Energy at sea:Old Problems, New Challenges

Joint development agreements:

seabed exploitation in disputed maritime areas

Vasco Becker-WeinbergFaculty of Law, Universidade NOVA de Lisboa,

PortugalAthens, October 22, 2015

1. Concept and purpose of joint development2. General legal considerations3. Mineral resources clause4. Joint development after maritime

delimitation5. Joint development before maritime

delimitation6. Joint development (and unitization) in

Europe7. Conclusions

Outline:

1. Concept and purpose of joint development

“Never two straws in one glass”(Mouton, The Continental Shelf, RCADI, 1954)

JDA: cooperative efforts between two or more States for the exploration and exploitation of mineral resources that straddle a maritime boundary of are found in areas of overlapping claims …

Concept and purpose ofjoint development

Before and after maritime delimitation and when resources are partly found in the Area (article 142):

a) Activities in the Area shall be conducted with due regard to the of the coastal State concerned

b) Consultations shall be maintained with the coastal State

c) Avoid infringement of rights and interests of the coastal State

d) No exploration of common resources without prior consent of the coastal State

Concept and purpose ofjoint development (cont.)

2. General legal considerations

Power to negotiate and enter into joint development agreements

Legal nature of agreements:a) Before maritime delimitationb) After maritime delimitation

Relevant principles of the law of treaties

Agreements and third States

General legal considerations

Relevance of mineral resources for maritime delimitation: “the essential unity of a deposit” (?)

Relation with States’ submission for the extension of the continental shelf (Mauritius-Seychelles 2012)

The role of private entities: oil and gas sectora) Information on resourcesb) Investment in a high-risk and capital intensive

industryc) Infrastructure and capabilities

General legal considerations (cont.)

3. Mineral resources clause

Outline of State practice regarding:a)maritime delimitation agreements b) joint development agreements

Legal relevance of mineral resources clauses

Is there an obligation to include m.r.c.? Non-compliance with m.r.c.

States’ obligations in the absence of m.r.c.: negotiate in good faith, restraint and share info

Mineral resources clause

4. Joint development after the delimitation of maritime boundaries

Basis for joint development after the delimitation of maritime boundariesa) Resource-efficiencyb) Access to resources that would otherwise be

off-limitsc) Reinforcement of capabilitiesd) Aiding in the delimitation of (partial) maritime

boundaries

States’ obligations

Rights and freedoms of third States

Transboundary hydrocarbon deposits

5. Joint development before the delimitation of maritime boundaries

Provisional arrangements of a practical nature (Articles 74(3) and 83(3) of UNCLOS)

a) States shall make every effort to enter into provisional arrangements of a practical nature and, during this transitional period, not to jeopardize or hamper the reaching of the final agreement

b) Arrangements are without prejudice to the final delimitation

Areas of overlapping claims

Economic activities in disputed maritime areas

The economic relevance of maritime delimitation

Conflicting titles: ‘making your claims known!’

Identification of the joint development area

Areas of overlapping claims (cont.)

Relation with final delimitation of maritime boundaries

Rights and duties of claiming States

Rights and duties of other States

Settlement of disputes (Part XV of UNCLOS)

Identifying the joint development area

Areas of overlapping claims (cont.)

Protection and preservation of the marine environment in disputed maritime areas

Pollution from seabed activities

Obligation to not cause transboundary harm or damage

Areas of overlapping claims (cont.)

Essential legal and functional elements of joint development

State participation in exploration and exploitation activities

Creation of joint entities

Areas of overlapping claims (cont.)

Access to operations

Safeguard of pre-existing rights

Taxation, sharing of costs and revenues

Employment, health and safety

Protection and preservation of the marine environment

Applicable law and settlement of disputes with and between operators

Areas of overlapping claims (cont.)

Classification and exercise of ‘jurisdiction’

Construction and operation

Removal and decommissioning

States’ responsibility for pollution from seabed activities

Maritime security

Oil rigs in disputed maritime areas

6. Joint development (and unitization) in Europe

Czechoslovakia-Austria, 1960 Ems-Dollard Treaty, 1962 The North Sea, (1964/1965) 1971 The Bay of Biscay (Spain-France), 1974 Frigg Field Reservoir (UK-Norway), 1976 Murchison Field Reservoir (UK-Norway), 1979 Statfjord Field Reservoir (UK-Norway), 1979 Framework Agreement (of the above), 2005

Joint development in Europe

Jan Mayen (Iceland-Norway), 1980 Unitization Markham Field Reservoir (UK-

Netherlands), 1992

The Spanish-French-Italian initiative

The eastern Mediterranean

Spain and Portugal in Macaronesia

Joint development in Europe

7. Conclusions

Cooperation is essential for resource-efficiency

Joint development is economically-driven

Consistency of State practice & ‘do we need a model?’

There is no obligation to develop common offshore hydrocarbon deposits

There is no obligation to enter into joint development agreements

Conclusions

Disputes (should) have no impact on compliance with the fundamental principles enshrined in UNCLOS

UNCLOS does not include provisions on disputed maritime areas or territorial disputes regarding islands and other offshore features

UNCLOS provides rules that are applicable when States fail to reach an agreement on the delimitation of maritime boundaries.

Conclusions (cont.)

States’ obligations in the absence of an agreement:

a) Legal consistency and release of claimsb) Due regard and mutual restraintc) Negotiate in good faithd) Cooperate and adoption of substantial

and procedural duties

Managing/governance in disputed maritime areas:- “addressing a multitude of challenges”

Conclusions (cont.)

Vasco Becker-Weinberg

Joint Development of Hydrocarbon Deposits in the Law of the Sea

Springer Verlag (2014)

Obrigado!