Ownership of the Oil and Gas Resources in the Caspian Sea - Chapter 4 - Essays on International Arbitration
Kaj Hobér is a Partner of Mannheimer Swartling, resident Stockholm office and Professor of East European Commercial Law at Uppsala University, Uppsala. His practice areas include: international arbitration, East European law, international investment and trade, international business transactions. He has been heavily involved in the legal aspects of doing business in Eastern Europe and the former Soviet Union for the last 20 years. His arbitration experience includes representing both eastern and western European, American and Russian parties as well as parties from developing countries in international arbitrations taking place in Stockholm, Moscow, London, Paris, New York, Vienna and elsewhere. Mr. Hobér has also been involved in numerous oil arbitrations, relating primarily to northern Africa, the Middle East and the former Soviet Union and has acted as arbitrator in more than 150 international arbitrations (including chairmanships) and as counsel in approximately 150 international arbitrations.
Professional memberships include: member of the Swedish Bar Association; member of the American Bar Association; member of the Board of the Swedish Scientific Institute of Arbitration Law, the Board of the Arbitration Institute of the Stockholm Chamber of Commerce, the International Arbitration Club (London) and member of the ICC Institute of International Business and Law (corresponding member). He has been listed as arbitrator on the panels of the Austrian Federal Chamber of Commerce, Vienna, the Chamber of Commerce and Industry of the Russian Federation, Moscow, the Ukrainian Chamber of Commerce, Kiev, the American Arbitration Association and of the ICSID Arbitration Center, Washington DC. He is also a Commissioner at the United Nations Compensation Commission in Geneva.
Originally from Essays on International Arbitration
A large portion of the oil and gas reserves in Central Asia are believed to lie under the Caspian Sea. The extent to which this belief is in fact true remains to be established. For a number of reasons, it is difficult to measure the true wealth of the Caspian Sea. On the one hand, it would seem that the littoral states typically have an interest in exaggerating the potential of the Caspian Sea, primarily with a view to maintaining its attractiveness to outside investment. On the other hand, foreign oil companies interested in the oil and gas resources in the Caspian Sea have a tendency to downplay the potential, presumably in the hope of being able to strike better deals. Even though the Caspian oil reserves cannot match those of Saudi Arabia or other states in the Persian Gulf region, it is clear that Caspian oil has the potential of playing an important role for future worldwide oil supply and thus for oil prices. This is in short the explanation why the question of the ownership of the Caspian oil and gas resources, including the right to license and tax their development is being debated by the Caspian littoral states, i.e. Russia, Kazakhstan, Iran, Azerbaijan and Turkmenistan.
The legal status of the Caspian Sea became a potential issue as the result of the dissolution of the Soviet Union in 1991. Overnight the number of foreign states around the Caspian Sea rose from two – the Soviet Union and Iran – to five. The issue de facto came onto the international agenda in 1994 when the Russian Ministry of Foreign Affairs sent a note to the British Embassy in Moscow saying that the ownership of Caspian resources remained to be settled, a statement made in connection with an investment agreement signed by the Azeri government and a British Petroleum led consortium.
4. Ownership of the Oil and Gas Resources in the Caspian Sea: Problems and Solutions - International Arbitration and Contractual Clauses
4.2 The Legal Status of the Caspian Sea: Sea or Lake -- what difference does it make?
4.3 International arbitration is one possible solution.
4.4 Why arbitration?
4.5 Is arbitration realistic?
4.6 Proposed Arbitration Agreement
4.7 Contractual approaches to reducing the political risk