In Article for Chambers & Partners, John LaMaster and Marc Hammerson Discuss Impact of Brexit on UK’s Oil and Gas Sector
Akin Gump partners John LaMaster and Marc Hammerson have written “Brexit and UK Oil & Gas,” an article soon to be published by Chambers & Partners in the Chambers Legal Brexit Guide, 2016, that discusses how the vote by the United Kingdom to leave the European Union may affect the U.K. oil and gas industry.
LaMaster and Hammerson write, it is “impossible at this early stage to reach any definitive conclusions regarding the consequences of Brexit to the UK oil & gas industry,” but there are several issues that will likely be of interest. They include:
- When (if at all) will the U.K. commence the formal withdrawal process from the EU?
- What will be the nature of the new relationship to be negotiated between the U.K. and the EU?
- Will Brexit lead to similar instability in other EU member states?
- Will Brexit lead to a second referendum on Scottish independence?
LaMaster and Hammerson note that, in the long term, “[I]f EU and UK laws begin to diverge in material respects, oil & gas industry participants will have the additional cost and administrative burden of complying with two legal regimes. This could put the UK at a disadvantage in attracting new investment from European oil & gas companies.”
Additionally, they write that restrictions on the free movement of goods “could affect the UK’s imports of gas and of refined oil from the EU, as well as the UK’s exports of oil products to the EU. If these are imposed this would have a significant effect on the UK’s down - and midstream industries – not least because of the UK’s reliance on imported natural gas.”
For further thoughts on this topic from LaMaster and Hammerson, and to read the full article, please click here.