Course Overview

This course on International Petroleum Agreements will teach you the philosophy, evolution, and fundamentals of international petroleum contracts and have an opportunity to see how each of these actually works. You will take part in life-like how to use negotiation techniques to build a negotiation template for an oil agreement to optimize the economic outputs. As you prepare for each session, you use a computerized economic model to assess the value of contract terms. This enables improved planning of negotiating strategies to achieve the desired goals by the two parties (government and international company). A win-win business arrangement should be the objective of both parties, as a signed contract makes them partners. A viable contract cannot be negotiated without an effective understanding of the underlying economics. Negotiating strategies will determine contractual terms ultimately defining the economic benefits to be realized.

Concessions (Tax and Royalty), production sharing agreements, Joint venture, and services agreements will be studied in this cours. But, concessions (Tax and Royalty) and production sharing agreements are two of the contract types to be evaluated. Each participant receives a disk copy of the spreadsheets used in the negotiation workshop, which explains the fundamental principles of E&P contracts, presents examples of economic analysis, and includes a model contract.

You Will Learn

How To:

1. Distinguish between different types of contracts
2. Understand the economics terms of an E&P contract
3. Determine the economic value of various contract terms
4. Negotiate and assess the value of contractual terms

Course Content

1. Types of international petroleum contracts
2. Important principles and terms in all contracts
3. Host governments and contractors contract objectives
4. Specific features of different types of contracts; dividing the production
5. Outline of a typical contract for E&P
6. Contract operating issues
7. Funding petroleum development programs
8. How the contractor is paid
9. Contractor’s risk
10. Contract economics
11. Non-financial issues
12. Analysis of contract provisions
13. Model contract
14. Natural gas production under international contracts
15. Negotiations workshop
16. Ethics in international petroleum operations