International oil and gas E&P companies are being exposed to a steady proliferation of policies, laws, guidelines and other standards applicable to their activities. These are accompanied by expanded potential for legal and other liability. There are a number of treaties and other international agreements potentially relevant to E&P activities. National laws are the primary source of environmental law of concern to companies. However, guidelines developed by international governmental, financing, industry and other organizations are establishing standards to which companies may be held legally accountable. A number of key environmental issues and trends are influencing the development of environmental laws and generating areas of legal exposure for companies. Many basic company activities which involve lawyers are potentially affected. Companies can and should undertake a variety of activities to manage the environmental legal risks they flee. Lawyers and negotiators for companies will play an essential role in developing and implementing such risk management programs.


International oil and gas companies are encountering increasing demands worldwide for continued improvement in their environmental performance. They are also being exposed to a steady proliferation of policies, laws, guidelines and other standards applicable to their activities. These are accompanied by expanded potential for legal, and associated financial, public affairs and other liabilities. All of this is occurring in an era of intensifying industry competition and cost pressure for both international companies and their national government partners. These trends are likely to continue.

This paper is intended to provide information that will help international oil and gas exploration and production (E&P) companies manage some of the environmental legal risks they flee. It addresses four major topics:

  1. What should companies know about international environmental law?

  2. What are some key issues and trends companies should anticipate will influence development of laws and create legal risks for companies?

  3. What company legal activities will most likely be affected by those issues and trends?

  4. What can companies do to try to manage relevant environmental legal risks?

What Should Companies know About Environmental Law?

The basic legal framework within which international oil and gas E&P companies operate consists of international, national, regional/state and local laws. In some countries, environmental requirements will be found at all these levels.

In addition to such "hard" law, there is a rapidly evolving body of what may be considered "soft" international environmental law. This consists of non-binding instruments, such as international conference declarations, and guidelines from government, industry and other organizations, that have the potential to evolve into legal standards.

All of these "standards" can generate issues regarding conformance by oil and gas E&P company operations. They can, in turn, give rise to potential legal exposure for companies conducting those operations.

Key Treaties and Conventions. Treaties, conventions, protocols and other international governmental legal agreements may establish mandates for national governments to regulate specific industrial activities. P. 105

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