The 10 Days Oil & Gas Contract Training

This course will provide participants with comprehensive understanding of the full spectrum of oil and gas contracts.  It is a highly interactive training covering the key legal and commercial aspects of these contracts and the inherent risks in the different types of contracts. Participants will learn how to deal with negotiating, drafting and administrating these contracts in the oil and gas and marine sectors. Further we will also focus on the pros and cons of the different types of contracts and the suitability of each one for your specific needs. We delve into specific contracts like Production Sharing Contracts (PSC), Licensing and Concessions used in upstream operations and EPCIC (Engineering, Procurement, Construction, Installation & Commissioning) Contracts, EPCM and Alliance contracts used for complex offshore and onshore projects.

Understanding the allocation of risk by mastering the ins and outs of these contracts will prove to be a valuable tool in driving effective contracting strategies to minimize risks and liabilities. Further, in this course participants will also enhance their knowledge and raise their awareness of best practices in managing the supply chain process which culminates in the awards of these contracts to the right party. Participants learn to appreciate how best to deal with the ripple effects of major disasters by looking at case studies like the Deep Water Horizon – Macondo Blowout and the lessons learned from that episode. Limiting of liabilities with contractual provisions like knock for knock indemnities and other contractual clauses to mitigate risk exposure in oil and gas contracts.

It is specifically designed to provide participants with a well-tested and practical guide on

• Major types of oil and gas contracts and the key clauses to master
• Evaluate different contracting strategies and their inherent risks, liabilities and benefits
• Fully appreciate the legal and commercial risks and how best to manage these risks
• Appreciating the main aspects of upstream contracts like Production Sharing Contracts, Concessions and Licenses
• Putting EPCIC contracts in the context of the different models of EPC Contracts
• Comparing the EPC contracts with EPCM and Alliance Contracts and knowing their benefits and disadvantages
• The challenges of EPCIC lump sum contracts and the ways to manage cost over-runs
• Structuring the contract to address the issues of the several parties to the contract to ensure a positive project outcome
• Pros and Cons of the split EPCIC contract form
• Insights into the current issues affecting oil and gas contracts like pollution, HSE and local content
• Best practice in supply chain management
• International dispute resolution frameworks
• Negotiation Strategies and Negotiation Techniques to help you become a better negotiator of contracts and contractual claims resolution

Course Objectives

Upon successful completion of this course, each delegate will be able to

• Appreciate the uses of various types of oil and gas contracts
• Identify, assess and manage key contractual risks
• Understand fully the EPCIC contracts and assess operational, commercial, legal and financial risks
• Compare the difference between EPCIC, EPCM and Alliance contracting methods
• Appreciate the essential elements of the different contract stages from pre to post tender then on to completion and delivery of project
• Address key issues faced during project lifecycle and how to tackle these through enforceable contractual clauses
• Avoiding pitfalls and ambiguous contractual terms
• Evaluate the most appropriate way to dispute resolution
• Perform more confidently in negotiations

Organizational Impact

• Providing contract management team with a fresh and rational approach to contracting
• Analyzing and solving contract problems before they cause organization in time and money
• Provide an eye-opener on the importance of clarifying contract ambiguities prior to signing of contracts
• Gives procurement and other project personnel fresh insights into negotiating of contracts
• Strategizing on risk management techniques that can be used in the contracts to safeguard organizations interests
• Senior management given options that are available to enable them to negotiate better terms and conditions of for upstream and downstream contracts
• Enhancing internal management capacity to manage contractual risks
• Exploring alternative ways of reducing the impact of risks and disputes on the organization

Personal Impact

• Having a one-stop reference on all aspects of oil and gas contracts and effectively dealing with the problems that may arise
• Appreciating the different nature of oil and gas contracts
• Familiarizing themselves with different contract clauses
• Dealing with Changes to contract terms, and differences in approach between standard contracts and bespoke contracts
• Detailed understanding of contract documents required for creation of an Oil and Gas Contracts and in particular EPCIC, EPCM and Alliance contracts
• Obtaining thorough guidance on contract negotiation techniques
• Knowledge of different contracting strategies to meet organization’s goals
• Applying supplier performance management techniques
• Reviewing the most appropriate forms of dispute resolution
• Enhancing your ability to effectively negotiate with confidence

Who Should Attend?

This course is suitable to a wide range of professionals but will greatly benefit Contracts and Procurement Professionals and Project Managers operating in complex offshore and onshore projects both in oil and gas and marine contracts whether at beginner, intermediate or advance levels including:

• Project and General Management
• Commercial and Contract Professionals
• Commercial Operation Professionals
• Contract Engineers, Administrator and Managers
• Procurement Supply Chain Professionals
• Risk Manager / Contract Risk Professionals
• Procurement Managers and Purchasing Staff
• Engineering, Operational and Maintenance Personnel
• Commercial, Financial and Insurance Professionals

Course Outline

The course consists into two modules
MODULE I - Oil & Gas Contracts
MODULE II - Contract Management in Offshore & Marine, EPCIC and Shipyard

Module I: Oil & Gas Contracts

DAY 1

Principal Types of Oil and Gas Contracts

• Principles of Petroleum Law and Industry
• Exclusivity, Mutual Interest and Confidentiality
• Concessions / Licenses
• Leases and Rentals
• Services and Works Agreements
• Multi-Party Contracts

DAY 2

Managing the Supply Chain Process

• Overview of Procurement Best Practice
• Developing the Scope of Work
• Qualifying Suppliers
• Managing the Supply Chain
• Contract Award and Execution
• Bribery and Corruption

DAY 3

Key Contractual Issues and Their Management

• Performance and Penalties
• Liabilities and Indemnities
• Pricing and Payment
• Force Majeure
• Termination
• Local Content Requirements

DAY 4

Managing Contractor Performance

• Identifying and Managing Supplier Risk
• Service Level Agreements
• Key Performance Indicators
• Changing the Scope of Work
• Limiting and Excluding Liability
• Use of Bonds, Guarantees and Warranties

DAY 5

Dispute Management in the Petroleum Industry

• Damages and Other Remedies
• Negotiation, Compromise, Settlement
• Alternative Third Party Dispute Resolution
• Litigation or Arbitration?
• Enforcement Measures
• Open Forum – Questions and Final Review

Module II: Contract Management in Offshore & Marine, EPCIC and Shipyard

DAY 6

EPCIC Overview, Legal Framework & Contract Structure and Risk Allocation

• Maximizing parties rights and interests with appropriate contracting strategy
• Contractor’s Single Point of Responsibility
• Split Contract Structures
• EPCIC aspects in Shipbuilding Contracts for “Floaters”
• Choosing the right contract structure for your project
• The Tender Process, Tender and Award
• Discussing and Analyzing Different Strategies

DAY 7

Tender Process Leading to an EPCIC Contract

• Legal, Technical and Commercial Pre-qualification of Tenderers
• Best Practices in Tender Evaluations and Selection of Tenderer
• Important of Scope of Work and Specifications and Terms and Conditions
• Exceptions – What to accept and What to deny
• Finalizing Tender Negotiations & Award
• LOI and LOA Essential Terms and Legal Effects
• Exercise on the selection process and main elements to ensure a successful tender exercise

DAY 8

Negotiating Essential Contractual Terms of EPCIC Contracts

• Identifying Critical issues in the Project Life-cycle
• Managing Cost impact clauses like delay, price fluctuations
• Indemnities and other liabilities, MAC clauses, HSE
• Changes in Law and Regulations in Host Country & Stabilization Clauses
• Political Risk Insurance
• Force Majeure & Termination for Cause and Without Cause
• Case Study & Drafting Exercise Issues Faced During Contract Life Cycle by Aligning Contractual Terms to Project Management
  • Managing Coordination Issues
  • Handling Completion Issues
  • Liquidated Damages
  • Dispute Resolution
  • Enforcing of Commencement and Completion Dates

DAY 9

Essential Aspects of Risk Management Strategies

• Design, Technology & Process Risk
• Procurement & Specification risk
• Variations and Cost Impact
• Payment and Multi-currency Contracts
• Delay and Liquidated Damages
• Completion and Testing & Effects of Acceptance
• Using Contractual Clauses to Manage Liabilities and Risks

DAY 10

Contract Completion – Critical Issues

• Acceptance of Punch List of defects - What is the effect?
• Passing of Tile and Risk - safety & insurance
• Warranties and Guarantees
• Passing of Intellectual Property Rights
• Defects - Exculpatory Clauses
• Dealing with Disputes – considering the different options
• Discussion on Issues Participants have faced and how it was handled

Course Fees

To be advised as per the course location. This rate includes participant’s manual, Hand-outs, buffet lunch, coffee/tea on arrival, morning & afternoon of each day.

Course Certificate

International Center for Training & Development (ICTD) will award an ICTD Completion Certificates and IAOSHE international certification for each delegate on completion of training.

Course Methodology

A variety of methodologies will be used during the course that includes:

• (30%) Based on Case Studies
• (30%) Techniques
• (30%) Role Play
• (10%) Concepts
• Pre-test and Post-test
• Variety of Learning Methods
• Lectures
• Case Studies and Self Questionaires
• Group Work
• Discussion
• Presentation

Course Timings

Daily Course Timings
08:00 - 08:20       Morning Coffee / Tea
08:20 - 10:00       First Session
10:00 - 10:20       Coffee / Tea / Snacks
10:20 - 12:20       Second Session
12:20 - 13:30       Lunch Break & Prayer Break
13:30 - 15:00       Last Session