International Commercial Joint Venture: Designing, Reviewing and Negotiating Joint Venture Agreement and all related agreements and documents

Case

You are a legal, management or commercial advisor to a technical company working in the Russian Oil and Gas business. We shall call the company “ROG”.

ROG has experience with working in Russia, especially with onshore oil and gas exploitation, specifically engineering and design, project management, manufacture of exploitation equipment. ROG has recently been given the opportunity, by both Rosneft and Gazprom, to become involved in the extraction of gas, condensate and oil from subsea fields identified in Russian continental water.

ROG has been invited to bid for some Engineering, Procurement, Construction (Fabrication and Manufacturing), Installation contracts for the Bing field offshore Sakhalin Island. The client is Gazprom, who is the Bing field developer and project responsible. The contract involves 8 years’ work, and is worth many million Euros.

Gazprom requires a considerable amount of the Design, Engineering, Procurement and Construction to be performed in Russia, with optimal use of Russian materials and components, and Russian manufacturing facilities.

Because of Russia’s relatively limited experience with subsea exploitation, ROG management has decided that it will be useful for ROG to enter into a joint venture with an international technology company with many decades of EPCI experience worldwide. We shall call this company “Amandla”.

Preliminary meetings have been held between the two potential joint venture partners. A preliminary, high level agreement has been made, in a short agreement between the CEOs of both companies, that a comprehensive joint venture will be negotiated over the following months.

You have been invited to join the team which will advise ROG as to the best way to proceed.

This format allows students to develop multilaterally, gain experience in business and risk analyses including cross border issues, creating documents of different types, including several agreements, negotiating and planning for successful implementation of a joint venture.

On September 23, 2021, within the framework of the international student research project "International Commercial Joint Venture: Designing, Reviewing and Negotiating Joint Venture Agreement and all related agreements and documents", which is being implemented for the first time in 2021/2022 academic year by the School of International Regional Studies of the Faculty of World Economy and International Affairs, National Research University Higher School of Economics under the supervision of the head of the Department, Vera Vishnyakova, Ph.D and a Russian postdoc of School of International Regional Studies Irina Strelnikova, Ph.D in cooperation with managing director Graham Dyson Orion Partners AS, Technical and Mercantile Consulting company, Norway, held a meeting of participants and international partner of the project in a Zoom format. Within the framework of this meeting, the main contours of the project were outlined, the format and structure of the work identified, considered the relevance and specificity of the creation of international joint ventures.

On October 14th, 2021, within the framework of the international student research project "International Commercial Joint Venture: Designing, Reviewing and Negotiating Joint Venture Agreement and all related agreements and documents", another meeting was held in the Zoom format. Within the framework of this meeting, the main kea issues arising in the process of launching projects for international commercial joint ventures were discussed, the list of documents that should be prepared at the stage of negotiations on the creation of a Joint Venture was considered, issues related to the risk management approach used in international joint ventures were discussed, the problems of Due diligence were touched upon, the structure and main characteristics of the Cooperation agreement were considered, which the project participants should prepare in working groups for the next meeting.

On November 12, 2021 the lecture within the framework of the international student project “International Joint Ventures: specifics and features of foundation and functioning” was conducted by Executive Director of Orion Partners AS, Technical and Mercantile Consulting company Graham Dyson. The lecture was in English, the format of the lecture was interactive and represented discussion between the lecturer and students. Besides, the young audience demonstrated Cooperation agreements which were prepared by project participants’ at home. 
The main accent was made on the concept of trust.  Students were asked on what basis they can trust a potential partner according to a joint venture. Many answers were given, we are able to key ones.  A trust on the basis of a previous experience, thoroughness during signing an assignment ( it should not be perceived as ritual), written agreement of a potential partner about disclosure of any information connected with joint venture, a trust on the basis of a permanent dialog.  The second part of seminar was dedicated to the consequences of the information leak and violation of the obligations under NDA and to the ways of solution of this issue. The lecture was devoted to an improvement of both practical and theoretical skills.

On January 26, 2022, the final online conference was held, within the framework of which the project participants, under the guidance of the project leaders of the researcher of the department, Ph.D. I.A. Strelnikova and Graham Dyson, Managing Director of Orion Partners AS, Technical and Mercantile Consulting company, successfully delivered individual presentations of their reports on the results of the project. The presentations of the project participants are available at the link.

Examples of contracts are available here. 

Group 1 

Group 2

Group 3

Group 4

Group 5

Cooperation Agreements of Project Participants are available here.

The presentations of the project participants are available here.