The Future of the Deepwater Offshore Oil and Gas Industry in Mexico: Uncapped Environmental Liabilities Combined with a Ceiling for Financial Guarantees?
Article from: OGEL 1 (2016), in Mexico's Oil and Gas Sector Reform
Abstract
Mexico has recently approved a set of environmental regulations applicable to the offshore oil and gas industry. The goal of these regulations is to hold the polluter liable for ecological damage. As a result, the polluter must therefore internalise the cost of environmental damage. In this sense, liabilities arising from environmental damage are uncapped. This legal obligation is complemented with a mandate to purchase environmental risk insurance to ensure that funds to restore the environment are available. However, it is uncertain how the system of insurance will work, and what these ...