Membership
Who may become a member of OPOL?
OPOL is structured so that only the operator, or intending operator, under an offshore petroleum licence may be a member of OPOL. In the case of a joint venture, the operator assumes the obligations under OPOL for all other participants. It is the operator’s responsibility, to the extent of any liability it incurs under the OPOL Agreement, to ensure that it has rights of recourse against its co-venturers for their respective interests in the joint venture. This can be managed under the terms of the applicable joint operating agreement.
Click the button to view the flow chart that shows how to become a member of OPOL and remain as a party to the OPOL Agreement.
To become a member of OPOL, you need to submit a Membership Application Form (Form A), followed by the relevant evidence of financial responsibility (FR) as detailed in Form B and as further set out below. Alternatively, if you are not yet an operator but intend to become an operator, a Form C should be submitted rather than an FR form.
In either case, the completed documents should be submitted to admin@opol.org.uk
Providing evidence of financial responsibility
All operators wishing to be members of OPOL must provide evidence of financial responsibility, as detailed in the OPOL Rules, which make all operated offshore facilities in UK waters or, if applicable, in the territorial waters of other Designated States, subject to OPOL. The operator must, in respect of joint ventures, provide evidence of financial responsibility in respect of the total venture (100% interest), irrespective of its interest in that venture.
Why is evidence of financial responsibility necessary?
As well as providing evidence of cover for all offshore facilities, satisfying a party’s obligations under the OPOL Agreement, this is also a protection to claimants evidencing that the party has made adequate provision to meet the obligations assumed under OPOL on a 100% interest basis. It also benefits any non-operating co-venturers to the extent of their interest where they have agreed to contribute to the payment of claims by the operator arising from joint operations.
How is evidence of financial responsibility provided?
The operator may arrange to use any one or a combination of the following methods:
1) Insurance
The insurance cover must be for an amount of not less than US $250 million for any one incident and US $500 million in the aggregate per year (subject to any reduction permitted by OPOL to take account of any additional evidence of financial responsibility provided to the satisfaction of OPOL). A maximum policy deductible of US $10 million in respect of any one occurrence is permitted. Insurers are required to satisfy the minimum credit or financial strength rating as set out under the OPOL Rules.
Evidence of valid insurance is provided to OPOL by using either form FR-1 (the Insurer verified FR form) or FR-2 (The insurance broker verified FR form), whichever is applicable.
If a member is insured under insurance policies arranged by a parent or affiliated company on a group basis then evidence of valid insurance is provided by using form FR-1G or FR-2G, whichever is applicable.
2) Insurance arranged via an Insurance Broker or Agent
If your insurance is placed with insurers by an insurance broker or agent, then you should use form FR-2, which is signed by your insurance broker or agent to evidence and confirm that coverage is compliant with the OPOL Rules and the period for which the insurance remains in place.
If a member is insured under insurance policies arranged by a parent or affiliated company on a group basis then evidence of valid insurance is provided by using form FR-2G.
3) Guarantee from a Guarantor
Use form FR-3 if you are acting as a non-affiliated Guarantor, granting a Guarantee in favour of an operator to evidence its financial responsibility. Form FR-3 includes a schedule setting out the required form of Guarantee.
If the Guarantee is provided by a parent or affiliated company on a group basis, Form FR-3G should be used.
4) Self-insurance
Use Form FR-4 (Verification of Self-insurance) if you are evidencing financial responsibility through self-insurance. The ability to evidence financial responsibility through self-insurance is subject to the verifying operator having a credit or financial strength rating at a level set out in the OPOL Rules.
What does it take to remain a member of OPOL?
Evidence of financial responsibility must be maintained throughout the period that operations are taking place. If the financial responsibility is limited in time, is terminated or is materially altered for any reason, and operations are still continuing beyond such termination, material alteration or expiry date, OPOL must be advised and further evidence provided demonstrating the continuation of financial responsibility. OPOL will monitor the expiry of member’s evidence of financial responsibility annually or at such greater frequency as it deems necessary. If operations will not be continuing, the operator should certify, no later than the date of expiry of financial responsibility, that it will cease to be an operator in compliance with the Continuous Certification Programme.
Annual subscription
An annual subscription is payable by all parties based on the number of members at the beginning of each calendar year and the total budgeted costs of OPOL for that year. All members as at the start of a calendar year pay the same annual subscription. OPOL issues an annual invoice in December of each year for the following year.
When may a party withdraw from OPOL?
A party can withdraw from OPOL by giving not less than 3 months’ written notice. If such notice is received by OPOL later than 30 September in any calendar year then that party will remain liable to pay the full annual subscription for the following calendar year.
If a party wishes to terminate its OPOL membership, a Notice of Termination should be submitted to admin@opol.org.uk.
Membership after cessation of operations
If a member has ceased petroleum exploration and production operations but wishes to retain its OPOL membership it must complete and submit a Form D.
Key Documents
Submitting Forms
Please submit forms to admin@opol.org.uk