The oil and gas industry is a complex industry. It is not just heavily regulated but also very competitive and challenging. The regulations governing the oil and gas industry aren’t just regulations about corporations and energy, but also the environment, employment, and tax laws.
Having a strong legal team that knows how to deal with these regulation-related issues is essential for all oil and gas companies. It is also a good idea to have proper representation from an attorney or a law firm with experience in the industry if you want to enter this field as a worker or contractor. We spoke to the best attorneys in this industry and discovered top legal advice and tips for oil and gas companies.
Understand the Streams
The entire energy industry has a workflow that can be categorized into three streams. Depending on which stream the company operates in, legal matters must be handled differently. The first stream is known as the upstream. This is where all E&P companies operate; it is the stream that focuses on exploration and production of oil and gas.
The second stream is known as the midstream. This stream focuses more on the processing, storing, transporting, and the overall management of oil and gas. It is a stream with fewer risks than upstream or downstream, but it is still an essential part of the industry.
Lastly, we have the downstream, which focuses more on refinement. What’s important to note is that the regulations vary from stream to stream. Companies must also take into account state laws and not just the federal regulations. Extensive knowledge of the rules is indeed required.
Health and Safety
As with many other industries, the oil and gas industry is also governed by health and safety laws and employment laws. Regulations in these categories are put in place to ensure a safe (or safer) working environment for all employees.
Naturally, certain streams are classified as carrying more risks. In the exploration business, for example, there are more recorded cases of workers’ injury than in other parts of the industry. As a result, we now have top firms such as J. Reyna Law Firm in Texas protecting oil and gas workers and other parts of the industry.
For the companies, the main focus here is prevention. There are procedures and safety policies put in place to minimize risks (and manage them).
Last, but not least, we have the companies’ relationships with external stakeholders, namely local communities, local and federal government, and non-government organizations. The oil and gas industry is closely tied to the environment and environmental protection, which is why environmental risks must be mitigated and handled properly too.
The company’s legal team must understand environmental laws and standards to comply with depending on where the company operates. This challenge is even more complex when you take into account the diverse markets in which oil and gas companies operate.
It is not easy to build a strong legal team in this industry, but the advice we covered in this article will help any oil and gas company get started without a problem. There are many qualified law firms that offer assistance too, making the challenges easier to tackle.