IADC CONTRACTS COMMITTEE MAY 2015

2015 ACTION REPORT Positioning for Growth and Success

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Discussion Topics

IADC CONTRACTS COMMITTEE ACTIVITIES UPDATE

Contracts Committee MISSION 3

Organization 4

Committee Activities 5

2015 Offshore Model Contract Update 7

Close – What we need from You 9

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Contracts Committee Mission

Mission Statement:

To promote clarity and efficiency in commercial documentation

within the global drilling community and foster a wider under-

standing of contracts and risk management.

Model Contracts

Educate re Contracts & Risk Management

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Contracts Committee Leadership

Officer Position Home Company

Stacey Earley Chair Transocean, Director Marketing

Contracts & Proposals

Ernie Nelson Vice Chair, Land Nabors, VP Contracts

Andrew Tietz Vice Chair, Offshore Paragon Drilling, VP Marketing

& Contracts

Ron Potter Vice Chair,

International

Ensco, Ass. General Counsel,

Legal

Dave Faure Vice Chair, Program

Development

Rowan, Ass. General Counsel,

Legal

Mike Dubose IADC Liaison IADC, VP International

Development

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Committee Activities

Conference

Plan IADC Contracts & Risk

Management Conference

Open to All committee members

Once every 2 years

Model Contracts

Update (8) Model Contracts

Open to Drilling Contractor members

~ Every 5 years

Industry Standards

Support Industry Contractual

standards (Papers, presentations, amicus briefs)

Officers, members

Ad hoc

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IADC Committee Chairmen’s Report: Activities

• 2014 Accomplishments

LAND: The Committee published the updated IADC Land Daywork Contract;

OFFSHORE: The Committee decided to move forward on a new model deepwater

offshore international contract;

EDUCATION: The Committee increased participation by holding quarterly meetings

and inviting guest speakers to address topical issues.

• 2015 Goals and Objectives

MODEL CONTRACT: The Committee will continue with the development of a new

model offshore international contract;

CROSS-COMMITTEE: The Committee will seek cross-committee engagement in areas

of mutual interest;

CONTRACTS CONFERENCE OUTSIDE US?: The Committee will seek to expand

international involvement by evaluating interest in international contracts sub-

committees and an international Contracts and Risk Management Conference.

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2015 Offshore Model Contract Update

Objectives of Model Contract and this update

• Scope – International view

• Market – Not to reflect market conditions

• Model – Best represents Drilling Contractors’ issues and interests

• Perspective – Reflect Risk/Reward, Profile/Stake of Drilling Contractors

• Form – Address when to use Contract terms vs. Bridging Documents

• Technical – HSE, SIMOPS issues, see Next Page

• Issues – Reflective of Court Case Outcomes with Significant Impact

– Support for “independent” status

• Vantage Point – IADC Model perspective vs. other Industry Organizations (AIPN,

UK O&G LOGIC/CRINE, etc.)

Schedule

• Target YE2016

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2015 Offshore Model Contract Update

How do we overlap with other committees? Contracts Address Technical Issues:

• Cost of Change in Industry Standards (API 53)

• Maintenance allowance for subsea BOP

• Risks of Rig Moves with BOP deployed subsea

• Surveys required in Accessing the Location

• Liability for Trans-boundary Pollution

• Equipment List: Seeking to work with Technical Committees to Update

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2015 Offshore Model Contract Update

What we need from you: • Technical, Field, International input to Model Contract

• Volunteers to be Advisors on Model Contract Development

•Periodic phone calls

•Review of special topic content

• Contact Stacey Earley (stacey.earley@deepwater.com) or Dave Geer