Third-Party Access to the Upstream Oil and Gas Infrastructure

Background

The infrastructure in the United Kingdom Continental Shelf (UKCS) is a complex network which has developed over many decades, much of it built to serve the needs of individual fields, but also including a network of trunk lines. Over the years increasing amounts of capacity have become available in pipelines and platform processing facilities. At the same time, in a mature basin such as the UKCS, discovery sizes have fallen, and few fields are now large enough to justify the creation of entirely new infrastructure. Most new developments therefore require access to third-party infrastructure in order to reach the shore. In some cases, access may be required to several different links in an export route. This would seem to present a great opportunity for both owners of new fields and owners of infrastructure. However, it comes with challenges.

First, for many new fields, there will be limited choice as to export route and therefore the normal competitive market process may fail to operate effectively. The infrastructure may even constitute an essential facility for competition law purposes, where failure to allow access on fair and non-discriminatory terms would constitute an abuse of a dominant position (see below Competition issues).

Added to this, for some operators in the UKCS, third party access (TPA) has in the past been viewed, and some would argue still is viewed, as more