Contracts Relating to Production Platforms, Pipelines and Other Offshore Development Facilities

The purpose of this paper is to explore briefly the principal legal considerations incurred in the drafting, execution and performance of contracts for the construction of offshore petroleum platforms, pipelines and other related development facilities. Not unexpectedly, similar legal implications are generally applicable to all types of offshore facility contracts; therefore, undue discussion of repetitive clauses will be avoided. From a purely legal viewpoint, little difference exists between these contracts, whether related to onshore or offshore operations, except that with offshore contracts vessels are employed under charter, thus interjecting maritime law. However, due to the inherently complex technological hazards coupled with unknown and unforseeable construction problems, the legal implications which flow from offshore contracts tend to be complicated and make drafting hazardous. Unexpected exposure to liability is often associated with offshore contracts. When the international element is injected, more complex legal problems arise in such areas as tax, safety, pollution and labor laws.

Since this author's most intensive and most recent endeavors with offshore contracts have been in the North Sea, this paper will center primarily on and draw from this experience. This is justifiable inasmuch as one may say that the most intensive offshore operations in the