Abstract

One section of the Model Joint Operating Agreement (JOA) endorsed by Association of International Petroleum Negotiators (AIPN) seriously deals with "Operations by Less Than All Parties". Once a Party who elects not to participate in an operation (Non-consenting Party), Non-consenting Party shall focus to be indemnified from "any and all" costs and liabilities arising from such exclusive operation. This paper presents a practical mechanism and innovative application of operating expenses (OPEX) allocation for an Indonesian offshore Production Sharing Contact (PSC) block in the year of 2012, having Non-consenting Party, 20% Participating interest (PI) holder in this block save 29% of OPEX, amounting to several millions of US Dollars.

Keywords:
entire block, allocation, indirect opex, operation well, current year, exclusive operation, mechanism, reservoir surveillance, production monitoring, equivalent production
Subjects:
Well & Reservoir Surveillance and Monitoring, Asset and Portfolio Management
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2014. International Society of Offshore and Polar Engineers
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