#maritimeDisputedAreas

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Practice on Provisional Arrangements in maritime Disputed Areas, JOINT DEVELOPMENT ZONES, Kuwait-Saudi Arabia case

Background A joint development zone in the Persian Gulf between Kuwait and Saudi Arabia developed from the “Neutral Zone” established by the Al Uqair Protocol of 1922 in their land border areas where a land boundary line could not be agreed upon. This provided, that “. . . the Government of Najd and Kuwait will share equal rights until through the good offices of Great Britain a further agreement is made . . . concerning it”. The Neutral Zone covered a land area of 5,700 km2. Through the history of exploration, common and co-ordinated modes of exploitation have been established in the Neutral Zone. Similar practices of joint exploration and exploitation also have been established in offshore areas of the Neutral Zone. In 1965 an international boundary line was drawn between the countries in the Neutral Zone. The boundary line extends from land to the territorial sea. However, the boundary does not affect the nature of the Neutral Zone and its offshore areas in terms of exploitation of natural resources. With respect to the submerged area beyond the territorial sea, the two countries agreed to exercise their equal rights by means of shared exploration unless the two countries would agree otherwise.

Map 1: Neutral Zone between Kuwait and Saudi Arabia (Source: M. Miyoshi, The Joint Development of Offshore Oil and Gas in relation to Maritime Boundary Delimitation, IBRU Maritime Briefing 1999) Methods of Shaping the JDZ As the background of the establishment of the Neutral Zone shows, the Neutral Zone in the land territory corresponded to the area where the two countries could not agree on land boundaries. The submersed maritime zone pertaining to the Neutral Zone of the land also became a joint development zone later on. However, the seaward limit of the joint continental shelf seems obscure because there is no maritime boundary between Kuwait and Iran until now. Operational Mechanism and the Effectiveness of the Arrangement The Protocol of 1922 does not provide a detailed mechanism to facilitate joint development. What is clear from the Protocol is that the two States have equal shares in joint and undivided property in the Neutral Zone. Each government granted concessions to their own concessionaires but let their concessionaires co-operate with each other. For example, the Pacific Western Oil Corporation (subsequently Getty Oil Company), which is the concessionaire of Saudi Arabia, entered into an agreement on joint drilling with American Independent Oil Company (Aminoil) in 1956. The two companies signed a joint operating agreement in 1960. The joint drilling and joint operation of the two concessionaires were under the supervision of a Joint Operating Committee. Later, in 1965, the two governments established a Joint Permanent Committee. It is noteworthy that of the seven jointly developed fields in the Persian Gulf, four, including the largest, are found in the Neutral Zone. Delimitation Issue As there are two islands in dispute between Kuwait and Saudi Arabia, the delimitation of maritime boundaries has proved to be difficult. The two islands are Qarah and Umm al-Maradim. These have been under the Kuwaiti control and claimed by Saudi Arabia. In 1961 Kuwait offered to Saudi Arabia a half share of any income accruing from future exploitation in return for the Saudi Arabian acknowledgement of the Kuwaiti sovereignty over the islands. However, Saudi Arabia has yet to make a decision on the offer. Read the full article

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