scholarly journals Independent Operations, Obligatory Operations and Challenge of Operator Provisions in Joint Venture Agreements

1970 ◽  
Vol 8 (2) ◽  
pp. 216
Author(s):  
W. G. Brown
Keyword(s):  
Joint Action ◽  
Joint Venture ◽  
Oil And Gas ◽  
Oil And Gas Industry ◽  
Gas Industry

Although the concept of a joint venture is one of joint action, joint venture agreements in use in the oil and gas industry contain provisions for independent operations. This article discusses the need for independent operations clauses, the types of independent operations clauses, including obligatory operations clauses, the types of penalties and general problems which should be considered in the drafting of independent operations clauses. The article concludes with an analysis of the challenge of operator provisions in joint operating agreements.

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 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 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.

What is best practice greenhouse and energy reporting in the oil and gas industry?

2010 ◽  
Vol 50 (2) ◽  
pp. 695
Author(s):  
Liza Maimone ◽  
Susie Smith ◽  
Rob Campbell-Watt
Keyword(s):  
Best Practice ◽  
Energy Use ◽  
Joint Venture ◽  
Oil And Gas ◽  
Oil And Gas Industry ◽  
Intermediate Energy ◽  
Gas Industry ◽  
Uncertainty Estimates ◽  
Reported Data

The upstream oil and gas industry is diverse and many of the assets are geographically dispersed in offshore and onshore locations. The first year of National Greenhouse and Energy Reporting (NGER) in the 2009 financial year (FY09) challenged the industry to come to terms with complex issues such as the reporting structure, defining facilities, determining appropriate reporting methodologies, determining incidental emissions, obtaining contractor emissions and considering uncertainty estimates. This paper will explore the range of industry responses during FY09 and will be accompanied by a case study from Santos Limited to illustrate the journey. In responding to NGER requirements in FY09, the oil and gas industry was required to absorb many new legislative compliance obligations. At a company level, difficult decisions had to be made about the allocation of resourcing for NGER preparation and response. Companies were also faced with financial implications of the reported data, because that data would underpin permit liability under the proposed Carbon Pollution Reduction Scheme (CPRS). Going forward, a key optimisation challenge for FY10 and beyond is the management and use of the NGER data. This paper will cover the processes and systems used to collect and report data and how the use of that data for organisational decision making will all be an important optimisation consideration in a CPRS environment. The paper will also explore other NGER reporting issues for the oil and gas industry, such as: arrangements with stakeholders, such as joint venture parties, partners and contractors; selection of measurement methods, including complexities with venting, flaring and other fugitive emissions; availability of appropriate measurement equipment; issues with reporting of own-use emissions and intermediate energy use and production; and, measurement of exploration activities. These issues are likely to present an optimisation challenge to many in the industry during FY10 and beyond. The paper will then conclude with a case study by Santos Limited.

Training collaboration in Australia

2016 ◽  
Vol 56 (2) ◽  
pp. 573
Author(s):  
Michael Lynn ◽  
Veronica Holmes
Keyword(s):  
Workforce Development ◽  
Joint Venture ◽  
Ad Hoc ◽  
Oil And Gas ◽  
Service Providers ◽  
Oil And Gas Industry ◽  
Training Model ◽  
Gas Industry ◽  
World Class ◽  
Industry Culture

It is 2020 and the Australian oil and gas industry has experienced unprecedented growth. The transition to steady-state operations has been hugely successful. Australia is now well and truly on the global map for oil and gas, and is regarded as world class. Trades and technical operators are skilled, experienced, and safely delivering their jobs. The Australian collaborative training model has been successfully in place for three years, and operators and contractors are satisfied with its impact. But how did the industry successfully make this happen? Looking back to 2015, there were a number of ad hoc collaborative strategies in place to provide oil and gas related skills in Australia. The economic environment at that time, however, necessitated a new look at the collaborative mechanism for reducing operating costs and realising greater efficiencies on workforce development related activities. In 2015, the Resources Industry Training Council (a joint venture between APPEA and CME) identified workforce development collaboration opportunities, and to articulate the value that could be realised from these opportunities. This project sparked a successful Australian collaborative model for workforce development. A unique FutureNow visioning presentation will be used to bring to life a world in 2020 where workforce development collaboration is intrinsic to Australian operators’ DNA, and why and how it stuck this time round. The value will be clearly identified in terms cost optimisation, building an industry culture of trust, and how this was used as a springboard for other successful collaborative opportunities. FutureNow is a fictional representation of the Australian oil and gas industry in 2020, using storytelling to explain a possible journey and outcome for the operators, service providers, workforce, and training bodies.

Intellectual property in the petroleum production and exploration sector—the other hidden asset

2015 ◽  
Vol 55 (2) ◽  
pp. 447
Author(s):  
Tim O'Callaghan
Keyword(s):  
Intellectual Property ◽  
Joint Venture ◽  
Oil And Gas ◽  
Oil And Gas Industry ◽  
Petroleum Exploration ◽  
Sensitive Material ◽  
Gas Industry ◽  
Production Sector ◽  
Intellectual Property Management ◽  
Exploration And Production

According to IBISWorld (2013), 7.7% of Australia’s A$11 trillion assets are natural resources and 5.4% is intellectual property. Despite this intellectual property is overlooked as a valuable asset in the oil and gas industry. As the means of extraction become more complex, the methods and tools needed for the purpose can give one company an edge over another. Intellectual property rights help to protect that competitive advantage. Companies need to have a strategy for the early identification, management and protection of this asset. Customers, contractors and joint venture partners can create intellectual property ownership issues that must also be identified and properly managed. This extended abstract provides: a framework for establishing a robust intellectual property management strategy for companies in the exploration and production sector; identification of key intellectual property assets of businesses in the sector; a review of industry specific challenges, such as the requirement under WA’s Petroleum and Geothermal Energy Resources (Environment) Regulations 2012 to disclose trade secrets and commercially sensitive material about downhole substances; and, consideration of model agreements used in the sector, such as the AMPLA Model Petroleum Exploration Joint Operating Agreement.

scholarly journals Third Party Logistics Outsourcing: An Exploratory Study of the Oil and Gas Industry in Nigeria

SAGE Open ◽  
2017 ◽  
Vol 7 (4) ◽  
pp. 215824401773556 ◽  
Author(s):  
Emah Patrick Etokudoh ◽  
Mehraz Boolaky ◽  
Mridula Gungaphul
Keyword(s):  
Joint Venture ◽  
Oil And Gas ◽  
Service Providers ◽  
Scale Up ◽  
Oil And Gas Industry ◽  
Business Environment ◽  
Host Community ◽  
Gas Industry ◽  
Logistics Outsourcing ◽  
Oil Companies

Not much has been researched in logistics outsourcing in the emerging countries, particularly in the oil and gas industry. This article investigates the feasibility of logistics outsourcing by the international oil and gas companies in the emerging business environment of Nigeria. An exploratory, multicase, qualitative approach was applied, involving 40 interviewees in three international oil companies and three of their logistics service providers. Findings reveal that vendors’ capabilities, host community issues, joint venture influence, and employees’ reactions challenge international oil companies’ logistics outsourcing implementation while relationship management, contract management, and change management skills enable them handle these challenges. The results also show that surveyed organizations implement logistics outsourcing piecemeal and need to scale up their current capabilities to effectively integrate logistics outsourcing. The research confirms logistics outsourcing is achievable in Nigeria, but requires synergies and symbiosis between the oil companies and their local vendors.

scholarly journals Limited Partnerships in the Alberta Oil and Gas Industry

1978 ◽  
Vol 16 (2) ◽  
pp. 153
Author(s):  
R. G. Powers
Keyword(s):  
Joint Venture ◽  
Oil And Gas ◽  
Oil And Gas Industry ◽  
Gas Industry ◽  
Limited Partnership ◽  
The Law ◽  
Partnership Agreement ◽  
Limited Partnerships

Limited partnerships, as financing vehicle in the oil and gas industry, are gaining popularity. This paper reviews the law relating to limited partnerships in Alberta, emphasizing those problems of particular significance in the formation of such partnership for participation in the oil and gas business. Relevant provincial and federal statutory provisions are considered, and draft Partnership Agreement is set out. The author also highlights the distinctions between the limited partnership, joint venture, and operating agreement.

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.

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