Our Oil and Gas Disputes Survey 2023 has highlighted that regulator activity, environmental issues and global economic and political challenges are seen by those in the oil & gas industry to be driving the industry’s approach to disputes.
The survey results, which can be found here, illustrate the views of over 80 industry global professionals covering most regions of the world and there are various themes emerging from the results.
Project management, joint ventures, disputes with host states and regulators and supply chain activities are the areas identified by respondents as being those where disputes are most likely to arise.
This year’s results show a significant increase in the perception of the risk of disputes arising from actions of host states and regulators, and increased dispute risk profiles for the UK, Europe and South America.
Supply chain activity is now seen as the activity with the greatest risk of disputes arising. This perhaps reflects the facts that suppliers are under increased pressure and there are skills and materials shortages in the manufacturing sector (particularly in renewable energy). Project management, joint ventures and host state and regulator activities are also seen as key risk activities when it comes to disputes arising.
Energy transition activities are also now perceived as giving rise to disputes risk. Perhaps unsurprisingly, the UKCS and Europe are the areas seen as having the greatest risk of disputes from the transition away from oil and gas, including in relation to continued production, decommissioning and consenting. There are several potential causes for this, however perhaps the main factors are the increase in court activity by UK climate campaign groups and the competing demands of continued production alongside energy transition activities, exacerbated by the continuing conflict in Ukraine affecting Europe as a whole.
Decommissioning projects are viewed as at high risk of disputes, alongside hydrocarbon exploration and production. This is perhaps unsurprising, considering that this area of energy law is relatively novel in comparison to the well-established management of fossil fuel exploration and production.
Critically, more than two thirds of respondents believe that these risks can be better managed. Record keeping, close project management and early engagement with counterparties are seen as key tools in mitigating the risk of disputes arising.
Many thanks go out to each of our respondents who participated in the survey. Please do take a look at the summary report attached and contact your usual CMS contact if you would like to discuss further.
Social Media cookies collect information about you sharing information from our website via social media tools, or analytics to understand your browsing between social media tools or our Social Media campaigns and our own websites. We do this to optimise the mix of channels to provide you with our content. Details concerning the tools in use are in our privacy policy.