1. DISPUTE RESOLUTION in the OIL & GAS INDUSTRY : NON-MEDIATION ADR a presentation by HEW R. DUNDAS Chartered Arbitrator DipICArb CEDR-Accredited Mediator www.dundasarbitrator.com

2. OVERVIEW of PRESENTATION  Introduction  Dispute Resolution Options  International Disputes  Oil & Gas Industry  A Case Study  Conclusions

3. DISPUTE RESOLUTION OPTIONS  Litigation  Arbitration - Domestic/International  Expert Determination  Mediation  Other ADR  Advantages and Disadvantages

4. INTERNATIONAL DISPUTES  Difficulties of Litigating  International Commercial Arbitration  Substantive & Procedural Laws  Institutions and Tribunals  Finality  Enforceability  New York Convention 1958

5. FORMS OF ADR  Mediation/Conciliation  Executive Negotiation  Early Neutral Evaluation (ENE)  Private Mini-Trials  Med-Arb and Arb-Med  Adjudication and DRBs  Other/None of the Above

6. CURRENT ISSUES  Oil Industry Preference for Litigation  Selection of Arbitral Tribunals  Failure to Grasp ADR Options Fully  Ignorance of non-Mediation ADR  Expert Determination  Excessive Lawyer Involvement  Macho Management/Lawyers

7. CASE STUDY: CATS DISPUTE  CATS - North Sea Gas Pipeline  Capacity Reservation by 3 rd Party User  Send Or Pay Obligation; £45m paid  Fall In Gas Price – Contract Uneconomic  High Court/CoA/House of Lords  Did the Subsea valve work ?  Was CATS “Available “ ?  £100m at stake; £8-12 million legal costs

8. CONCLUSIONS  Oily Myth 1: There is Certainty in a Judgement  Oily Myth 2: Need Judge for High Value Disputes  Widen The Options  Practical Decisions for Practical Disputes  Judges are NOT Engineers etc