The complex nature of petroleum industry stakeholders’ engagements andcommercial agreements makes them susceptible to varying disputes. Right fromthe stages of exploration, drilling to refining and distribution of petroleumproducts, there are multifaceted contractual dynamics and huge cost implicationsthat could generate potential disputes. This makes it mandatory for parties toenvisage, negotiate and incorporate appropriate dispute resolution mechanisms intheir agreements. Also, the number of parties involved in the oil and gas industry,along with the multi-party complexities of oil and gas exploration and productionactivities and agreements, may increase the potential for disagreement in thecontracts signed between the parties. The paper discusses the nature and causes ofpetroleum disputes. It also reviews decided arbitral awards and judicial authoritiesrelevant to the subject matter. This paper examines current and emerging patternsof dispute resolving the petroleum industry and the different dispute resolutionmechanisms adopted to resolve them. Particularly, the paper examines the historicrole of the conventional litigation approach in oil and gas dispute resolution. It alsounderscores the imperativeness of the innovative contributions of AlternativeDispute Resolution (ADR) options in determining oil and gas disputes faster whilepreserving the overall economic objectives of parties’ contractual agreements. Thepaper employed a qualitative approach using different relevant materials to unraveland explain the nature of Petroleum disputes and mechanisms for resolving them.The paper concludes by making recommendations.
Dominic O. Akabuiro (Wed,) studied this question.