Dispute Resolution in Petroleum Contracts

Abstract

Premeditated handling of settling disputes is one of the main issues that international parties have to take into consideration in concluding contracts. Having effective dispute resolution provisions is one of the key factors that will lead to success in international agreements. In the recent years, the Kurdistan Region of Iraq has made lots of transactions in petroleum industry by concluding many international agreements with various international companies in the energy sector. Negotiation, mediation and arbitration have been adopted by the Kurdistan Regional Government in details, through its Oil and Gas Law No.28 of 2007 and signed production sharing contracts, as means of dispute resolution. Nonetheless, having less experience in this field has weakened the position of the host government in front of foreign companies. Moreover, the recent case of Dana Gas versus Kurdistan Regional Government has proven this fact; it was an indication that the Kurdistan Region has to be more cautious when it comes to regulate the terms and conditions of the contracts with the international companies, particularly in dispute resolution part. This paper will shed light on the available mechanisms to resolve every kind of disputes between the conflicted parties, with the specific focus on Kurdistan Region. Investigating the effectiveness and enforceability of alternative dispute resolution mechanisms is another major part of this paper.