Exploration

Exploration requires an in-depth understanding of business objectives, legal considerations and the prevailing regulatory environment. Moreover, joint operations between E&P companies add an extra, but necessary layer of complexity to ensure that the risks and rewards are properly and adequately shared.

The vast majority of Farm-out Agreements and Joint Operating Agreements are based on Association of International Petroleum Negotiators (AIPN) model contracts and are usually concluded under English law. However, where operations are located in civil law jurisdictions, then a proper evaluation and consideration of local law is required to fully understand the ramifications of relying on a different legal system or the interplay between the two in other cases. We have worked on a number of transactions in civil law jurisdictions, where we have adapted contractual arrangements to satisfy local requirements and where we have a demonstrable track-record of ensuring our clients achieve their business objectives.

Exploration requires an in-depth understanding of business objectives, legal considerations and the prevailing regulatory environment.

We have expertise in the development of corporate structures and procedures to assist operators optimise their exploration activities, taking into account local regulatory restrictions, such as single-holder exploration and production licenses as well as non-delineation of license areas, by the creation of special purpose companies, governed by a shareholders agreement and the appointment of an operator under an operator service contract. In particular, the crucial issues of operator liability and the no-loss/no-gain principle of operatorship and also the consequences of default by any participant.