Petroleum Licensing

Innovation Begets Innovation and Concentration: The Case of Upstream Oil & Gas in the North Sea

“…A second key feature of our identification strategy is the comparison of oil & gas fields in UK and Norway, before and after an exogenous Norwegian Supreme Court Decision in 1985 that introduced a substantial difference in the rule of law concerning production licenses in the two countries. To summarize, while the production licenses offered by both countries are very similar (Gordon, 2011), the Norwegian Supreme Court Decision in 1985 established that Norwegian laws limit the ability of the government to retroactively changing certain financial terms of current oil & gas licenses, such as royalty payments. A similar ruling never took place in the UK.…”

“…The UK Government was never bound by similar limitations, as its constitution allows for retroactive changes to contracts in specific domains. Three unilateral changes to existing licenses indeed took place between 1975 and 1987, none of which saw a lawsuit by oil companies (Gordon, 2011).…”

“…For a general discussion of the early history of Norwegian and British regulation seeHanisch and Nerheim (1992) andGordon (2011), respectively. Details of early licensing and the first Norwegian licensing round in 1965 are described inBull (1981).…”

No race for the Arctic? Examination of interconnections between legal regimes for offshore petroleum licensing and level of industry activity

“…The legal nature of petroleum licenses is not definite and regulatory frameworks for awarding petroleum licenses have undergone considerable changes representing shifting priorities of States holding oil and gas resources [28]. While some highlight the elements of the contractual character of licenses, others emphasize their regulatory features [14][15][16]. Indeed, like other activities subject to licensing (eg driving or gun ownership), petroleum exploration and development is potentially hazardous and might interfere with other important maritime activities, such as navigation or fisheries.…”

“…During the 1950s and 60s the first large Arctic oil and gas fields have been discovered in Russia, Alaska, and Canada [9, p [14][15][16]…”