Negotiations


5. Negotiation Tools

In addition to extractives sector development negotiations guidelines, there are institutions which offer on-demand support to governments in the form of model agreements, technical assistance, training or website portals. A list of potential resources is provided below:

5.1 The Extractives Hub

The Extractives Hub contains a range of topic overviews designed to offer an introduction and resource library on many of the aspects that form part of negotiations. The following pages of the Extractives Hub will be relevant (following are links):

  • Exploration, Evaluation and Planning
  • Environmental Management
  • Managing Commodity Lifecycles, Mining
  • Managing Commodity Lifecycles, Petroleum
  • Mineral and Petroleum Economics
  • Mineral Policy
  • Petroleum Policy
  • Local Content
  • Human Rights
  • Petroleum Compliance and Inspection
  • Mineral Compliance and Inspection

In addition, the Extractives Hub offers short-term technical support function for governments, for example it has provided financial modelling expertise to support contract discussions.

5.2 Columbia Center on Sustainable Investment

The Columbia Center on Sustainable Investment (CCSI) has developed a Negotiation Support Portal to support host countries in the planning, negotiation, monitoring, and implementation of complex investment projects by increasing the accessibility and visibility of available tools, resources and technical support mechanisms.

The Negotiation Support Portal includes a roadmap for the various stages of planning and preparing for a large-scale investment, negotiating the main investment terms, and monitoring and managing the implementation of the investment. Each stage of the roadmap links to key tools and resources as well as to the providers of potential support in relation to that stage. The Negotiation Support Portal also includes a list of short courses and professional development courses provided globally to assist government officials and policy makers in the planning, preparation for, negotiation, monitoring, and implementation of large-scale investment projects.

CCSI also provides advisory and capacity building support to governments in the design of legal, regulatory, and fiscal frameworks related to extractive industries.

5.3 The African legal support facility

The African Legal Support Facility (ALSF), a public international institution under the auspices of the African Development Bank (AfDB) Group, provides legal advice and technical assistance to African countries in the negotiation of complex commercial transactions, including extractives sector negotiations. The ALSF also develops capacity building and knowledge management tools. Its assistance is aimed to avoid cases of delay or cancellation of investments due to poor negotiation of the extractive sector contracts. The ALSF supports host countries through the services of competent law firms identified by the ALSF and recruited to act as government counsel during the negotiations. The ALSF has also set up an Africa Mining Legislation Atlas, which contains soft copies of mining laws from various African countries and enables comparison of their terms.

5.4 Connex Support Unit

Created in January 2017,the Connex Support Unit  provides assistance to governments of developing as well as transition countries in negotiating, renegotiating or implementing large-scale, complex investment contracts, initially focusing on the extractive sector. The assistance provided by the Support Unit is independent of any political, commercial, institutional, or religious affiliation. Since successful investment contract negotiations typically require a range of expertise, the experts provided by the Support Unit can include not only lawyers, but also financial and industry experts, business strategy specialists, economists, environmental specialists, community development specialists, geologists, mining engineers, or any other disciplines needed in the context of specific project negotiations. Examples of Connex support can be viewed here.

5.5 International bar association

In the last three decades, there has been a trend away from seeking to negotiate and agree a contract from scratch between the parties to the adoption of standard or model agreements. For example, the International Bar Association (IBA) has developed a Model Mining Agreement, which is a collection of examples from existing mine development agreements and other contract materials. The Model Mining Agreement has at times been criticized for taking concessions pre-dominantly as a model, however it is also the first model agreement to have sustainable development goals at its core. Despite trends towards the use spread of model agreements, negotiations still play a major part in shaping the content of these agreements in drafting.

5.6 Association of International Petroleum Negotiations

The Association of International Petroleum Negotiators (AIPN) produces petroleum model contracts, which can be a useful tool for the initial phase of negotiations and can reduce the negotiation time. There are 19 model contracts available currently, including a model Unitization and Unit Operating Agreement, International Farm-out Agreement, Area of Mutual Interest Agreement, and International Joint Operating Agreement.

5.7 Other support providers

Other institutions that provide support include: