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Joint Development of Seabed Resources in Areas of Overlapping Maritime Claims: An Analysis of Precedents in State Practice

Dr Constantinos Yiallourides

Abstract

The known or suspected presence of offshore hydrocarbons not only has prompted coastal states to elaborate expansive claims of maritime jurisdiction but it has also been influential in the efforts of some states to preclude one another from carrying out economic activities, such as oil exploration and exploitation, in the areas of overlapping claims. In the absence of clear and defined boundaries, possible state responses can range from protracted negotiations to unilaterally undertaken activities, verbal protests and even the threat or use of force. However, one must not view offshore natural resources merely as a source of interstate friction but also as an opportunity to establish strategic alliances over economic and security matters. Joint development has proved to be a pragmatic reflection of this opportunity: it enables the peaceful and coordinated economic utilisation of disputed maritime areas while removing, even temporarily, the disruptive element of contested jurisdiction from the disputing states' agendas.

This paper examines the concept of joint development of offshore oil and gas resources. It discusses the key elements that distinguish joint development from other concepts such as cross-border unitization and outlines the reasons that make joint development practically appealing both in terms of promoting interstate cooperation over seabed activities but also in terms of stimulating energy investments in disputed maritime areas. Additionally, the paper discusses the legal foundations of joint development under the United Nations Convention on the Law of the Sea (UNCLOS) and examines whether states are under a legal obligation to enter into joint development agreements, pending the settlement of their maritime boundaries. Finally, the paper considers the different operative models in which joint development schemes can be structured and implemented having regard to successful or unsuccessful precedents in state practice.

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