By the end of this programme, participants will be able to:
- Understand the key concepts, principles, and rules governing Production Sharing Agreements (PSAs).
- Analyze the contractual obligations binding petroleum companies with ministries and/or state oil companies.
- Assess the management of petroleum exploration and production partnerships for successful hydrocarbon discovery and production.
- Navigate the practical aspects of PSAs and Joint Operating Agreements (JOAs), including identifying key issues, addressing constraints, managing deadlines, and interpreting essential contractual documents.
Day 1
Introduction to Production Sharing Agreements (PSA)
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- Origins, concept, and scope of PSA
- Comparison with other oil industry contracts
- Structure and key components of a PSA contract
- PSA mechanisms: cost oil, profit oil split, “Government Take”
- Financial elements: bonuses, cost recovery ceilings, uplifts, government “back-in”
- PSA cash flow forecasts and analysis
- Case studies: Review of selected PSA clauses
Day 2
Joint Operating Agreements (JOA) – Fundamentals
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- Purpose and role of JOAs in joint ventures
- Relationship between JOAs and other contracts
- Key components of a JOA: structure, definitions, terminologies
- Roles and responsibilities:
- The operator: appointment, duties, resignation, liabilities
- The partners: roles, rights, and responsibilities
- Operating committees: establishment, powers, voting, decision-making
Day 3
JOA – Operations and Risk Management
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- Work programs and budgets: exploration, development, production
- Tendering, awards, and AFE procedures
- Sole risk/non-consent clause: procedure, penalties, responsibilities
- Production disposal: rights and obligations
- Permit/concession/block management: surrender, renewals, well abandonment
- Managing risks within the JOA framework
Day 4
Legal, Financial, and Practical Aspects
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- Legal considerations: dispute resolution, transfer of rights, confidentiality
- Accounting procedures: budgets, audits, overheads, payments, inventories
- AIPN model contract: overview and practical application
- Case studies: interactive exercises on PSA and JOA negotiations
