12. Typical production test contract


As each Production Test is specific, it is not normal for a COMPANY to have a contract in place such as the one briefly described in the next section. The norm is to enter a short-term contract agreement for a specified number of well tests and equipment and services required to support such an agreement.

Table of Content -  Agreement between COMPANY and CONTRACTOR.

Part 1 - Form of Agreement

Contains contract formalities between parties, timing, laws, type of services etc.

Part 2 - Scope of Work

Outlines object, scope of work and/or services to be provided.

Part 3 - Executive plan

Gives mobilisation/demobilisation plans in timetable form, reports on preparatory arrangements, shipping times etc.

Part 4 - Conditions of Contract

Includes definitions, interpretations, commencement, duration, termination, execution of work and/or services, contractor's personnel, materials tools and equipment, standard of performance, prices and payments, taxes and duties, terms of payments, audit rights of the company, liability for equipment, personnel and operations, insurance, working conditions, special circumstances, sub-contracting, assignment of contract, general provisions, etc.

Part 5 - Provisions by Contractor

Covers supply of equipment and personnel.

Part 6 - Provisions by Company

Same as Part 5 but from the Company's point of responsibility.

Part 7 - Specifications and standards

Lists the requirements that Equipment, Production Testing Operations and Safety considerations must conform to.

Part 8 - Drawings

Appended in this section are drawings of requirements of surface layouts, separators, choke manifolds, test tanks, transfer pumps, booms, burners, laboratories, heaters, pup joints and swivels, gas gravitometers, scanners, deadweight testers, recorders, pumps etc. 

Part 9 - Schedule of prices and rates

This section lists financial considerations such as currency, lump sum payments, day rate payments, volume discounts, reimbursable charges, penalty, liquidated damages, rates for additional work etc.

Part 10 - Administrative procedures

Procedure guides relating to call off, communication, variation to work, invoicing, emergency, incident reporting, subcontracting, completion and close out is covered here.

Part 11 - Performance guarantee

This section requires the contractor to unconditionally and irrevocably guarantee to conform to all proceeding chapters.

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