Disputes in Energy Projects

By Tim Martin

The international energy business invests in large, complex, capital-intensive projects that have long life spans. Circumstances, economics, governments and parties invariably change in these international projects, which can often lead to a dispute. The energy sector is also a major global investor. The result is that the international energy sector, along with its associated construction projects, makes up the largest portfolio of international commercial and state investment disputes in the world:

Disputes are therefore a significant risk in any international energy project. The risk is not whether a project will have a dispute, but rather in how well a company can manage that dispute to get a satisfactory result. Energy companies therefore need to continually manage that risk from the inception of the deal through to the point when a dispute arises and is eventually resolved.