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CoursesealsOil and Gas
  • CHAPTER 1: INTRODUCTION AND BACKGROUND TO THE OIL AND GAS INDUSTRY 4

    In this section, we broadly discuss the following background concepts to the oil and gas industry: 1.1 Introduction to Oil and Gas hydrocarbon system elements and the formation of oil and gas; exploration, development and production activities including the types of drilling shale gas basics 1.2 Sector organisation 1.3 Market and Pricing 1.4 Oil and Gas in Africa History and overview Future developments

    • Lecture1.1
      INTRODUCTION TO OIL AND GAS 30 min
    • Lecture1.2
      SECTOR ORGANISATION 30 min
    • Lecture1.3
      MARKET AND PRICING 30 min
    • Lecture1.4
      OIL AND GAS IN AFRICA 30 min
  • CHAPTER 2: OIL AND GAS PROCESS AND KEY CONCEPTS 3

    • Lecture2.1
      OIL VS GAS – TECHNICAL EXPLANATION 30 min
    • Lecture2.2
      OVERVIEW OF OIL AND GAS INDUSTRY PHASES 30 min
    • Lecture2.3
      CONTRACTUAL STRUCTURE 30 min
  • CHAPTER 3: LEGAL FRAMEWORK 3

    • Lecture3.1
      RESOURCE OWNERSHIP AND LICENSING 30 min
    • Lecture3.2
      UPSTREAM CONTRACTS – TYPES OF COMMERCIAL AGREEMENTS 30 min
    • Lecture3.3
      UPSTREAM CONTRACTS: TYPES OF HOST GOVERNMENT CONTRACTS 30 min

    CONTRACTUAL STRUCTURE

    Types of Agreement

    This chapter aims to provide a brief synopsis of the main types of agreements encountered in the oil and gas sector and their use. These contracts will be discussed in more detail in Chapter 3.

    Projects require different forms of contract at different stages of a project development covering upstream to midstream to downstream value chain. Preliminary documents could include heads of agreement, term sheets and memorandum of understandings.

    The main types of agreements include:

    ·         Licences or Concession Agreements

    ·         PSA

    ·         Joint Operating Agreements (JOA)

    ·         Farm-in / Farm-out Agreements

    ·         Unitisation Agreements

    ·         Drilling Contracts

    ·         Decommissioning Agreements

    Functions of the agreements

    • Joint Operating Agreement
    • Take the form of a contractual joint venture for exploration and production activities. This agreement will be used in order to deal with exploration, appraisal, development, producing, lifting and transportation. It therefore has application across the upstream, midstream and downstream phases of the industry. It provides a basis for the allocation of rights, responsibilities and liabilities under the PSA or the Concession/Licence agreements, and manages the relationship between operators and non-operators.
    • Farm-in / Farm-out agreement

    This form of agreement permits a company to acquire or diversify their oil and gas interests outside licensing rounds. It is often used as a means of managing asset portfolios.

    • Unitisation agreement

    An agreement between the various owners of a single oil field which extends into more than one licence area, in order to develop that field as a single unit. The Unitisation Agreement normally includes all the provisions of a joint operating agreement together with additional ones which are intended to establish the rights of the respective parties to the production from the field.

    • Drilling contracts

    There are three main types of contracts:

    o   Day rate contracts are the most popular. The operator of a drilling project will pay a day rate to the drilling contractor in exchange for the contractor providing the rig, the drilling personnel and other incidentals.

    o   Footage contract the drilling contractor is paid to drill to a specified formation or depth. The drilling contractor is paid a set amount per foot drilled, and is given broad control over how to do the work.

    o   Turnkey contract in exchange for an agreed price the drilling contractor promises to perform specified functions. The operator does not have any discretion to control the drilling contractor, and so assumes little or no liability for damages that the drilling may cause.

     

    Prev OVERVIEW OF OIL AND GAS INDUSTRY PHASES
    Next RESOURCE OWNERSHIP AND LICENSING

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