Chapter 3: Methane Hydrates as an Energy Resource

Third chapter from the book "Mechanism Design for the Fiery Ice: Civil liability and regulations for the efficient governance of the environmental hazards from offshore methane hydrate operations." Forthcoming

27 Pages Posted: 14 Jul 2014

See all articles by Roy Andrew Partain

Roy Andrew Partain

School of Law, University of Aberdeen; IUS Commune Research School

Date Written: July 1, 2014

Abstract

This chapter provides a background on the potential commercial and welfare benefits of offshore methane hydrates as related to potential upstream extraction and production activities. The second chapter details the science and engineering of offshore methane hydrates; the fourth chapter covers the potential risks and hazards of their development.

A longer abstract of the book's agenda:

Offshore methane hydrates present a potentially abundant source of energy and fresh water and may open new pathways to green energy. However, there are certain novel harms and hazards present within the circumstances of developing and producing offshore methane hydrates. Both cataclysmic and non-cataclysmic hazards must be integrated into policy planning for the onset of this new energy resource.

The study proceeds in four parts. The first part of the study provides an introduction to the scientific, engineering and commercial characteristics of offshore methane hydrate projects. It also provides reviews of both the potential benefits and the potential hazards of offshore methane hydrates.

The second part of the study provides a review of the law and economics theory of accidental law as applied to environmental accidents. Rules of civil liability are reviewed to determine when strict liability or negligence might be efficiently employed in risk governance. Further, similar reviews are developed for public and private regulation. A scientific review of the circumstances of offshore methane hydrates finds that the optimal set of rules is a combination of a strict liability paradigm in complementary implementation of public regulations.

The third part examines existing laws and conventions to determine which might be applicable to offshore methane hydrates. The study also reviews if their risk governance strategies are in accordance with the recommendations from the second part of the study. It is found that most of the evaluated laws do follow a similar risk governance strategy of strict liability accompanied by public regulation, but that many of the current laws to address offshore oil and gas hazards would not interface with the particular circumstances of methane hydrates.

In the fourth part of the study, a summary of the three previous parts is presented and recommendations are made as how to update the existing legal frameworks to accommodate the onset of offshore methane hydrate development and production.

Keywords: law and economics, tort law, civil liability, regulations, private regulations, methane hydrates, gas hydrates, energy law, accident law, Shavell, Posner, Faure, offshore, energy, natural gas

JEL Classification: K00, K13, k2, K32 , K33, N7, O13, O32, O33, Q20, Q28, Q32, Q38, Q42

Suggested Citation

Partain, Roy Andrew, Chapter 3: Methane Hydrates as an Energy Resource (July 1, 2014). Third chapter from the book "Mechanism Design for the Fiery Ice: Civil liability and regulations for the efficient governance of the environmental hazards from offshore methane hydrate operations." Forthcoming , Available at SSRN: https://ssrn.com/abstract=2465613

Roy Andrew Partain (Contact Author)

School of Law, University of Aberdeen ( email )

Taylor Building
King's College
Aberdeen, Scotland AB24 3UB
United Kingdom

HOME PAGE: http://https://www.abdn.ac.uk/staffnet/profiles/roy.partain/

IUS Commune Research School ( email )

Netherlands

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