The Agreed Delay

[jft310]

Legally you can not switch appraisers at will . The regulators call that shopping appraisers and as you might guess is not allowed .

[ArtM72]

Legally you can not switch appraisers at will . The regulators call that shopping appraisers and as you might guess is not allowed .

I'll give you the simple "legal" basis for IOC getting rid of GLJ: incompetence.  After several additional wells, long term flow tests and God nows how many kilometers of new seismic if GLJ refuses to reduce its estimates based on likely misjudgements then IOC says, "They gone" and no regulator would ever challenge that.  One change after over a decade can not be considered "shopping" by anyone other than someone desperately trying rationalize a poorly based (biased?) opinion.

[ArtM72]

Requires a unanimous vote . Others may be waiting on the OSH results ????

Since when does any non-contractual well require a "unanimous" vote in any joint venture?  That's goofy. The only organization I know that "runs" with a rule like that is the US Senate. God help us if Hession's negotiations have put IOC in a JV on par with that deliberative body.

[katytrader]

Legally you can not switch appraisers at will . The regulators call that shopping appraisers and as you might guess is not allowed .

I'll give you the simple "legal" basis for IOC getting rid of GLJ: incompetence.  After several additional wells, long term flow tests and God nows how many kilometers of new seismic if GLJ refuses to reduce its estimates based on likely misjudgements then IOC says, "They gone" and no regulator would ever challenge that.  One change after over a decade can not be considered "shopping" by anyone other than someone desperately trying rationalize a poorly based (biased?) opinion.

GLJ incompetence?   Hession is on record saying that GLJ has got it right "again and again."   And you want GLJ to REDUCE its estimates?   Good grief!!

And as for the unanimous vote question, one doesn't need to parse any agreement to understand that no partner would have carte blanche to drill at will on jointly held property.  And it is unlikely that any of the three partners would agree that the others could proceed without its concurrence.

[Palm]

Actually it is not uncommon for JOAs to have clauses which allow "exclusive operations" Katy for obvious reasons. Should an Operator feel the best option is to do X, a JOA participant can choose to sit out of X thereby forfeiting rights to whatever X produces. Most standard JOAs include such language.

[katytrader]

Actually it is not uncommon for JOAs to have clauses which allow "exclusive operations" Katy for obvious reasons. Should an Operator feel the best option is to do X, a JOA participant can choose to sit out of X thereby forfeiting rights to whatever X produces. Most standard JOAs include such language.

Lawyers write clauses to cover all sorts of unknown contingencies but the partners have a mutual interest in making agreements work with minimal conflict (unless someone wants to back out)  In this instance, Hession has referred to a joint decision regarding A7.   Exclusive operations by the Operator without bringing the others along in agreement can lead to a LOT of problems......but here I don't think we are talking about TOT doing anything on its own (are we?)

[Putncalls]

It's just more convenient to do more due diligence during this down cycle. Total slows down it's cash outflow while bargaining in an oversupplied market, MH keeps his salary because IOC has no known value and there is due diligence. Does the project lose a year or so because of the delayed certification?

[Stavros]

No extension of Project Schedule to my opinion, Putz
See my post on this issue

[ArtM72]

The delayed certification has no effect whatsoever on the LNG project schedule and Total's cash flow plans should have no effect on their responsibility to trigger certification by declaring A6 testing complete.

What delayed certification does effect is IOC's ability to discover, appraise and develop its other properties. How many times did Hession tell us that is the Company's mission and his focus? That work has stopped cold. Why? It's not because of any focus on the LNG plant. THAT is in the hands of Total and Total has no need of any help from IOC in that regard. Delayed certification lies at the heart of what is increasingly looking like corporate corruption.

Connect the dots and you get a picture of subversion and erosion.

[Putncalls]

Corporate corruption? Since when has corruption been just a corporate thing? Corruption is a human condition. Corporations exist because smart people understand the nature of people.