Shahid Beheshti University Legal Research Quarterly 1024-0772 Articles in Press 2025 07 21 Legal Challenges of Using Product Sharing Agreement in the Underground Gas Storage (UGS) in Depleted Reservoirs Legal Challenges of Using Product Sharing Agreement in the Underground Gas Storage (UGS) in Depleted Reservoirs 105951 10.48308/jlr.2025.233617.2615 FA Ali Ghadamyari زنبیل آباد ،کوچه 42 ،پلاک 27 Mohammad Mahdi Hajian Assistant Professor, Private Law Dept., Faculty of Politics and Law, Allameh Tabataba'i University, Tehran, Iran. Journal Article 2023 10 29 Underground natural gas storage (UGS) involves gas pressurization operations for injection into porous space and its subsequent recovery. It is carried out using three common storage methods: storage in depleted oil and gas reservoirs, storage in saltcaverns and aquifers. Given the importance of storage and the efficiency of natural gas storage in depleted hydrocarbon reservoirs in our country, providing an efficient legal framework and presenting an optimal contractual model can facilitate maximum attraction of private sector investment and accelerate the development of storage reservoirs. This research aims to introduce an optimal contractual model for UGS industry development, focusing on the legal aspects of ownership within UGS and the anticipated challenges in our country. Considering the legal implications in existing legislation and a detailed examination of the technical dimensions of the issue, storage should be classified as an upstream operation. Furthermore, considering the unique characteristics of UGS and their substantive differences from the development and production of oil reservoir, along with the state ownership of the injected gas, it seems that using production-sharing agreement (PSC) will not face restrictions under existing laws. Even under stringent conditions, legal challenges regarding ownership of the extracted product and concerns about dominance and monopoly can be easily resolved. This research is conducted through the description of laws, analysis of arbitration rulings and court decisions, and legal and jurisprudential principles and rules. Underground natural gas storage (UGS) involves gas pressurization operations for injection into porous space and its subsequent recovery. It is carried out using three common storage methods: storage in depleted oil and gas reservoirs, storage in saltcaverns and aquifers. Given the importance of storage and the efficiency of natural gas storage in depleted hydrocarbon reservoirs in our country, providing an efficient legal framework and presenting an optimal contractual model can facilitate maximum attraction of private sector investment and accelerate the development of storage reservoirs. This research aims to introduce an optimal contractual model for UGS industry development, focusing on the legal aspects of ownership within UGS and the anticipated challenges in our country. Considering the legal implications in existing legislation and a detailed examination of the technical dimensions of the issue, storage should be classified as an upstream operation. Furthermore, considering the unique characteristics of UGS and their substantive differences from the development and production of oil reservoir, along with the state ownership of the injected gas, it seems that using production-sharing agreement (PSC) will not face restrictions under existing laws. Even under stringent conditions, legal challenges regarding ownership of the extracted product and concerns about dominance and monopoly can be easily resolved. This research is conducted through the description of laws, analysis of arbitration rulings and court decisions, and legal and jurisprudential principles and rules.