Unsticking the Sticky Clauses Working Group

Purpose

This working group focuses on helping new producers share experiences and increase their knowledge and leverage in challenging issues of petroleum contracting. One central component is creating an annotated library of examples of approaches to tricky contract clauses, complete with discussion of the implications of each approach. A second component takes a broader view, organizing a discussion among new producers of “the petroleum contract of the future” and how it may make sense to adjust dominant contracting paradigms in order to anticipate and respond to evolving conditions.

Outputs

• The group has begun to build the annotated library, populating a detailed list of approaches to stabilization clauses and arbitration provisions, with examples from new producers and established producers alike. The library has served as a discussion-starter among member countries on the pros and cons of various approaches.
• We have also developed a first draft of a concept paper on the “petroleum contract of the future,” written by global expert Pedro van Meurs, which explores how oil producers may adapt their contracting priorities in light of climate change and other evolving market paradigms.

Next steps

• The group will continue to build out the library of clauses, both by populating the library on stabilisation and arbitration with additional examples and discussion drawn from member countries and by tackling additional sticky issues.
• We will convene a discussion of the petroleum contracts of the future in order to deepen the analysis and encourage further thinking across the group on how contracting needs to evolve to serve the long-term interests of citizens.