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Autonomy Versus Alliance: An Examination of the Management and Control Provisions of Joint Operating Agreements

Andrew B. Derman, James Barnes, Proceedings of 42nd Annual Rocky Mountain Mineral Law Institute (1996)

When you pick up any business publication these days you are bombarded with articles and books addressing corporate restructuring and re-engineering, cost-efficiency, down-sizing, right-sizing and outsourcing, employee empowerment, total quality management, and other elements of a successful enterprise. The thrust generally tends to be the discovery or rediscovery of structures and behavior that facilitate communication and cooperation.

Global competition is transforming the corporate landscope by compelling companies to become lean and mean or perish. Structures and behavior that were anathema a decade ago are being tried. The same forces that are compelling corporations to change their internal structure and behavior are also compelling a reconsideration of how corporations do business with each other.

The upstream oil and gas sector is no exception. It has been mired in a deep recession, some would say depression, for the better part of the last decade. Some would say that in the present price environment, only survival is possible. Some say we have tried everything. But have we?

The upstream oil and gas sector devotes enormous energy and time to an examination of how corporations are organized and how they function. Within our companies we have developed incredibly sophisticated technology and we have assembled [4-3] enormously talented, multi-di