Associate Director Mark Thurber discussed two
related threads of PESD research on "State Choices in Hydrocarbon
Administration." The first part of the talk, based on a paper which
Mark co-authored with PESD affiliated researchers David Hults and Patrick Heller,
focused on how countries design institutions for administering their oil
sectors. It suggested that countries with certain institutional deficits
may be better off not separating commercial functions from policy and
regulatory ones in oil, even though the separation of functions approach (as pioneered by Norway) is
generally considered "best practice" in oil sector administration.
second part of Mark's talk described statistical analysis he is performing to
quantitatively test the hypothesis advanced by PESD consulting professor Pete
Nolan that private oil companies will preferentially operate at "frontiers,"
for which state-controlled oil companies cannot adequately manage risks for
their host governments. Patterns of company operatorship of exploration
wells in the 1970s and 1980s, derived from data from oil and gas research and
consultancy company Wood Mackenzie, suggest that this hypothesis indeed was
statistically supported for frontier exploration in deep water.