Sunday, April 22, 2012

More Continental Shelf Drilling Deals

Here’s an example of an offshore drilling deal, much like the one that has gotten Chevron in trouble with Brazil, and Argentina rattling sabers at the U.K.

The risks of fines or expropriation are big enough to still make this sort of deal worthwhile. Shell invested a huge amount in developing fields near Sakhalin that were expropriated by Russia (technically, Shell gave up its ownership of fields in Sakhalin just before they were ready to produce, in exchange for rights to a different undeveloped oil field).

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