A CRITICAL ANALYSIS OF THE OFFSHORE UNITISATION REGIME IN AUSTRALIA

Abstract

Unitisation, and the threat of unitisation, is a major risk for petroleum industry participants because it can significantly affect both project timelines and project profitability. Despite this, the Commonwealth legislative framework is sparse on detail regarding the process for offshore unitisation in Australia. This article examines the offshore unitisation regime in Australia and its implications. Part I describes the historical context for unitisation in Australia; Part II describes the key concepts of unitisation, including both forced unitisation and voluntary unitisation; and Part III reviews the current Commonwealth legislative framework. Part IV analyses the adequacy of the Commonwealth legislative framework in achieving efficiency in unitisation and Part V addresses recommendations for amendments to that framework.