Selecting Arbitrators for Commercial Oil & Gas Industry Arbitrations - Chapter 23 - Leading Practitioners’ Guide to International Oil & Gas Arbitration

Author(s):

Michael McIlwrath

Page Count:

20 pages

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Published:

August, 2015

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From wellhead to consumer, the world’s oil and gas industry is

built upon a physical infrastructure that, with the depletion of easily

accessible reserves, is ever more dependent on the development and

implementation of new technologies. Taken as a whole, the amount

of technology that keeps the industry vibrant is mindboggling. It can

be expressed in trillions of dollars of installed equipment1 and

hundreds of billions of dollars in capital expenditures that only

increase each year to maintain and develop these assets.2

The breadth of equipment employed by oil and gas producers,

transporters, refiners, and distributers is also vast. It includes drills

that provide real-time information about the rock formations they are

piercing, turbines powering offshore platforms that use the same

engines that power 747 aircraft, fully submerged deep sea installations

that reduce the risks and costs associated with platforms, intelligent

pigs that prevent pipelines from rupturing, and “green refineries” that

convert tar wastes into electricity for domestic use.3 And, of course,

equipment of any type requires support industries to install and

maintain it.

While the above may be apparent to professionals in the oil and

gas industry, it is a necessary premise to discussing the selection of

arbitrators for international commercial oil and gas disputes. In

international arbitration practice it is both customary and expected

that all members of a tribunal will be neutral,4 competent in the

subject matter in dispute, and skilled at managing proceedings

between parties from different legal and cultural backgrounds. Yet as

much as disputes arising under international contracts for the

installation, performance, or maintenance of oil and gas equipment

will require arbitrators who epitomize these universal characteristics,

they often pivot more on differences in their “soft skills,” especially the

procedures they prefer and their philosophy for the determination of
factual issues.