About the Masterdeed Article of Siddharth Gyaltsen of Herbert Smith - 'New transfer and pre-emption arrangements for the UKCS' PPWG Presentation - Industry Wide Masterdeed The Oil & Gas UK / PPWG "Masterdeed" The "Master Deed" was developed by Oil & Gas UK Progressing Partnership Working Group (PPWG), BERR, and a number of other interested organisations. It greatly expedites the transfer of UK Continental Shelf (UKCS) offshore licence interests and other agreements relating to associated assets and infrastructure. It also introduces a standard pre-emption regime to give confidence to incoming companies. The offshore oil industry has given the Master Deed broad
support, nearly 260 companies holding more than 99% of licence interests
have signed up already. Under former practice, a deal could be significantly delayed by the need to get a range of signatures applied to many documents, even when all parties are content with it. The Master Deed creates a mechanism which simplifies the complex and time-consuming procedures which were previously involved in the sale and purchase of offshore licence interests in the UKCS. Under the Master Deed, licensees have appointed UKCS Administrator Limited to act as an administrator to the Master Deed and perform the execution of pro-forma documents. The use of pro-forma ensures that the documentation process is faster and less complex. UKCS Administrator Limited is a specially created subsidiary of Oil & Gas UK. The service will actually be provided by LOGIC (the 'Service Provider') on behalf of the UKCS Administrator Limited under a separate 'Services Agreement'. At the time of submission the disposing company will pay to LOGIC a small fee for the service, currently £500 + VAT for transactions involving up to 5 consents. Further details on the transfer/documentation process can be found under 'Submit Documents'. Use of the New Transfer Arrangements is voluntary for the party
disposing of its interest. The New Transfer Arrangement does not
affect any existing rights of objection to an assignment or provisions
granting or withholding consents. A number of new entrants have expressed concerns to BERR about the risk of being pre-empted even after extensive (and expensive) negotiation to conclude a deal. The standardised new arrangements replace the range of provisions that existed previously (though they do not take effect where there had been none before), giving buyers confidence and clarity. When informed of a proposed licence assignment, companies on a
licence will have an initial 7-day period in which to waive or reserve
their rights to pre-emption; and then, if they have reserved their
rights, a 30-day period in which to decide whether or not actually
to pre-empt. Specimen Download |
All content © 2004 Leading Oil & Gas Industry Competitiveness