Oil and gas notes

25/11/2021

Groups of 7.
Why does production take longer?

2/12/2021
LEGAL AND REGULATORY FRAMEWORK
Land access- dealing with onshore
Within the mining act we have CDAs. That help maintain the community and have their interests
prioritized.

Why is there need for regulation?

● Politics, can cause war
● Environment- who takes responsibility for
Who owns minerals, oil, etc?
The gvt, since the gvt owns natural resources in trust for its ppl

Why doesn't the county gvt of Turkana own the oil?

In terms of revenue or benefits (upstream), is ideally supposed to be a national benefit.
Reflect on whether we've overcome these challenges and how?
Should we wait? Can we learn from other countries? Or will it bring a resource curse/problems?

We'll deal with this in the next class

Production agreements 1
And class groups

9/12/2021

The Norwegian model is based on separation of functions. Different institutions for different
functions.
As Norway found the oil and realized it's benefits, it realized it needed to harness it. The country
took steps to manage resource scarce (how can we retain our economic standing without oil?)
The ten commandments of oil:

1. NCS- Norwegian continental shelf

5. Flaring- burning
What kind of laws do we need to come up with?
How do we negotiate contracts?

Don Hubert- Many ways to lose a billion

Its based on what right is given based on exploiting the good

Check slides on e-learning.

16/12/2021
PSC2

Restricts or limits the powers of the sovereign.

What is the difference between stabilisation clauses and laws applying retrospectively?
Stabilisation clause helps keep things equal for the parties.
Compare the Mauritanian PSC and the Libyan one
M- consent, no effect on us should you change your law

Do freezing stabilization clauses go against permanent state sovereignty?

27/01/2022
JOINT OPERATING AGREEMENTS
Cat 2- 10th Feb- sit in CAT- 1hour- covers, JOA and risk assessment

Download what you can from e-learning today before it's deleted

TAKE THE REVISION CLASS BEFORE THE EXAM SERIOUSLY

- Have questions
JOAs

These are the guiding JOAs, there's no specific one you must follow.
Deep water horizon/ Makondo case- there's a movie about it. Involved one of the biggest oil
spills in history.
 1. Share costs, expertise, profits, risk

Helps know who to hold liable

The operators are insured, if they aren't it is considered willful misconduct.

The operator acts as an agent of the JV.

17/02/2022
LOCAL CONTENT

Why is the middle section more productive for local content?

In terms of monetary benefits, its little in the first two stages.

We must look at what will happen after operations are over.

Local content should not end after the project ends.
Technology transfer- can they join with local companies to share information

What is local? It depends.

Local Content Bill

1. National view
2. Region
3. Community directly affected by the operations
It depends on the purpose of benefits eg jobs (the benefits are in the table above eg training,
research etc)

Petroleum act

What happens if they don't meet those standards or there's no specific skill set? They won't use
Kenyan services.
Won't it go contrary to the act?
● They can train locals to work for them
In reading for exam focus on second part of this class- from form of local content
requirements

Trinidad and Tobagos way of handling local content is considered revolutionary.

Why it's a challenge, counterargument,

Look at the Trinidad and Tobago legal framework and how they came into being good at
local content

Read handbook for trinidad and tobago

24/02/2022
RISK ALLOCATION;

She will only examine things that are taught. Next week will be a revision class.
What is being frozen?
What equilibrium is being restored? Eg bringing the IOC back to its position before any damage
occurred.
CONSEQUENTIAL LOSS
3/03/2022
Last two units that we haven't learnt won't be examined
There's
● situational questions
● Direct questions- define, analyse this
Get to the point, no need to give a lot of background info
Cite case law
Read the question many times/ carefully
Show your level of understanding of the topic
Structure
Justify your answer, argue it out, don't just put one statement

JOA, legal and regulatory framework, local content, pscs, risk allocation…
There's basically a question on everything

Read PSCs and JOAs, the elements of both, different clauses and application, purpose,
rationale. If they're not there, what does it mean
Be very clear, don't be too verbose, get to the point fast then explain the point

Be careful with terminologies- sole risk, non consent, freezing, equilibrium, indemnity clause.
What are they? What do they do?

Read further on the topics

Be particularly careful with the terms you use

Local content, risk allocation- read with the slides.

Q1 has a,b,c sections