Regulatory Trends and Associated Risks for Satellite Connectivity in the Oil and Gas Sector

10 May 2018

On 10 May, Access Partnership attended and spoke at the Oilfield Connectivity conference, taking place in Aberdeen, UK. The conference touched upon various topics relevant to the industry, from technical communication solutions to security of data and new requirements deriving from the GDPR. Access Partnership’s Senior Consultant Vadim Doronin provided an overview of the regulatory trends and associated risks on satellite connectivity based on our knowledge and experience working in jurisdictions around the world. It is more profitable for companies to explore oil resources in the most remote places of the world, both onshore and offshore; places often without any existing terrestrial networks. All these factors make satellite connectivity the only reliable solution for communication.

At the conference it was noted that communication does not take place in a legal vacuum. Local authorities are prone to imposing strict regulatory requirements and are vigilant in enforcing them. Moreover, each jurisdiction is free to choose its own requirements. Such requirements vary from region to region, and even country to country. In Europe, there is a trend towards harmonisation and deregulation of the telecoms regulatory framework, where certain frequencies are more likely to be exempted from individual licensing. Licensing is also straightforward and less time consuming. However, this approach is not necessarily shared in other regions crucial to the oil industry, like the Middle East, Africa and Central Asia. In many countries in these regions, a number of authorisations are required to operate earth stations. These requirements can start from homologation to authorisations to operate frequencies or equipment. Non-compliance may lead to various penalties and a delay in operations.

What do companies need to do to mitigate such regulatory risks? Our presentation attempted to answer this question by providing working solutions, namely:

  • Planning networks long in advance to understand specific regulatory requirements on whether a network configuration has already been authorised and if not, can it be authorised;
  • Checking the location of a network. Location is often important in case stations are operated in high versus territorial waters. Authorities are more likely to allow operations or even in some cases offer exemptions from licensing, if a station is located outside of territorial waters;
  • Understanding the associated timeframe for compliance and regulatory costs. Having an understanding of regulatory fees is especially important as they vary from country to country, and may depend on frequency band, bandwidth or equipment; for example, in the Republic of Congo such fees could easily extend to several hundreds of thousands of dollars just for one private earth station with few Mbps. In Azerbaijan, the regulatory fee is likely to be several thousand dollars, and there are separate charges for voice and data.

The presentation concluded on a positive note. Regulatory risks do exist, but planning and careful examination of these risks make it possible to find the best solution.

For more information, please download the presentation here.

If you have any questions, please contact Vadim Doronin.

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