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This subject considers the legal issues and structure of transactions relating to the exploration, production and marketing of petroleum that, owing to its economic and strategic importance, is the most important commodity traded worldwide. This subject will give students a detailed understanding of how crude oil and gas are exploited and marketed worldwide. It will cover how countries establish sovereignty over petroleum resources and how host governments or their national (state-owned) oil companies contract with private companies to explore and develop oil and gas resources. This subject also reviews and analyses key contracts among petroleum companies, and contracts between petroleum companies and petroleum-services contractors, that facilitate exploration, development and marketing of petroleum. As petroleum is one of the most politically charged commodities, this subject will also consider extra-territorial anti-corruption law and political risk. In a broader sense, this subject will help students develop better analytical skills—especially the ability to critically evaluate contracts.
Principal topics include:
- Host government contracts
- Joint bidding, confidentiality, exploration and farmout agreements
- Joint operating and unitisation agreements
- Managing and contracting to avoid corruption problems
- Managing and allocating risk in service contracts.
Intended learning outcomes
A student who has successfully completed this subject will:
- Have an advanced and integrated understanding of the legal and commercial principles associated with petroleum transactions between host governments and petroleum companies, as well as transactions between petroleum companies and transactions between petroleum companies and various petroleum services companies, including any recent developments in law and commercial practice
- Begin to develop the ability to critically examine, analyse, interpret, and assess petroleum contracts between host governments and petroleum companies, as well as transactions between petroleum companies and transactions between petroleum companies and various petroleum services companies
- Begin to develop the ability to be an engaged participant in negotiating from various vantage points the key provisions in petroleum contracts between host governments and petroleum companies, as well as transactions between petroleum companies and transactions between petroleum companies and various petroleum services companies
- Gain an appreciation of the sophisticated nature of petroleum transactions entered into in the transnational arena
- Understand the relevance and effect of extra-territorial law, such as anti-bribery law, that can adversely affect the legality and success of an investment
- Gain an advanced understanding of the key legal issues that must be considered when contemplating a petroleum investment in a host government
- Gain an advanced understanding of the key legal issues that must be considered when drafting or vetting contracts between host governments and petroleum companies, contracts between petroleum companies, and contracts between petroleum companies and various petroleum services companies
- Gain an understanding of the most important legal provisions in the various contracts mentioned above from the vantage point of each of the parties to a particular contract: the host government, the petroleum investor, the petroleum operator, the petroleum non-operators, petroleum services sector, and the public
- Gain cognitive and technical skills to generate critical and creative ideas relating to the various petroleum transactions, including host government granting instruments, confidentiality agreements, joint study and bid agreements, farmout agreements, joint operating agreements, and petroleum drilling and services contracts
- Gain cognitive and technical skills to independently examine, research, and analyse existing and emerging legal issues relating to the upstream petroleum industry
- Gain better communication skills to clearly articulate and convey complex information regarding petroleum transactions to clients.
Last updated: 3 November 2022