Petroleum resources

The treaty on maritime delimitation of 15 September 2010 establishes the maritime boundary between Norway and Russia in the Barents Sea and the Arctic Ocean. The delimitation line unambiguously determines which country has the rights to any petroleum resources that may be found in the previously disputed area.

The treaty on maritime delimitation of 15 September 2010 establishes the maritime boundary  between Norway and Russia in the Barents Sea and the Arctic Ocean. The delimitation line unambiguously determines which country has the rights to any petroleum resources that may be found in the previously disputed area. It also determines which country’s authorities have the right and responsibility to regulate the management of any oil and gas deposits that are discovered. The parties have national jurisdiction on their respective sides of the delimitation line, in accordance with international law.

From the 1980s onward, Norway and Russia agreed not to engage in exploration for or exploitation of petroleum resources in the disputed area. For this reason, there is little knowledge about possible oil and gas deposits in this area. The moratorium on exploration will be lifted when the treaty enters into force. Despite the lack of knowledge about the resource base in the area, the treaty contains detailed provisions on the exploitation of any oil and gas deposits that extend across the delimitation line. These include provisions on the parties’ obligation to enter into cooperation on the exploitation of any such transboundary deposits that are discovered. These detailed provisions are intended to ensure that the deposits are exploited in a cost-effective and rational manner, and that the resources are shared in accordance with the apportionment agreed between the parties.

Neither of the parties can start exploitation of a transboundary deposit without first reaching agreement with the other party. Even if they agree to exploit the field as a unit, an approach known as unitisation, the parties continue to have jurisdiction on their respective sides of the delimitation line. Norway has previously entered into a number of agreements involving unitisation.  An overview of other key agreements on delimitation and unitisation can be found here. Most of these concern petroleum resources in the North Sea. The agreement concluded between Norway and Russia in 2007 on maritime delimitation in the Varangerfjord area also contains provisions on unitisation. The provisions on the exploitation of any transboundary petroleum deposits contained in the treaty on maritime delimitation in the Barents Sea and the Arctic Ocean are modelled on established practice under international law. Read more about agreements involving unitisation here.

The discovery of commercially viable transboundary petroleum deposits could release considerable potential for cooperation with Russia. The treaty on maritime delimitation thus opens new perspectives for the petroleum sector and for Norwegian-Russian cooperation in this sector. The treaty will also pave the way for increased commercial cooperation in the Barents Sea, including exchange of experience and technology. It is essential to ensure that the exploitation of petroleum resources in the Barents Sea is able to coexist with other industries in the area, such as the fisheries. Ensuring high standards of health, safety and the environment will be a key priority.

 

 

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