Presentation for THE LEGAL PROVISIONS ABOUT THE EXPLORATION OF HYDROCARBONS IN AN EXCLUSIVE ECONOMIC ZONE Course:Oil and Gas Law MSc Oil and Gas Technology Eastern Macedonia and Thrace Institute of Technology School of Engineeringms, http://msc.petrotech.teikav.edu.gr/

1. Oil and Gas Law 08/12/2014
MSc Oil and Gas Technology
Eastern Macedonia and Thrace Institute of
Technology
School of Engineering Technology

2. Continental shelf
• The boundary of a continent is not its coastline, but the edge
of the continental shelf that lies under the ocean. Even
though it is underwater, continental shelf is part of the
continent and contains the sea-bed and subsoil of the
submarine areas that extend beyond the territorial sea.
Coastal nations have control of all resources on or under it,
living or not, but no control over any living organisms above
the shelf that are beyond its exclusive economic zone.

3. Exclusive economic zone
• An exclusive economic zone (EEZ) is a sea-zone prescribed by the
United Nations Convention on the Law of the Sea (UNCLOS), over
which a coastal state has sovereign rights to explore and exploit,
conserve and manage its natural resources. It stretches from the
seaward edge of the state's territorial sea out to 200 nautical miles
(nm). When two (or more) state’s coastal baselines are less than 400
nm apart, overlap of EEZs occurs and it is up to the states to delineate
the actual maritime boundary.
• Territorial waters or territorial sea, as defined by the UNCLOS of 1982
(Art 3), is a belt of coastal waters extending at most 12 nm from the
baseline of a coastal state. The territorial sea is regarded as the
sovereign territory of the state.

4. Rights of the coastal State over
the continental shelf
• The coastal State exercises over the continental shelf sovereign rights for the
purpose of exploring it and exploiting its natural resources.
• The rights referred to in paragraph 1 are exclusive in the sense that if the coastal
State does not explore the continental shelf or exploit its natural resources, no
one may undertake these activities without the express consent of the coastal
State.
• The rights of the coastal State over the continental shelf do not depend on
occupation, effective or notional, or on any express proclamation.
• The natural resources referred to in this Part consist of the mineral and other
non-living resources of the seabed and subsoil together with living organisms
belonging to sedentary species, that is to say, organisms which, at the harvestable
stage, either are immobile on or under the seabed or are unable to move except
in constant physical contact with the seabed or the subsoil.

5. Article 87-Freedom of the high
seas
• The high seas are open to all States, whether coastal or land-locked. Freedom of the high seas is
exercised under the conditions laid down by this Convention and by other rules of international
law. It comprises, inter alia, both for coastal and land-locked States:
1. freedom of navigation
2. freedom of overflight
3. freedom to lay submarine cables and pipelines,
4. freedom to construct artificial islands and other installations permitted under international
law,
5. freedom of fishing
6. freedom of scientific research
• These freedoms shall be exercised by all States with due regard for the interests of other States in
their exercise of the freedom of the high seas, and also with due regard for the rights under this
Convention with respect to activities in the Area.

6. Rights, jurisdiction and duties of the
coastal State in the exclusive economic
zone
In the exclusive economic zone, the coastal State has jurisdiction :
• the exploration, utilization and management of all natural resources,
the waters, the sea bed and the soil underneath the sea bed
• the production of energy
• the utilization of manmade islands, installations and structures
• scientific research
• the protection of the environment and
• all rights and duties provided by the UN Convention.

9. Sea Around Us Project
• The Sea Around Us Project (SAUP) is an international research group
based at the University of British Columbia Fisheries Centre that is
devoted to studying the impacts of fisheries on the world's marine
ecosystems. To achieve this, project staff have used a Geographic
Information System (GIS) to map global fisheries catches from 1950 to
the present, under explicit consideration of coral reefs, seamounts,
estuaries and other critical habitats of fish, marine invertebrates,
marine mammals and other components of marine biodiversity.

13. Exploitation of Offshore Trans
boundary Oil and Gas Reservoirs
The United Nations Convention on the Law of the Sea (UNCLOS) provides a legal framework for
maritime boundary delimitation and the exploitation of hydrocarbons in the contained areas.
BUT
What happens when the hydrocarbons reservoirs are located in between the boundary limits of two
or more neighbouring states?
According to the international law exploitation of shared resources in disputed maritime areas is
prohibited without the cooperation from all the states.
Even if a state has not signed to UNCLOS the same obligation exists under International Customary
Law

14. There are two cases of transboundary Oil ans Gas reserves
• A) The boundaries between the neighbouring countries are established
• Exploitation of hydrocarbons is defined in Cross Border Unitization Agreements
B) Deposits are found in a disputed territory
• Exploitation of hydrocarbons is defined in Joint Development Agreements (JDAs)
Both serve the same purpose, which is the agreement on the standards of the cooperation
between the neighbouring countries.

15. The first question that comes up is:
• Who will guarantee the cooperation of the exploitation and development of the shared
reserves?
• A unit operator for the reserves is appointed by agreement between the licensees of the
two governments
It is as if the separate leases and licenses are merged into one single lease or license,
with a single supervisor appointed to manage the development of the field
The free movement of persons and material, safety, inspections and other matters are
also regulated in the JDA

16.  The second question is:
• Which are the financial provisions? Do all states have the same financial rights on the reserves?
• Sharing of production and cost is usually agreed on a pre-negotiated formula and not on any
geomorphologic basis
 Equal sharing is the most common practiced measure
 Variations do exist:
 Timor Sea Treaty provides that upstream taxation of revenue from the JDZ is to be split between
Australia Timor-Leste on a 90/10 basis
 Under the Nigeria STP Treaty, Nigeria shares 60% of the resources and 40% goes to Sao Tome and
Principe

17. What if there is after all a disagreement between the states involved?
• In most cases JDAs provide for an informal dispute resolution mechanism between parties
 In other words the states usually agree on a arbitral committee to resolve their disputes
For example: Australia –Timor Leste treaty provides for dispute resolution by the Council of
Ministers and if unresolved, to be resolved by an arbitral commitee of three arbitrators
appointed by the states
If the dispute is still not resolved the states may therefore resort to thirds parties for expert
advise

18. According to the CIA The World Fact
book
Albania:
• territorial sea: 12 nm
• continental shelf: 200 m depth or to the depth of exploitation
Italy:
• territorial sea: 12 nm
• continental shelf: 200 m depth or to the depth of exploitation
Libya:
• territorial sea: 12 nm
• note: Gulf of Sidra closing line - 32 degrees, 30 minutes north
• exclusive fishing zone: 62 nm

19. Cyprus:
• territorial sea: 12 nm
• contiguous zone: 24 nm
• continental shelf: 200 m depth or to the depth of exploitation
Egypt:
• territorial sea: 12 nm
• contiguous zone: 24 nm
• exclusive economic zone: 200 nm
• continental shelf: 200 m depth or to the depth of exploitation
Turkey:
• territorial sea: 6 nm in the Aegean Sea; 12 nm in Black Sea and in
Mediterranean Sea
• exclusive economic zone: in Black Sea only: to the maritime boundary
agreed upon with the former USSR

20. Greece
• territorial sea: 12 nm
• continental shelf: 200 m depth or to the depth of
exploitation

24. Why a State to declare Exclusive
Economic Zone?
• Production of Wind Energy
• Offshore Installations
• Scientific Research, such as seismic data for the detection of the
hydrocarbons and methane hydrate deposits
• Fishing Industry
• LNG Structure of Alexandoupoli
• Protection of Marine Habitats and Ecosystem- Tourism Industry
• Protection of the Enviroment