Course Objectives

This Joint Venture Agreement and Cash Call Course provides an overview on the collaboration in joint venture (JV) between International oil and gas companies (IOCs) and national oil companies (NOCs). This age-old arrangement is intended to among other reasons, share both exploration and financial risk among participating companies. Such organisations are referred to as JV partners while the partners choosing to manage the operation on behalf of itself and other partners is called the operator of the JV. From time to time, the operator calls upon the other JV Partners to provide funding for the operations based primarily on each partner’s equity and on approved budgets. Such calls for funding are referred to as Cash Call. The administration and accounting for Cash Call remains a major function for JV operators and partner’s Accounting and Finance, Administration, Operations and Human resource Department staff, as well as for the crude oil marketing staff.

Who Should Attend?

Accountants, Operational Auditors, Managers, Operators, Project Managers, Joint Venture Operators staff in the oil and gas industry, etc.

Course Overview

Joint Venture Agreements

Understanding a Joint Venture (JV) agreements

Proper understanding of the Joint Operating Agreement

What a Joint Venture agreement states about accounting

The Joint Venture Agreement and its management

JV contract’s fiscal policy resulting in Cash Call

Cash call qualification on basis of equity and Cash Call account reconciliation

Joint Venture Cash Management

Cash calling, invoicing, and cash management

Identification and establishment of risks register for cash call processing

Development of cash call process manuals for members

How to prepare and process a cash call

Documentation of cash call data

Challenges and opportunities in the present cash call process

The practice of cash call by other countries that have similar Joint Venture Operations

The impact of other exogenous factors

Insurance

Billing Arrangements

How to account for Joint Venture billing statements

Understanding Joint Venture Billing

How to prepare and process a Joint Venture billing statement

Joint Venture Cost Allocation

Key issues in allocating joint venture costs

How to allocate Joint Venture Costs.

Identifying the correct costs and method of allocation
Unitization and Recommendation

How to account for product and cost sharing changes following an equity redetermination

Learning Goal

This course has been designed to enable participants to

Understand the legal implications of a joint venture agreement

Understand the cash call process

Appreciate the challenges of the Exploration and Production in the oil and gas industry

The primary learning objective for this course is met through a combination of interactive presentations, discussion, and exercises.

Course Materials

Handouts, materials