On the Interplay between Stabilization Clauses and Sustainable Development: The Case of Tullow Oil plc in Turkana

Abstract

Prior to exploration activities by Tullow Oil plc in Kenya, several Production Sharing Contracts (PSC’s) were signed between the Government of Kenya and the multinational corporation over exploration activities in Turkana County. These PSC’s and terms within them were however not disclosed to the public. One such term is the stabilization clause(s) within these agreements which in essence gives the company assurances that the laws applicable to the contracts are not subject to change at the government’s whim.