Foreign Investment Contracts in the Oil & Gas Sector: A Survey of Environmentally Relevant Clauses (original) (raw)

Impediments to enforcement of environmental treaties against oil pollution

2017

Indisputably, at various fora, the hopeless picture of the condition of the global environment vis-a-vis the linkage of environmental degradation with growth and human welfare has been painted. ‘Safe water is increasingly limited, hindering economic activity. Land degradation endangers the lives of millions of people. This is the world today.’ Unfortunately, despite oil’s significance to the world’s economy, pollution arising from it has constituted one of the major sources of the global environments’ degradation. To address the threat posed by oil pollution to the global environment, some international and regional instruments have increasingly emerged. This article examines some of these instruments along with some of the challenges confronting their effectiveness. The article concludes that relevant steps should be taken to address the challenges in order to ensure that the various instruments and treaties are effectively implemented by States to safeguard a healthy global enviro...

Environmental Regulation of Upstream Sector of Oil and Gas Industry.

2012

The extraction of hydrocarbons is an inherently hazardous activity with potential grave risks to the general environment. Environmental woes occur during all the stages of oil and gas cycle but more notable during the upstream stage of operations. The upstream stage involves exploration, appraisals and production. This stage is accompanied by a range of environmental issues like accidental spills and blow out during development stage , operational discharge and atmospheric emissions like gas flaring during production stage. Major incidents like Ecuador rain forest pollution, Piper alpha offshore disaster (1988), gas flaring in Nigeria, Montara accident (2009) and macondo blowout (2010) are but a few examples. The discussion below evaluates different approaches employed by governments to minimise the risk of upstream operations on the environment. The evaluation will also show how these approaches work and criticisms levied and offer an opinion on what the writer considers the best approach. It is the author’s hypothesis that a combination or two or more approaches could be the best option depending on the host country’s legal framework.

Environmental Issues in Mining and Petroleum Contracts

IDS Bulletin, 1991

extensive damage (especially to vegetation). Development activity in either mining or petroleum entails a major industrial construction project; in mining it also commonly entails the stripping, and storage or disposal, of large tonnages of overburden to expose mineable ore. Production operations require disposal (in mining) of waste, tailings and re-agents. Both industries pose significant, but usually avoidable, environmental hazards: well blow-outs, failures of tailings dams or leakages of toxic wastes, for example. These operations are carried on in the knowledge that significant, and costly, environmental protection measures will nearly always be needed, and that one party or another will, explicitly or implicitly, assume the risk of liability for accidents or other sources of unexpected environmental trauma. Fleightened concern about environmental risks coincides with a period of rapid liberalisation in developing countries and former centrally-planned economies. The success of this liberalisation is, in large measure, predicated upon accelerated inflows of direct foreign investment and the loan capital it can marshal. Countries with promising geology for discovery of mineral or hydrocarbon resources are re-emphasising the requirement for private foreign investment in these sectors. Environmental policy issues fall into three distinct categories. First, there are issues concerned with the operational management of mines, oilfields and plant facilities, where the concern will be to prevent or limit environmental damage arising from normal operations. Second, there are issues related to the possibility that there will be an environmental trauma, catastrophe or accident. Here the problems are the degree of assumption of risk by investors and government respectively, the circumstances in which each party will be liable for damage to the environment and the limits of that liability. The issues in this category give rise to difficult questions of law and may involve considering causation -the most elusive topic in English common law.3 Third, there is a special set of problems surrounding the reclamation of land affected by mining when operations cease, and the safe abandonment or removal of plant, equipment or structures that have no further use but constitute a Hart. li. L. A. and Honoré. 1985. Causation ¡n Ike Lain', 2nd edition. Clarendon Press, Oxford.