International Oil and Gas Law Coursework Example | Topics and Well Written Essays - 4000 words

International Oil and Gas Law - Coursework Example German army endeavoured to take control of oil fields around the world during the Second World War. In 1941, the German tried to gain control of the Russian oilfield situated in the Volga region and also later directed its war forces towards the Middle East as abundant deposits of oils was found out in Kuwait and Saudi Arabia. Hence, petroleum has become a strategic commodity for the nations around the world now. Oil is a strategic commodity which is likely to uphold its vital role in the near future also as it is extensively used in transport, generating electricity, etc. It is estimated that the demand for the petroleum is likely to soar up in the coming years to reach a level in excess of 4 Gt/y1. The development and exploration of Oil & Gas involves both high return and risk. The development of petroleum reserves needs the allocation of expertise and massive investments and capital which involves high risk. There can be significant return if the exploration and production of petr oleum resources turned to be successful. Due to this double-edged sword nature of petroleum exploration industry, a number of business contracts and arrangements’ namely fiscal regimes that are never employed in other industries are being used in O&G industries2. The expertise of major oil companies around the world has contained the functions like production, refinery, transportation and sales or marketing. The oil exploration needs the adoption of modern contracts, which are footed upon either wholly or partly on participation arrangement instead of the traditional concession contract system. The main objective of this research essay is to advise Jupitus (J) a developing nation, where there is the absence of both environmental and commercial laws as well as the absence of the adequate international banking system for the purpose of identifying its oil resources and to explore the same as the oil is available, mainly in a habitat of indigenous people. Further, for advising t he Jupitus, the factors like absence of oil industry expertise and absence of established legal or banking systems have been taken into consideration. Further, in Jupitus, there are very few commercial or environmental laws. Jupitus is also a relatively poor country and does not have the resources to develop any of the oil reserves itself and hence, it has to depend upon foreign oil companies (FOC) to explore its petroleum reserves. This research essay will advice Jupitus on three fronts namely the forms of contract to be entered by J with the oil exploring companies , the inherent risks associated with the O&G exploration contracts like environmental ,political and commercial risks and ways and means to minimise the same and the need to develop an international banking system and to have international investment agreements so as to attract more foreign direct investments in the field of oil and gas exploration in Jupitus. 2 Answer to Question 1 2.1 Various Types of Arrangements for Development of Oil Reserves in Jupitus Various types of contracts or arrangements for