Suitability and Necessity of Resolving Disputes Relating to Petroleum Exploration and Production and Carbon Storage Investment and Operation through Arbitration in an Era of Energy Transition

Abstract

        Dispute resolution through arbitration under the Petroleum Act B.E. 2514 (1971) is deemed to be a suitable and necessary means to attract investment and operation in the exploration and production industry. The government’s commitment to refrain from unilaterally change rights and benefits of a petroleum concessionaire of a production sharing contractor must be accompanied by a dispute resolution mechanism that is neutral, less politicized, is vested with expertise on petroleum operation. In relation to dispute relating to greenhouse gas storage activities carried out by a petroleum concessionaire of a production sharing contractor under Section 23 of the Petroleum Act B.E. 2514 (1971) should also be resolved by arbitration. This is because arbitration can serve a neutral dispute resolution venue that is conducted by experts. The dispute resolution process can be expedited and is capable of promptly responding to an emergency incident especially in the case of leakage of the stored greenhouse gases. In addition, arbitrators can be required to apply laws and rules that have been developed to reflect emerging and ongoing changes in climate change technologies and associated risks.