An International Convention on Offshore Hydrocarbon Leaks?

• Author: The Hon. Justice Steven Rares
• Position: A judge of the Federal Court of Australia and an additional judge of the Supreme Court of the Australian Capital Territory. The author acknowledges the assistance of his associates, Andrew Low and Hannah Bellwood, Prof Nick Gaskell of the University of Queensland (who commented on a draft) and Assoc Prof Robin Warner of the University of ...
• Pages: 10-23

(2012) 26 A&NZ Mar LJ

AN INTERNATIONAL CONVENTION ON OFF-SHORE

HYDROCARBON LEAKS?

Ho n Justic e Ste ve n Ra re s*

Introduction

As the world’s known resources of hydrocarbons are diminishing, there has been an increase in the search for and

attempted recovery of oil and gas from off-shore wells. Some estimates suggest that there are over 1 500 off-shore

oil and gas installations worldwide.1

I should emphasise that the views I express in this paper are my own, alone, as

a person with personal and professional interests in the marine environment and in Admiralty and maritime law.

My interest in the topic of this paper was stimulated in two ways. The first arose from work over the last two years

involving judges of the Supreme People’s Court of the People’s Republic of China and the Federal Court of

Australia. This involved us co-operatively considering the operation of various international conventions that dealt

with oil pollution from ships. Coincidentally, as we were working on this in Guangzhou in April 2010, the bulk

carrier, Shen Neng 1 grounded on the Great Barrier Reef discharging bunker oil. Earlier this year the Supreme

People’s Court published a judicial interpretation that provides authoritative directions to all courts in the People’s

Republic of China in respect of claims for compensation for marine oil pollution damage that have no international

elements.2

My second stimulus for this paper was as an observer of the unfolding of events following two recent catastrophes.

These were two major spills from off-shore wells that occurred, one off the North-West shelf of Western Australia

from the Montara platform, the other off the Gulf of Mexico from the Deepwater Horizon rig. The Montara rig

leaked in 2009 for 74 days. It was located in waters about 77 metres deep and drilling at a vertical depth of over 2

500 metres in the Timor Sea about 250 km off the north-west coast of Australia, south-east of Timor-Leste (East

Timor) and east of Indonesia. The Deepwater Horizon leak in 2010 lasted for 87 days. It was drilling in water of a

depth of about 1 500 metres and at a drill depth of about 2 700 metres below the ocean surface, 66 km off the coast

of Louisiana. Both leaks occurred because of blowouts.

Pollution from those spills affected the waters and coastlines of both the States that authorised the drilling as well as

those of neighbouring States. The costs of cleaning up each spill were considerable. And, particularly in the

Deepwater Horizon case, many persons, such as fishermen and those with businesses in littoral towns, claimed to

have suffered economic loss.

In the United States of America there was an outcry when it was suggested that BP, the multinational oil company,

one of the joint venturers operating the Deepwater Horizon rig, might seek to limit its liability under US law for

compensating those who had suffered loss, including government agencies. This highlighted the absence of any

internationally agreed regime to deal with such spills.

* A judge of the Federal Court of Australia and an additional judge of the Supreme Court of the Australian Capital Territory. The author

acknowledges the assistance of his associates, Andrew Low and Hannah Bellwood, Prof Nick Gaskell of the University of Queensland (who

commented on a draft) and Assoc Prof Robin Warner of the University of Wollongong in the preparation of earlier drafts of this paper. The

errors are the author’s alone.

This paper was pr esented at the 2011 Fall Meeting of The M aritime Law Associations of the United States, Canada and Australia & New Zealan d

in Hawaii on 2-5 December 2011. An earlier version of this paper was presented at the International Conference on Liability and Compensation

Regime for Transboundary Oil Damage resulting from Offshore Exporation and Exploitation Activities, hosted by the Government of the

Republic of Indonesia in Bali on 21-23 September 2011. The author is grateful for a number of suggestions and a deal of information provided

by Prof Gunther Handl, Eberhard Deutsch Professor of Public Law of Tulane University School of Law. Another earlier version of this paper

was presented at the 2011 Biennial Mini Conference of the Maritime Law Association of Australia and New Zealand (NSW Branch); Lilianfels,

Katoomba on 11 March 2011 and is published at [2011] LMCLQ 361.

1 Joint Group of Experts on the Scientific Aspect s of Marine Environmental Protection, ‘A Sea of Troubles’ (Research Discu ssion Paper,

GESAMP, 15 January 2001).

2 Provisions on Several Issues Concerning the Hearing of Cases Involving Marine Oil Pollution Damage Compensation Disputes: adopted by the

Judicial Committee of the Supreme People’s Cou rt of the Republic of China in its 1509th meeting on 10 January 2011.

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