Oil price down, defaults up part 2 - The non-defaulting parties’ perspective

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Summary: The non-defaulting parties’ perspective & the farm-in partner’s perspective

Last week we published the first instalment in our series on upstream joint venture defaults, providing an overview of the key risks and identifying specific risks and options for parties who may find themselves in default.

This week, we change tack and look at the issues and options from the perspectives of non-defaulting parties and potential farm-in partners, focusing on how they can enforce rights and mitigate the significant risks associated with defaulting parties. This includes potential risk mitigation strategies outside of the JOA.

Read the second instalment in the series.

Next week, we will round out the series with key conclusions and a brief overview of the recent UK Supreme Court decision in Cavendish Square Holding v Makdessi. This is a key case relevant to the enforceability of JOA remedies, including the right to require defaulting parties to forfeit their participating interests under the JOA.

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