The Contractual Allocation of Liabilities in the Upstream Oil and Gas Industry Lloyd's Environment and Energy Law Library Series

The upstream oil and gas industry is a high-risk, high-value activity. When operations run smoothly and oil prices are high, immense profits can be achieved. However, when accidents happen the consequences can be catastrophic, as incidents such as Deepwater Horizon and the Piper Alpha disaster attest.

Liability allocation provisions are therefore of vital importance in oil and gas contracts. This comprehensive text addresses the large number of practical challenges stemming from the drafting, interpretation and implementation of such clauses, all in one distinct volume. The author provides an expert account of the industry?s liability allocation regime, explains the reasons behind industry practice, analyses the extent to which the law challenges the industry?s intentions to re-allocate risk in this way, and addresses the technical difficulties inherent in using contracts as a means of re-allocating liability. The book also considers the unique features of offshore contracting, as well as the particular liability allocation issues which can be anticipated to arise as a result of onshore contracting.

This is essential reading for oil and gas lawyers worldwide, particularly those involved in dispute resolution and contract negotiation in the upstream industry. It will also be of interest to those studying and researching energy law.

Part I: Introduction and Context 1.Introduction 2. An outline of the essential features of oil and gas operations 3. Basic norms: the legal background against which the contractual allocation of liability takes place 4. The justification for risk allocation Part II: The Nature and Purpose of the principal clauses involved 5. Indemnification 6. Mutual indemnity and hold harmless clauses 7. Clauses excluding or limiting liability for consequential loss Part III: Complicating factors 8. Public Policy and Contractual Interpretation 9. Statutory Control of Liability Allocation Provisions 10. Privity of Contract and Third-party issues 11. Insurance Part IV: Issues arising in particular contracts 12. State and Industry: The Petroleum Licence 13. Oil Company to Oil Company contracts 14. Drilling Contracts 15. Service sector contracts 16. Particular liability allocation issues in onshore oil and gas operations Part V: Conclusion 17. Conclusion

Greg Gordon is a Senior Lecturer at the University of Aberdeen, and has previously worked as a solicitor at CMS Cameron McKenna, specialising in commercial litigation in the oil and gas sector.