New technology and changing processes are making oil and gas drilling and extraction more and more economic, whether involving conventional or unconventional resources. While innovation is important, it’s just as important to take proper precautions to protect it and to be able to enforce these rights against third parties, in order to maximise the value of the innovation. You get a competitive advantage from being able to prevent competitors accessing or using that technology, and IP rights allow you to benefit from licensing and collaboration arrangements with third parties.
Here are some issues to consider in protecting your IP:
- Patents are increasingly used in the oil and gas industry. In 2013 inventors filed a total of 12,062 oil and gas patent applications - three times the number of approvals sought ten years ago. This surge has been driven largely by innovations in fracking technology, with companies seeking protection over improvements to fracturing fluid composition, pressure and use. Patent applications covering methods for estimating the size of fractures, systems to provide power to isolated wells and methods for preparing fracking fluids without electricity have also been filed. If you intend to file for patent protection in Australia, the details of your application will be published and available to everyone. So if you want to keep your IP on the down low (like Coca-Cola’s precious formula), then keeping a trade secret may be more valuable than creating a patent.
- In cases where patent protection is either unavailable or inappropriate, trade secrets may be the best vehicle to protect a new technology. Unlike patent protection, trade secrets can be protected for as long as the information remains secret. However you will need to ensure that appropriate confidentiality agreements are in place with employees or third parties who learn the secret. This option may be better suited to smaller operators who don’t intend on licensing their innovation to third parties. The size of the organisation also makes it easier to control to whom your information is released.
- When deciding whether to apply for patent protection, you should consider the long term prospects for your innovation, particularly if you want to license your technology to third parties. Generally speaking, parties to licensing arrangements prefer patents because it avoids the sort of loss you might experience if your trade secret is disclosed. This scenario becomes even more likely where the technology is being licensed to multiple parties, in which case confidentiality agreements may not be sufficient to maintain a complex set of arrangements revolving around your innovation. Just because it worked for KFC’s eleven herbs and spices, doesn’t mean it will work for you.