GETTING VALUE OUT OF NON-OPERATOR AUDITS

Abstract

The conduct of non-operator audits is a fundamental safeguard built into most joint venture agreements. The conduct of such audits should be regarded as a normal part of managing the relationship between the operator and the other parties to the joint venture, and should, where possible, be undertaken by the joint venture participants' own finance staff rather than abdicated to third parties.

The audits should be expedited in a professional manner and cause the operator the least disruption.

The purpose of audits should be to confirm trust in the operator. Accordingly, they should focus on the operator's systems and procedures for ensuring compliance with the JOA.