Fundamental change in the circumstance in upstream oil and gas contracts (Case study: Iran and common law legal system)

Upstream oil and gas contracts are the most important administrative contracts with technical, economic, social, legal, financial, political, environmental aspect contracts. Long term and continuous, the need to spend heavy costs and large capital, unknown reservoir and market behavior, high risk and uncertainty and complexity and uncertainty, multidimensional of the contracted goods (oil and gas), the existence of various private, public and Transnational corporations, governance and government issues, and the public ownership of oil and gas resources in some countries have increased the risks of these contracts and lead to occurrence of accidents and fundamental changes in the contract. In this study, we have examined the fundamental change of circumstance in upstream oil and gas contracts in common law system and Iran legal system. We surveyed the concept and basis, conditions, features and legal effects and consequences of this contractual excuse. The results show that fundamental change of circumstance is recognized as a contractual excuse in upstream oil and gas contracts in these two legal systems. The main criteria in these contracts are continuence of rights and duties of parties and the effects and consequences of Fundamental changes in circumstances should be interpreted and adjusted in accordance with these criteria and the specific characteristics of these contracts and different from general non-oil contracts.