Patent strategy could shape financing, valuation and risk in offshore energy projects
Key takeaways:
- Patent portfolios can strengthen investor confidence by demonstrating technological differentiation and competitive advantage.
- Intellectual property (IP) assets may influence company valuation, project bankability and access to certain financing opportunities.
- Offshore patent strategies require careful consideration of jurisdictional and enforcement challenges across multiple maritime regions.
- Early freedom-to-operate reviews can help reduce legal risks that could delay projects or affect financing.
- Establishing IP ownership, invention-harvesting processes and protection strategies early can support long-term commercialization and revenue protection.
The offshore energy sector has long depended on engineering innovation to unlock new reserves, improve operational efficiency and reduce project costs. Many of those innovations are embedded in proprietary technologies that companies increasingly view as strategic assets.
While patents have traditionally been discussed within legal and R&D circles, industry experts say intellectual property (IP) considerations are becoming increasingly relevant to financing discussions as offshore technologies grow more sophisticated and capital-intensive.
According to attorneys from international IP law firm Finnegan, a well-developed patent strategy can strengthen investor confidence, support project valuation and help operators manage legal risks that might otherwise complicate financing efforts.
Patents can signal innovation and competitive advantage
For investors evaluating offshore technology companies or projects built around differentiated technology, patent portfolios can provide tangible evidence of innovation.
“A robust and thoughtful approach to patent protection indicates that a company is both innovative and competitive,” Maeve O'Flynn, a partner at Finnegan, told Offshore. “For investors, assessment of a patent portfolio can provide evidence of a company’s technological assets, and can provide confidence that the technology offers a competitive advantage.”
Beyond demonstrating innovation, patent protection can help establish barriers to entry for competitors.
In the offshore sector, where technology development cycles can span many years and require significant capital investment, the ability to protect proprietary solutions may improve confidence that investments can generate returns over the long term.
“The timescale of development for emerging offshore technologies can be lengthy. Fortunately, the duration of IP rights can match such timescales, e.g. patents have a duration of up to 20 years,” O'Flynn added.
Jamie Barcombe, also a partner at Finnegan, noted that a patent strategy demonstrates a company's understanding of how its innovations differentiate it from competitors and shows that steps have been taken to protect those innovations.
“A considered patent strategy is an important asset for any innovative business,” Barcombe told Offshore. “Building a patent portfolio that protects your innovation builds investor confidence by demonstrating that you have exclusive rights in important jurisdictions.”
For companies developing proprietary offshore technologies, those rights can become part of the overall value proposition presented to investors, lenders and strategic partners.
IP assets may influence project valuation and financing options
As investors increasingly assess intangible assets alongside physical infrastructure, patent portfolios can contribute to broader discussions around company valuation and risk.
Georges Khoury, also a partner at Finnegan, said a well-structured patent portfolio can support exclusivity around innovative technologies while helping to protect future revenue streams.
“A well-structured patent portfolio provides enforceable rights that can support the company’s exclusivity to the innovative technology and protect revenue streams from competitors,” Khoury continued. “For investors and lenders, this can enhance confidence that key innovations may not be readily replicated by competitors.”
Strong patent portfolios may also create opportunities beyond traditional financing models. According to Khoury, IP assets can support alternative funding mechanisms, including IP-backed lending, allowing companies to explore additional financing pathways.
Although physical assets, such as offshore platforms, vessels and subsea infrastructure, remain central to project economics, protected IP can increasingly represent a valuable component of an offshore company's overall asset base, the lawyers said.
Offshore projects present unique jurisdictional challenges
Unlike many land-based industries, offshore developments frequently operate across maritime zones and multiple national jurisdictions, creating additional complexity for patent protection and enforcement.
The Finnegan attorneys emphasized that patents are territorial rights and that operators must understand where protections apply and where enforcement actions may be possible.
The lawyers recently examined some of these jurisdictional issues in greater detail, including how patent rights may apply to offshore activities and enforcement within maritime zones from a UK perspective.
O'Flynn pointed to the example of the UK, where patent rights related to offshore energy assets can extend into the country's Exclusive Economic Zone (EEZ). Understanding the geographical scope of protection, she said, is an important component of due diligence and risk assessment.
Barcombe added that offshore companies should consider whether patents can be structured so infringement could be demonstrated through activities occurring onshore or in port facilities, where enforcement may be more straightforward. He emphasized the importance of identifying key jurisdictions early and consulting local counsel where necessary.
For lenders and investors, these jurisdictional considerations can become part of a broader evaluation of legal exposure and project risk. A company that understands how its patents operate across relevant markets may be better positioned to demonstrate preparedness and reduce uncertainty.
Freedom-to-operate reviews can reduce financing risk
Protecting a company's own innovations represents only one side of the equation. Operators must also assess whether their technologies could infringe on third-party IP rights.
The attorneys highlighted freedom-to-operate analysis as a key component of an effective offshore IP strategy. Such reviews examine whether planned technologies, equipment or processes could conflict with existing patents.
“A company’s IP strategy must include an assessment of the IP rights of competitors and how the risk of infringing such rights is to be mitigated,” O'Flynn explained.
Conducting these assessments early can provide companies with multiple options, including redesigning certain aspects of a project, pursuing licensing agreements or challenging potentially problematic patents.
From a financing perspective, reducing the likelihood of patent disputes can remove potential obstacles that could delay projects, increase costs or create uncertainty for investors and lenders. Barcombe noted that completing appropriate freedom-to-operate analysis may provide greater confidence that investment capital is unlikely to be diverted into costly patent litigation.
Building IP strategy into project development
The attorneys said IP considerations should begin early in the project lifecycle rather than after technologies have already been developed and deployed.
For joint ventures and collaborative offshore developments, O'Flynn recommended establishing clear agreements regarding ownership and use of IP from the outset.
“Many offshore oil and gas projects are collaborative, so it is imperative to set out clearly, from the start of any project, how IP rights and obligations will be shared between the project partners,” she said.
Khoury also highlighted the importance of implementing formal invention-harvesting processes that identify patentable innovations early. Filing patent applications sooner can help reduce risks associated with public disclosure, preserve future rights and potentially strengthen the company's portfolio as projects mature.
For emerging offshore technologies (e.g., subsea processing systems, digital monitoring platforms and electrification solutions), the combination of early patent protection, freedom-to-operate analysis and clearly defined ownership structures can help support long-term commercialization strategies.
Looking beyond legal protection
As the offshore industry continues to advance technologically, IP is increasingly becoming a business and financing consideration rather than solely a legal matter.
“A company’s approach to patent protection can play a meaningful role in shaping investor confidence and access to financing for offshore projects, particularly where project value depends on differentiated and innovative technology,” Khoury concluded.
A strong patent strategy alone will not secure project financing. However, industry participants that view IP as part of a broader risk-management and value-creation framework may be better positioned to demonstrate competitiveness, protect revenue opportunities and support confidence among investors, lenders and project partners.
In an environment where technological differentiation can be a key driver of project economics, IP may play a larger role in financing discussions than many offshore companies have traditionally assumed.
About the Author
Ariana Hurtado
Editor-in-Chief
With more than a decade of copy editing, project management and journalism experience, Ariana Hurtado is a seasoned managing editor born and raised in the energy capital of the world—Houston, Texas. She currently serves as editor-in-chief of Offshore, overseeing the editorial team, its content and the brand's growth from a digital perspective.
Utilizing her editorial expertise, she manages digital media for the Offshore team. She also helps create and oversee new special industry reports and revolutionizes existing supplements, while also contributing content to Offshore's magazine, newsletters and website as a copy editor and writer.
Prior to her current role, she served as Offshore's editor and director of special reports from April 2022 to December 2024. Before joining Offshore, she served as senior managing editor of publications with Hart Energy. Prior to her nearly nine years with Hart, she worked on the copy desk as a news editor at the Houston Chronicle.
She graduated magna cum laude with a bachelor's degree in journalism from the University of Houston.