Transboundary Hydrocarbon Resources: Political and Legal Mechanisms for Preventing International Conflicts

Abstract

Since hydrocarbon resources found close to the delimitation line between two or more states require special regulation due to its complex and sensitive nature, the states involved have to consider national legislation and applicable international instruments relating to transboundary exploitation, as well as interests of their oil and gas companies. However, when one state unilaterally explores or exploits the deposit from its side of the delimitation line, it ipso facto violates the rights of the other state, thus leading to a potential international conflict, that would take years to settle. The previously practiced method of seizing such deposits on the “first come – first take” basis is currently considered fraught with interstate conflicts. Moreover, this approach is, economically irrational and, without any doubt, bears a greater negative impact on the environment, thus making an agreed regime of transboundary subsoil use more viable. Often coastal states reach an agreement on transboundary activities, that calls for intergovernmental consultations to be held once a particularly transboundary deposit is discovered. It is usually followed by conclusion of contract between operating companies, that addresses all the technical issues of exploration and exploitation of specific field. The existing political and legal mechanisms of transboundary subsoil regulation prove to be successful, especially in previously disputed maritime areas. State practice demonstrates the tendency towards universal agreement-based exploration and exploitation of transboundary hydrocarbon resources. Applicable political and legal mechanisms will presumably evolve and differ from one another depending on the individual characteristics of oil and gas fields in question and areas where the deposits are located.