Governing Legal Principles and Common Features of Upstream Oil and Gas Contracts at the International Level

Karimi, Sahar

doi:10.22034/jrpl.2025.726138

Governing Legal Principles and Common Features of Upstream Oil and Gas Contracts at the International Level

Document Type : Original Article

Author

Sahar Karimi

Assistant Professor, Department of Private Law, Faculty of Law and Political Sciences, Kharazmi University, Tehran, Iran.

10.22034/jrpl.2025.726138

Abstract

Upstream oil and gas contracts are governed by a set of foundational principles whose recognition and application are essential for the development of modern and viable contractual frameworks. Key principles include freedom of contract and party autonomy, freedom of evidence, autonomy in selecting jurisdiction and dispute resolution mechanisms, the principle of pacta sunt servanda (the binding nature of agreements), optimal resource management, and adherence to international best practices in addressing environmental concerns. Despite their varied forms, upstream contracts share common characteristics such as international scope, complexity, divisibility, long-term duration, and a close connection to the host state. A comprehensive approach that incorporates these core principles and shared attributes is crucial throughout the negotiation, implementation, interpretation, and termination phases of such agreements. This approach also aids in assessing the relevance and applicability of different legal doctrines to upstream oil and gas contracts.

Keywords

Oil and Gas Law

Upstream Contracts

Freedom of Contract

Good Oilfield Practices

Natural Resource Ownership

International Trade Law