From the Editor - March 2020
Anca Maria Mihailescu
Publications Officer; IBA Oil and Gas Law Committee
Welcome to the latest IBA Oil and Gas Law Committee newsletter.
In the current global context, caused by the spread of SARS-CoV2 coronavirus, the oil and gas sector is facing a massive challenge, the scale of which is still to be seen. The coronavirus pandemic, and the drastic measures taken worldwide to counter the spread of coronavirus infections, has strongly affected oil demand demonstrated by a price war between Riyadh and Moscow and the price of oil barrels dropping significantly.
The virus outbreak could delay the delivery of some oil platforms and other equipment due to shortages of staff or supplies, as well as travel bans imposed by certain countries.This could result in the decline of global exploration and production investments.
Another challenge that the oil and industry is facing is the European Green Deal (the 'Green Deal'). The Green Deal, proposed by the European Commission, is a set of policy initiatives brought forward by the European Commission, which have the overarching aim of achieving climate neutrality by 2050 in Europe. It says the scheme is a road map for making the European Unions’s economy sustainable, by 'turning climate and environmental challenges into opportunities across all policy areas and making the transition just and inclusive for all'. In this regard, the oil and gas industry will play a crucial role in the EU’s transition to cleaner energy.
The goals of the Committee remain unchanged: to focus on the most relevant issues affecting the oil and gas sector, and lawyers working in it, by means of committee updates and through attending various IBA events. This newsletter aims to provide a platform for discussions.
We received some excellent articles and would like to thank all contributors for taking the time to write on such interesting and thought-provoking topics. That’s why we’re thrilled to be presenting a range of topics, as follows:
• an analysis of the main legal issues facing the oil and gas industry in Kazakhstan, with conclusions detailing how it is possible to achieve comfort and positive law enforcement for investors, and where legislation still needs to be significantly improved;
• an overview of the royalties that upstream companies operating in the deep offshore of Nigeria waters are now required to pay, particularly upstream companies who operate above 1000 meters water depth;
• the alternatives to reinvent oil and gas business and ensure their future when fossil fuels become less important as an energy source by finding synergies, integrating renewable energy with their developments and resorting to other effective solutions that are likely to enable achievement of energy transition goals; and
• an analysis of Brazil’s request to United Nations commission to extend their jurisdiction by 350nm, and their decision to include oil and gas exploration and production areas beyond the 200nm limit in the next bid round.
We thank you for taking the time to read this issue and for your continuing interest in the Oil and Gas Law Committee.
Anca Maria Mihailescu