Operational Interdependence: The Local Office and Initial Exploration Work Program1
W.F. (Rick) Bott, Jr., 2000. "Operational Interdependence: The Local Office and Initial Exploration Work Program", International Oil and Gas Ventures: A Business Perspective, George E. Kronman, Don B. Felio, Thomas E. O’Connor, Mindy S. Kronman
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The tangible goal of any initial exploration program is to cost-effectively discover a profitable development opportunity and to position the company to maximize the recovery of costs and subsequent profits. The quality of the relationship that is established with the government is one of the most important intangible requirements for entry into a country that will impact the economics of a successful venture. Interdependence is a chosen attitude towards this business relationship that goes beyond “governmental relations” and recognizes that the contractor and government have accepted each other as partners to achieve more than could be achieved separately Each partner’s contribution is different but equal. As with any business relationship, the degree of success depends entirely upon the level of trust that can be established. The contractor who focuses on the relationship will engender trust by being trustworthy and communicative, which will greatly increase the profitability of the venture, as well as create new business and growth opportunities.
The contractor must also fulfill its long-term role as a good corporate partner and environmental steward in the local community to ensure lasting success. The decisions a contractor makes in the establishment of the local office, involvement of the government representatives, and execution of the work program indicate whether the relationship with the host government is viewed as a necessary evil or as an opportunity to forge a competitive advantage. Through this relationship, the contractor has the opportunity to become the operator and partner of choice in the chosen country.
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A “one-stop” business view on how to succeed in international exploration and production. Success in the international upstream arena requires more than the technical ability to find oil and gas. Relationships with governments and people, mutually beneficial contracts, workable strategies, and implementation plans are necessary to build strong, mutually beneficial, and profitable ventures. Key components that drive exploration and production in the global environment are examined. Specific topics include negotiating for success, contracts, the role of technology in international strategies, cross-cultural relationships, alliances, and international upstream financing. Authors from around the world, representing industry, governments, national oil companies, consultants, and academia, contributed their perspectives. Views are provided from both sides of the negotiating table, the corporate boardroom, the resident manager, the explorationist, the businessman, and the theoretician. Geoscientists, engineers, and negotiators, who are, or would like to be, involved in the global energy business will find this collection an important reference.