We will focus on the Joint Operating Agreement which is the most common agreement in upstream oil and gas operations. We will look at the history of the AAPL model form operating agreement and some of its weaknesses and some ways of avoiding problems with its use. We will discuss who is the operator, basics of joint operations, duties of the operator, and duties to non-operators. We will also consider joint operations under pooling and unitization, property provisions, e.g. preferential purchase rights, general joint operations provisions, liabilities of the parties, cost overruns, COPAS overhead litigation, loss of lease rights, failure to reassign subleased interests, recent appellant decisions, non-consent issues, insurance and other risk management issues, tax planning for joint operations, joint operations not covered by the typical agreement, marketing production, enforcing the agreement, removing the operator, exhibits to the agreement, and accounting procedures. We will also provide an overview of the widely used “Farmout” and review particular earning requirements and limitations. We compare wellbore, leasehold, multiwall deals and the use of outside acreage, all with a concern for after tax economic results. You will negotiate various farmout agreements involving different deal terms.