising for the sector. Increased international competition, advancing technology, and increasing risks and volatile costs associated with the development of fields are features of the current offshore operating environment. Australia’s legislative and policy settings must be sufficiently robust and flexible to support the continued development of Australia’s offshore resources into the future. To this end, the Australian Government is undertaking a high-level strategic review of the resource management framework for offshore petroleum resources in Commonwealth waters. The review will test the robustness of the policy, legal and regulatory regime to ensure the framework remains flexible enough to keep pace with the evolving environment and continues to attract investment. The annual Offshore Petroleum Exploration Acreage Release facilitates new investment in offshore petroleum exploration. The 2015 Acreage Release is accompanied by an updated exploration guideline. The guideline increases flexibility in permit management and clarifies competitive work program bidding expectations and good standing as well as providing more flexibility in the way good standing agreements may be discharged. This will enable industry to undertake exploration with increased autonomy and reduce the administrative burden. It accommodates changing technological capacity and encourages increased exploration in Australia’s offshore waters.

The Value Additions of Oil and Gas Industry Service Permit in the Nigerian Oil and Gas Industry

2021 ◽  
Author(s):  
Michael Edem ◽  
Abdullahi Alfa ◽  
Okechukwu Nwankwo
Keyword(s):  
Oil And Gas ◽  
Service Providers ◽  
Oil And Gas Industry ◽  
Technical Service ◽  
Application Process ◽  
Gas Industry ◽  
Mandatory Requirement ◽  
Petroleum Resources ◽  
Regulatory Instruments ◽  
Petroleum Drilling

Abstract The Department of Petroleum Resources, Nigeria's oil and gas industry regulator, is an opportunity provider and business enabler. Using regulatory instruments such as Licenses, Approvals and Permits, the Department has enabled investors to unlock opportunities in the Upstream, Midstream and Downstream sectors of the industry. The Oil and Gas Industry Service Permit (OGISP) is a mandatory requirement for all service providers rendering or engaged to render technical service to the industry, in accordance with section 60A of the amended Petroleum (Drilling & Production) Regulations, 1988. Since its establishment, the Department has issued over a million permits to service providers in various areas of specialization. This paper examines the OGISP system framework; OGISP application process and requirements for permit issuance; benefits of OGISP to the industry and the Nigerian economy; and recommendations to improve the OGISP system.

Impacts of the review of the Brazilian local content policy on the attractiveness of oil and gas projects

2019 ◽  
Author(s):  
William Clavijo ◽  
Edmar de Almeida ◽  
Luciano Losekann ◽  
Niágara Rodrigues
Keyword(s):  
Oil And Gas ◽  
Oil Prices ◽  
Income Generation ◽  
Local Content ◽  
Oil Market ◽  
Production Sharing ◽  
Exploration And Production ◽  
Current Context ◽  
Oil Sector ◽  
The Impact

Abstract The study assesses the relevance of the recent local content policy (LCP) reforms for the oil sector in Brazil on the attractiveness of investments in exploration and production (E&P), and in terms of employment and income generation. For this, a cash flow of a typical E&P project was simulated in the Brazilian pre-salt environment in a field with reserves of 5 billion barrels of oil equivalent, under the regime of production sharing, adopting the assumptions of government participation of the tender protocol of the Libra field. In addition, in order to estimate the impact of the LCP on the generation of employment and income, the methodology of the Input–Output Model (IOM) was applied. The results indicated that high commitments of local content (LC), in contexts of restricted oil prices, compromise the profitability of E&P projects. In addition, the results showed that a greater volume of investments can more than offset the impact of higher levels of LC in generating employment and income for the country. Finally, the article concludes by arguing that the LCP reforms, undertaken since 2016, were necessary to guarantee the competitiveness of the Brazilian upstream in the current context of the international oil market.

The New Timor Sea Arrangement 2001: Is Joint Development of Common Offshore Oil and Gas Deposits Mandated under International Law?

2002 ◽  
Vol 17 (1) ◽  
pp. 79-122 ◽  
Author(s):  
Keyword(s):  
International Law ◽  
Legal Status ◽  
Oil And Gas ◽  
East Timor ◽  
Joint Development ◽  
Legal Implications ◽  
Petroleum Resources ◽  
Full Independence ◽  
Timor Sea ◽  
Offshore Oil And Gas

AbstractA new Timor Sea Arrangement is to be adopted by Australia and East Timor upon East Timor's full independence. It is a potentially significant achievement in the prospects for joint development of the petroleum resources in the Timor Gap. This article analyses the legal implications of this latest development in the Timor Gap saga. The new Arrangement implements a modified version of the joint development principle enshrined by the earlier 1989 Timor Gap Treaty much more favourably to the imminent East Timor state. However, the uncertain legal status of the new Arrangement raises questions as to its continuing viability following East Timor's independence. Analysis of this Arrangemcnt suggests that it is sufficiently robust to stand the test of time. More generally, it can now be argued that joint development is mandated under international law as a viable legal alternative to straightforward continental shelf boundary delimitation in the presence of common hydrocarbon deposits.

Consideration of Geopolitical Challenges within the Analysis of Geoenvironmental Risks for Oil and Gas Development of the Russian Arctic

2019 ◽  
Vol 16 (6) ◽  
pp. 50-59
Author(s):  
O. P. Trubitsina ◽  
V. N. Bashkin
Keyword(s):  
Oil And Gas ◽  
Oil And Gas Industry ◽  
Optimal Operation ◽  
The Arctic ◽  
Stage Model ◽  
Oil And Gas Development ◽  
Gas Industry ◽  
The Impact ◽  
Further Development ◽  
Geopolitical Risks

The article is devoted to the consideration of geopolitical challenges for the analysis of geoenvironmental risks (GERs) in the hydrocarbon development of the Arctic territory. Geopolitical risks (GPRs), like GERs, can be transformed into opposite external environment factors of oil and gas industry facilities in the form of additional opportunities or threats, which the authors identify in detail for each type of risk. This is necessary for further development of methodological base of expert methods for GER management in the context of the implementational proposed two-stage model of the GER analysis taking to account GPR for the improvement of effectiveness making decisions to ensure optimal operation of the facility oil and gas industry and minimize the impact on the environment in the geopolitical conditions of the Arctic.The authors declare no conflict of interest

Minerals as an object of accounting and economic security of the oil and gas company implementing the production sharing agreement

2020 ◽  
Vol 23 (11) ◽  
pp. 1291-1312
Author(s):  
N.V. Zyleva
Keyword(s):  
Oil And Gas ◽  
Economic Security ◽  
The State ◽  
Professional Judgment ◽  
Production Sharing ◽  
Security Service ◽  
Geological Information ◽  
Oil And Gas Companies ◽  
Mineral Reserves ◽  
Economic Risks

Subject. This article discusses the practice of ensuring the economic security of oil and gas companies operating under the terms of production sharing agreements, where minerals are the object of security. Objectives. The article aims to justify the need to apply professional judgment in the organization of reliable accounting of minerals, explored and extracted under the terms of the production sharing agreement implementation, to avoid various risks to the entity's economic security. Methods. For the study, I used the methods of deduction and modeling. Results. The article presents proposals to arrange accounting of intangible exploration assets (geological information on mineral reserves) and finished products (the part of the extracted minerals owned by the investor and the part owned by the State). Conclusions. As strategic minerals, oil and gas are the targets of various economic risks. Professionals familiar with the specifics of accounting operations in the implementation of the production sharing agreement should be prepared to prevent these risks. The results obtained can be used to design accounting policies and develop local regulations on the tasks and functions of the economic security service of the organization implementing the production sharing agreement.

Effective service delivery through quality management system (QMS) in oil and gas servicing companies, a case study of selected firms, Port Harcourt

2019 ◽  
Author(s):  
Chem Int
Keyword(s):  
Quality Management ◽  
Service Delivery ◽  
Management System ◽  
Oil And Gas ◽  
Quality Management System ◽  
Local Content ◽  
Port Harcourt ◽  
Test Of Hypotheses ◽  
The Impact ◽  
Effective Service

This study investigated the impact of Quality Management System (QMS) on effective service delivery in Oil and Gas Servicing Companies in selected firms in Port Harcourt, Nigeria. The opinion of 50 respondents were sampled using questionnaires, interviews as well as observation from journals and texts used in this work to examine the Quality Management System (QMS) of the selected firms. Using simple percentages and the Chi-square (X2) test of hypotheses, it was hypothetically established that the implementation of QMS practices, has impacted the work process, procedure and improvement on quality over the years in the Oil and Gas Servicing companies in Port Harcourt Nigeria. The research identified an adopted use of Failure Mode and Effect Analysis (FMEA) tool as a continual quality improvement initiative developed in the local content oil and gas servicing operation for equipment handling, management and to drive sustained improved performance quality processes as a key driver of a progressive that will place local content companies as an options for producing companies and at par with multinational oil and gas companies.

The Impact of Oil Price Fluctuations on Industry Stock Returns: Evidence from International Markets

2018 ◽  
Vol 5 (1) ◽  
pp. 1-12
Author(s):  
Elias Randjbaran ◽  
Reza Tahmoorespour ◽  
Marjan Rezvani ◽  
Meysam Safari
Keyword(s):  
Stock Returns ◽  
Oil And Gas ◽  
Negative Relationship ◽  
The United States ◽  
Oil Price ◽  
Price Variation ◽  
Price Changes ◽  
Price Fluctuations ◽  
Food And Beverage ◽  
The Impact

This study investigates the impact of oil price variation on 14 industries in six markets, including Canada, China, France, India, the United Kingdom, and the United States. Panel weekly data were collected from June 1998 to December 2011. The results indicate that price fluctuations primarily affect the Oil and Gas as well as the Mining industries and have the least influence on the Food and Beverage industry. Furthermore, in three out of six of these countries (Canada, France, and the U.K.), oil price changes negatively affect the Pharmaceutical and Biotechnology industry. One possible reason for the negative relationship between oil price changes and the Pharmaceutical and Biotechnology industries in the above-mentioned countries is that the governments of these countries fund their healthcare systems. Portfolio managers and investors will find the results of this study useful because it enables adjusting portfolios based on knowledge of the industries that are impacted the most or the least by oil price fluctuations.

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