The latter has an important job to do in addressing forward-looking and strategic issues through long-term budgets and work programmes. Adopted on 1 January 2007, a general agreement on licence governance provides good guidance on the way work and decisions in these partnerships should be pursued. Petoro played a leading role in work on establishing this accord, which has given the licensees (partners) greater influence.
Responsibility for day-to-day operations rests with the operator, who ensures that the decisions taken are implemented.
The relationship between management committee and operator has similarities with that between the board of directors and executive management in a company. However, the partners in a licence do considerably more independent technical and financial work on and assessments of issues under consideration in the management committee than is normally done by a company’s non-executive directors.
Petoro is responsible for the SDFI in a large number of production licences, which collectively represent a third of Norway’s oil and gas reserves. The company’s attention is concentrated on the partnerships which represent the biggest value-creation potential, and where it can exert the greatest influence.