business developments, ji europe evaluation possibilities belief there is a spectrum of tools that...

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BUSINESS DEVELOPMENTS, JI EUROPE Evaluation Possibilities Belief There is a spectrum of tools that can be employed to address commercial barriers. There is a spectrum of how severely they can be implemented. Objective, systematic analysis of the problem areas, together with existing anecdotal information will help guide where in these spectra we should be focusing our efforts. A foundation of objective and systematic analysis will be critical in winning the hearts and minds of both Industry and Government. Evaluation Objectives Quantify materiality Characterize problem areas

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Page 1: BUSINESS DEVELOPMENTS, JI EUROPE Evaluation Possibilities Belief There is a spectrum of tools that can be employed to address commercial barriers. There

BUSINESS DEVELOPMENTS, JI EUROPE

Evaluation Possibilities

Belief

There is a spectrum of tools that can be employed to address commercial barriers. There is a spectrum of how severely they can be implemented.

Objective, systematic analysis of the problem areas, together with existing anecdotal information will help guide where in these spectra we should be focusing ourefforts.

A foundation of objective and systematic analysis will be critical in winning the hearts and minds of both Industry and Government.

Evaluation Objectives

Quantify materiality

Characterize problem areas

Page 2: BUSINESS DEVELOPMENTS, JI EUROPE Evaluation Possibilities Belief There is a spectrum of tools that can be employed to address commercial barriers. There

BUSINESS DEVELOPMENTS, JI EUROPE

Correlation Between Time to Development and Asset Churn

(Years)

Discovery to

development

sanction

3rd Dimension

Size of field

Size of partner change

Hydrocarbon type

Gulf of Mexico

No times partner change

and/or No times Operator change

Page 3: BUSINESS DEVELOPMENTS, JI EUROPE Evaluation Possibilities Belief There is a spectrum of tools that can be employed to address commercial barriers. There

BUSINESS DEVELOPMENTS, JI EUROPE

Correlation Between Time to Development and No of Partners

(Years)

Discovery to

development

sanction

3rd Dimension

Size of field

Hydrocarbon type

Gulf of Mexico

No of partners at development sanction

Page 4: BUSINESS DEVELOPMENTS, JI EUROPE Evaluation Possibilities Belief There is a spectrum of tools that can be employed to address commercial barriers. There

BUSINESS DEVELOPMENTS, JI EUROPE

Existing Commercial Barriers

Barriers to development for fields discovered up to 1998 but no development sanction by end 2001.

1. Technology / reserves

2. Await appraisal

3. Await development selection

4. Await infrastructure ullage

5. TPOSA terms

6. TPOSA tariff

7. Unitisation terms

8. JOA/UOA terms

9. Other. 1. 2. 3. 4. 5. 6. 7. 8. 9.

No assets

and/or

Reserves

Page 5: BUSINESS DEVELOPMENTS, JI EUROPE Evaluation Possibilities Belief There is a spectrum of tools that can be employed to address commercial barriers. There

BUSINESS DEVELOPMENTS, JI EUROPE

Comparison of Commercial Practice

(UK, Norway, Germany, Canada, Australia)

Legislated Voluntary Practiced Describe

Standard contracts - A&D N N -- JOA Y - -- UOA N N- Unitisation N N -- Transport N Y Y- Processing N Y Y

Published TPOSA terms N Y NPreemption excluded Y - -Standard process for resolution Y Y Y

Page 6: BUSINESS DEVELOPMENTS, JI EUROPE Evaluation Possibilities Belief There is a spectrum of tools that can be employed to address commercial barriers. There

BUSINESS DEVELOPMENTS, JI EUROPE

Next Steps

1. Agree which (if any) evaluation is required.

2. Agree sponsors, industry (and DTI).

3. Sponsors to engage analysts (e.g. Woodmac) and make final proposal to Workgroup early Sept.

4. Results end Oct.