Joint Operating Agreement (JOA): Updates to the Model Form
A Review of the New AAPL Form 610-2015 Model
April 26-27, 2018 | Denver, CO
Since its original version drafted by the American Association of Professional Landmen (“AAPL”) in 1956, the Joint Operating Agreement (“JOA”) Form 610 has only been revised four times; in 1977, 1982, 1989, and now, 2015. In November of 2011, a Task Force was created to revise and update the 1989 JOA to better conform to current industry standards and needs. The AAPL form of JOA is widely used to manage the relationship between oil and gas lessees designating operators to explore and develop oil and gas assets. This course will address the long-awaited updates of one of the most commonly used contractual agreements in the upstream oil and gas industry. The instructor will explain and examine the various changes made in the Model Form 610-2015 JOA.
Attendees to this course will:
- Identify the relationship between American Association of Professional Landmen (APPL) and the Joint Operating Agreement (JOA)
- Review the development of oil and gas assets
- Discuss participants of the JOA and roles of participants
- Identify term definitions and any affiliated changes
- Review the role of the operator
- Examine Articles of Form 610 and their provisions
- Analyze updates to the Articles
- Review actions for the resignation or removal of operator
- Discuss compliance with Regulatory Agencies and Government Jurisdiction
- Review the drilling and development process
- Discuss various liabilities of JOA participants
- Examine the contractual execution process
- Review of extra provisions
EUCI has been accredited as an Authorized Provider by the International Association for Continuing Education and Training (IACET). In obtaining this accreditation, EUCI has demonstrated that it complies with the ANSI/IACET Standard which is recognized internationally as a standard of good practice. As a result of their Authorized Provider status, EUCI is authorized to offer IACET CEUs for its programs that qualify under the ANSI/IACET Standard.
EUCI is authorized by IACET to offer 1.0 CEUs for this event.
Requirements for Successful Completion of Program
Participants must sign in/out each day and be in attendance for the entirety of the course to be eligible for continuing education credit.
Case studies and PowerPoint presentations will be used in this program.
Thursday, April 26, 2018
8:00 – 8:30 a.m. :: Registration and Continental Breakfast
8:30 a.m. – 5:00 p.m. :: Course Timing
12:00 – 1:00 p.m. :: Group Luncheon
The Process (Creating the New Form)
Identifying the participants in a Joint Operating Agreement and explore their roles in the process from drilling to plugging and absorbing.
- The Task Force
- Polling of Operators and Non-operators
- Horizontal Modification Form
- The Peer Review Group
Term Definition Changes
Explaining the terms used in the Joint Operating Agreement, so learners can become conversant in the language of the Joint Operating Agreement.
- Extension and Extended
- Routine Maintenance
- Rework and Workover
- Consenting Party and Drilling Party
Article III – Interests of Parties
The role of the operator visa-versa the other participants in the JOA.
- Changes to “Exhibit A”
- Share Obligation Clause of Subsection B
- Article III.B Operator Changes, Payment of Royalties, and Proportionate Shares
- Option No. 1 and Option No. 2
Article III (continued) – Acquisition, Maintenance or Transfer of Interest
The interworking’s of Oil and Gas leases and the various lease holders are an intricate part of the Joint Operating Agreement. This dynamic is explained.
- Surrender of Leases
- Transferor of a Working Interest
- Parties Relieved of Responsibility
Article IV – Titles
The role of the title and how the Joint Operating Agreement addresses title relative defects and failures.
- Failure of Title Provision
- Loss of Title Provision
- Arial and Depth Biases
Article V – Operator
The key participant in the Joint Operating Agreement is the Operator.
- Definition of Operator, Responsibilities, and Rights
- Assignability and Forfeitability of Operatorship
- Authority in Pooling Declarations and Communitization Agreements
- Standard of Performance
- Liability of Operator
- Unaffiliated Contract Operator
- Non-Owning Operator
Article V (continued) – Resignation/Removal of Operator
Removal of an Operator is a sometimes-necessary process addressed in Joint Operating Agreements and is explained in detail as to the process and the results of the same.
- Article V.B
- Voluntary Resignation
- Involuntary Resignation
- Minimum Percentage of Ownership
- Operator Bankruptcy
- Selection of Successor
Article VI – Drilling and Development
The actual drilling of the well is the most complicated in the field portion of the JOA and is examined in-depth.
- Payments/Advanced Payments
- Abandonment of Wells
- Horizontal Modification Form
Article X – Claims and Lawsuits
The various liabilities of Joint Operating Agreement participants are a key concern of not only JOA participants, but leaders, insurance carriers, and others.
- Defense of Uninsured Party
- Pro Se Defense
Friday, April 27, 2018
8:00 – 8:30 a.m. :: Continental Breakfast
8:30 a.m. – 12:00 p.m. :: Course Timing
Article XII – Notices
The question of who gets what notices and when is a key to understanding the Joint Operating Agreement.
- Electronic Mail Notices
- Best Practices Using Multiple Methods of Providing Notice
- Telegram, Telex, and Telecopier
Article XIV – Compliance with Regulatory Agencies
Whether federal, states, or local, compliance is a key aspect of a well-functioning and profitable Joint Operating Agreement.
- Operator’s Release for Actions
- Proportionate Share of Losses
- Government Jurisdiction
Article XV – Execution
The byplay between contractual obligations and their actual performance important to a high functioning Joint Operating Agreement.
- Insufficient Participation
- Return of Advanced Funds
- Costs Incurred Prior to Termination
Article XVI – Other Provisions
Although of various importance, other terms and conditions of the Joint Operating Agreement needs to be considered and applied.
- Horizon Modification JOA
- Priority of Operations for Horizontal Wells
- Order of Priority
No class can capture every issue that might come about with the Joint Operating Agreement, but additional provisions highlight important federal and legal issues that care often added to Joint Operating Agreements.
- Consequences of Non-Consent Elections
- Seismic, Downstream, Secondary Recovery, AMI, and SWD Coverage of Operating Agreement
- Order of Preference of Operations
- Power of Operator and Non-Operator
- DJ Basin Horizontal Offset Policy
Ralph A. Cantafio, Partner and Attorney, Cantafio Hammond, P.C.
With an extensive history in law and knowledge of the Oil and Gas industry, Ralph practices oil and gas law in Alaska, Colorado, North Dakota, Texas, Utah, and Wyoming. Not only is Ralph a shareholder of a law firm, with office located in Denver and Steamboat Springs, Colorado, that emphasizes oil and gas law, but he is also an adjunct professor teaching oil and gas related classes. Ralph currently teaches in the Global Energy Management Program taught at the University of Colorado Denver. Mr. Cantafio has also lectured foreign professionals, primarily from Nigeria and China, focusing on international oil and gas law, industry, as well as international natural resources law.
His education includes not only a Juris Doctorate from the University of Colorado School of Law, but a Master of Science in Mineral Economics from the prestigious Colorado School of Mines and a Master of Science in Global Energy Management from the University of Colorado-Denver, where he now teaches.
With two professional oil and gas certificates in Petroleum Land Management and Energy Finance from the University of Denver, numerous professional affiliations, publications as well as numerous industry presentations, Ralph’s knowledge of the oil and gas industry is extensive.
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