PRACTICE NOTES
UKCS Third-Party Access to Upstream Oil and Gas Infrastructure: NSTA Guidance, Energy Act 2011 Determinations, ICoP Process and Competition Law
Background
The United Kingdom Continental Shelf (UKCS) comprises a intricate web of infrastructure evolved over many decades, much of it tailored to the requirements of individual fields, alongside a series of trunk lines. Over time, spare capacity has progressively appeared in pipelines and in processing plant on platforms. At the same time, as a mature basin, the UKCS is seeing smaller discoveries, and few fields remain large enough to justify building wholly new infrastructure. As a result, most new projects need to access third-party systems to reach the shore. In some situations, this involves tapping several separate links along an export route. On the surface, this promises a strong opportunity for both new field owners and infrastructure proprietors. Yet difficulties arise. For many new fields, options for export routing are limited, meaning normal competitive market dynamics may not function effectively. In some cases, the infrastructure may amount to an essential facility under competition law, such that denying access on fair, non-discriminatory terms would amount to an abuse of a dominant position (see Competition issues below)...
Energy