Basic Concepts
• The nature of “joint operations”
• History of and working with the AAPL Model Form Operating Agreement
• Pitfalls in the Model Form
Overview of the Model Form General Matters
• Scope of the joint operations
• Definitions and exhibits
Interest of the Parties
• Interest in cost and production
• Payment of royalties
Taking Production in Kind
• In general
• Gas balancing in “split stream” or “gas storage” situations
Conduct of Operations under the Model Form
• The operator
– Powers and responsibilities
– Eligibility, resignation, removal, and replacement
– Expanded responsibilities under the 1989 version
• Procedure for the conduct of operations
– Types of operations and operator’s authority
– Proposing and conducting operations
- The initial well
- Subsequent operations (subsequent wells, “Wellbore” operations, horizontal wells)
- “Notice,” including 1989 revisions
- Cost overruns, conflicting proposals, and modifying or
terminating the operation
• Special problems of consent/non-consent operations
Unit Administration: Non-performing Parties
• In general
• Remedies against a non-performing operator
• Remedies against defaulting or potentially defaulting party
– Available remedies under prior versions of the Model Form
– Additional remedies under the 1989 Model Form
– Suggested additional changes