Petroleum and Gas (Royalty) Regulation 2004

ch 1 pt 2 hdg om 2018 SL No. 135 s 189

1Short title

This regulation may be cited as the Petroleum and Gas (Royalty) Regulation 2004.

s 1 amd 2018 SL No. 135 s 187

3Dictionary

The dictionary in schedule 1 defines particular words used in this regulation.

s 3 amd 2020 Act No. 30 s 89

ch 6 hdg amd 2018 SL No. 135 s 193

sub 2020 Act No. 30 s 90

ch 6 pt 1 hdg prev ch 6 pt 1 hdg om 2017 SL No. 163 s 14

pres ch 6 pt 1 hdg ins 2020 Act No. 30 s 97

ch 6 pt 1 div 1 hdg ins 2020 Act No. 30 s 97

133 Purpose of chapter

This chapter prescribes—

(a)for section 590(2)(a) of the Act, the time on or before which petroleum royalty must be paid; and

(b)for section 590(2)(b) of the Act, the way in which petroleum royalty is calculated; and

(c)for section 590(2)(c) of the Act, the rate at which petroleum royalty is payable.

s 133 prev s 133 amd 2006 SL No. 293 s 8

sub 2018 SL No. 135 s 196

amd 2019 SL No. 112 s 18; 2020 SL No. 116 s 10

om 2020 Act No. 30 s 91

pres s 33 ins 2020 Act No. 30 s 97

ch 6 pt 1 div 2 hdg ins 2020 Act No. 30 s 97

134Definitions for chapter

(1)In this chapter—

average hedge settlement rate, for a royalty return period, means the average, worked out for the royalty return period, of the hedge settlement rates for each day in the royalty return period.

domestic gas see section 135.

gas means petroleum in a gaseous state at standard temperature and pressure.

hedge settlement rate, for a day, means the WM/Reuters Australian Fix 10.00a.m. rate on the day.

independent buyer, in relation to a petroleum producer or a reseller for the producer, means a person who is not a relevant entity for the producer.

liquid petroleum see section 138.

LNG means liquefied natural gas.

LNG project means an LNG project under a determination of the revenue commissioner under section 139.

LNG project buyer, in relation to a petroleum producer or a reseller for the producer, means a person who the producer or reseller knows is a member of an LNG project because—

(a)the person has, under section 141(2), given the producer or the reseller a notice stating that the person is a member of the LNG project; or

(b)the revenue commissioner has, under section 141(4), told the producer or the reseller that the person is a member of the LNG project.

member, of an LNG project, means a member of an LNG project under a determination of the revenue commissioner under section 139.

oil means petroleum in a liquid state.

project gas see section 137.

relevant entity, for a petroleum producer, means—

(a)for a petroleum producer that is a corporation—

(i)an associated entity of the corporation within the meaning of the Corporations Act, section 50AAA; or

(ii)a related entity of the corporation within the meaning of the Corporations Act, section 9, definition related entity; or

(iii)a related party of the corporation within the meaning of the Corporations Act, section 228; or

(b)for a petroleum producer who is an individual—a related person of the individual within the meaning of the Duties Act 2001, section 61, other than section 61(1)(d) of that Act.

reseller, for a petroleum producer, means a relevant entity for the producer that sells, or otherwise transfers ownership of, petroleum that is produced by the producer and owned by the reseller.

standard temperature and pressure means an absolute pressure of 101.325kPa at a temperature of 15ºC.

supply gas see section 136.

(2)To remove any doubt, it is declared that, for this chapter, a reference to a petroleum producer includes a participant in a joint venture, or other arrangement, involving the production of petroleum who is taken to be a petroleum producer under section 590(4) of the Act.

s 134 prev s 314 sub 2008 SL No. 263 s 4

om 2017 SL No. 163 s 16

pres s 134 ins 2020 Act No. 30 s 97

135What is domestic gas

(1)Petroleum produced by a petroleum producer in a royalty return period is domestic gas if—

(a)the petroleum is gas; and

(b)during the royalty return period, the petroleum is—

(i)sold or otherwise transferred, either directly by the producer or indirectly by the producer through 1 or more resellers for the producer, to a person who is not an LNG project buyer; or

(ii)flared, used or vented; or

(iii)if the producer is not a member of an LNG project—stored by, or kept in the possession of, the producer or 1 or more resellers for the producer; and

(c)the petroleum is not supply gas.

(2)In this section—

use, petroleum, does not include convert the petroleum into LNG.

s 135 prev s 135 amd 2005 SL No. 300 s 43; 2007 SL No. 132 s 18; 2007 SL No. 312 s 42; 2010 SL No. 143 s 8; 2011 SL No. 44 s 28; 2011 Act No. 18 s 404 sch 4 pt 1; 2015 SL No. 23 s 8

sub 2013 SL No. 195 s 6

amd 2016 SL No. 169 s 109 sch 4

om 2018 SL No. 135 s 197

pres s 135 ins 2020 Act No. 30 s 97

136What is supply gas

Petroleum produced by a petroleum producer in a royalty return period is supply gas if—

(a)the petroleum is gas; and

(b)the petroleum is not produced by the producer as a member of an LNG project; and

(c)during the royalty return period, the petroleum is sold or otherwise transferred, either directly by the producer or indirectly by the producer through 1 or more resellers for the producer, to a person who is an LNG project buyer.

s 136 prev s 136 om 2007 SL No. 132 s 19

pres s 136 ins 2020 Act No. 30 s 97

137What is project gas

Petroleum produced by a petroleum producer in a royalty return period is project gas if—

(a)the petroleum is gas; and

(b)the petroleum is produced by the petroleum producer as a member of an LNG project; and

(c)the petroleum is not domestic gas.

s 137 prev s 137 om 2007 SL No. 132 s 19

pres s 137 ins 2020 Act No. 30 s 97

138What is liquid petroleum

Petroleum produced by a petroleum producer in a royalty return period is liquid petroleum if the petroleum is oil.

s 138 prev s 138 amd 2007 SL No. 132 s 21

om 2013 SL No. 195 s 7

pres s 138 ins 2020 Act No. 30 s 97

ch 6 pt 2 hdg prev ch 6 pt 2 hdg amd 2017 SL No. 163 s 15; 2018 SL No. 135 s 194

om 2020 Act No. 30 s 91

pres ch 6 pt 2 hdg ins 2020 Act No. 30 s 97

ch 6 pt 2 div 1 hdg amd 2018 SL No. 135 s 195

om 2020 Act No. 30 s 92

ch 6 pt 2 div 2 hdg amd 2010 SL No. 143 s 6

om 2018 SL No. 135 s 197

ch 6 pt 2 div 2 hdg sub 2010 SL No. 143 s 7

om 2018 SL No. 135 s 197

ch 6 pt 2 div 2 hdg om 2007 SL No. 132 s 19

ch 6 pt 2 div 2 hdg amd 2007 SL No. 132 s 20; 2010 SL No. 143 s 9

sub 2013 SL No. 195 s 7

om 2018 SL No. 135 s 197

ch 6 pt 2 div 2 hdg amd 2010 SL No. 143 s 9

om 2018 SL No. 135 s 197

ch 6 pt 2 div 3 hdg om 2017 SL No. 163 s 17

ch 6 pt 2 div 4 hdg om 2020 Act No. 30 s 93

ch 6 pt 2 div 4 hdg ins 2010 SL No. 1 s 3

om 2020 Act No. 30 s 94

ch 6 pt 2 div 4 hdg ins 2010 SL No. 1 s 4

sub 2016 SL No. 25 s 16

om 2020 Act No. 30 s 94

ch 6 pt 2 div 4 hdg ins 2016 SL No. 25 s 16

om 2020 Act No. 30 s 94

ch 6 pt 2 div 4 hdg ins 2010 SL No. 1 s 4

om 2020 Act No. 30 s 94

ch 6 pt 2 div 4 hdg ins 2019 Act No. 20 s 61

om 2020 Act No. 30 s 94

ch 6 pt 2 div 5 hdg om 2017 SL No. 163 s 17

139 Revenue commissioner may make determination that petroleum venture is LNG project

(1)This section applies if the revenue commissioner believes a petroleum venture exists between—

(a)1 or more petroleum producers; and

(b)1 or more other persons each of whom is a relevant entity for a petroleum producer mentioned in paragraph (a).

(2)The revenue commissioner may make a determination that the petroleum venture is an LNG project.

(3)If the revenue commissioner makes a determination under subsection (2), the revenue commissioner must also make a determination of who are the members of the LNG project.

(4)The revenue commissioner must give each person who is a member of the LNG project notice of the determinations under subsections (2) and (3).

(5)The notice must include the following information—

(a)a description of the petroleum venture that constitutes the LNG project;

(b)the names of the members of the LNG project;

(c)the names of the petroleum producers who are members of the LNG project;

(d)the petroleum tenures under which petroleum is produced for the LNG project.

(6)A determination under subsection (2) or (3) takes effect on the day stated in the notice.

(7)The revenue commissioner may amend or revoke a determination made under subsection (2) or (3) by notice given to each person who is, or was before the amendment or revocation, a member of the LNG project.

(8)An amendment or revocation under subsection (7) takes effect on the day stated in the notice.

(9)For subsections (6) and (8), the day stated in the notice may be a day before the day on which the revenue commissioner makes, amends or revokes the determination.

(10)In this section—

petroleum venture means a joint venture or other arrangement involving—

(a)the production of gas for the purpose of converting the gas into LNG; and

(b)the processing, transportation, storage, conversion, sale or purchase of the gas or LNG mentioned in paragraph (a).

s 139 prev s 139 amd 2005 SL No. 300 s 44; 2007 SL No. 132 s 22; 2009 SL No. 186 s 17; 2010 SL No. 143 s 10; 2010 SL No. 248 s 6; 2011 Act No. 16 s 31

sub 2013 SL No. 195 s 8

amd 2016 SL No. 196 s 7

om 2018 SL No. 135 s 197

pres s 139 ins 2020 Act No. 30 s 97

140Revenue commissioner must reassess amount of royalty payable if particular determinations made

(1)This section applies if the revenue commissioner—

(a)has made, amended or revoked a determination under section 139 (each a new decision); and

(b)has made an assessment under the Taxation Administration Act 2001 of the amount of petroleum royalty payable by a petroleum producer for a royalty return period without having regard to the new decision.

(2)The revenue commissioner must reassess, under the Taxation Administration Act 2001, the amount of petroleum royalty payable by the petroleum producer for the royalty return period having regard to the new decision.

Note—

See the Taxation Administration Act 2001, part 4 for the revenue commissioner’s obligation to refund any excess amount on the making of the reassessment.

(3)Subsection (4) applies if, on the reassessment, the petroleum producer is liable for penalty tax, unpaid tax interest or a civil penalty (each a relevant liability).

(4)The revenue commissioner must remit the relevant liability to the extent it is payable only because of the operation of subsection (2).

s 140 prev s 140 amd 2009 SL No. 186 s 18; 2010 SL No. 143 s 11

om 2018 SL No. 135 s 197

pres s 140 ins 2020 Act No. 30 s 97

141Notification of status when petroleum producer, or reseller for producer, sells to member of LNG project

(1)This section applies if a person—

(a)is a member of an LNG project; and

(b)purchases gas from a petroleum producer, or a reseller for the producer, who is not a member of the LNG project mentioned in paragraph (a).

(2)The person must, as soon as reasonably practicable after the purchase, give the petroleum producer, or the reseller for the producer, a notice stating that the person is a member of the LNG project.

Maximum penalty—100 penalty units.

(3)However, subsection (2) does not apply if the person has already given the petroleum producer, or the reseller for the producer, a notice stating that the person is a member of the LNG project.

(4)The revenue commissioner may tell the petroleum producer, or the reseller for the producer, that the person is a member of the LNG project.

s 141 prev s 141 sub 2010 SL No. 143 s 12; 2013 SL No. 195 s 9

om 2018 SL No. 135 s 197

pres s 141 ins 2020 Act No. 30 s 97

142 Notification of revenue commissioner when persons involved in petroleum venture change

(1)Subsection (2) applies if a person who is a member of an LNG project (the departing member) stops being involved in the petroleum venture that constitutes the LNG project.

(2)Each petroleum producer who continues to be involved in the petroleum venture must, within 30 days after the departing member stops being involved in the venture, give the revenue commissioner a notice stating that the departing member has stopped being involved in the venture.

Maximum penalty—100 penalty units.

(3)Subsection (4) applies if a person (the new participant) starts being involved in a petroleum venture that constitutes an LNG project.

(4)Each petroleum producer, including the new participant if the new participant is a petroleum producer, who is involved in the petroleum venture must, within 30 days after the new participant starts being involved in the venture, give the revenue commissioner a notice stating that the new participant has started being involved in the venture.

Maximum penalty—100 penalty units.

(5)A petroleum producer may give a notice under subsection (2) or (4) jointly with another petroleum producer.

(6)The revenue commissioner must, after receiving a notice under subsection (2) or (4), make a decision about whether to amend or revoke—

(a)the determination of the LNG project; or

(b)the determination of the members of the LNG project.

s 142 prev s 142 amd 2010 SL No. 143 s 13

sub 2013 SL No. 195 s 9

om 2018 SL No. 135 s 197

pres s 142 ins 2020 Act No. 30 s 97

ch 6 pt 3 hdg prev ch 6 pt 3 hdg om 2017 SL No. 163 s 18

pres ch 6 pt 3 hdg ins 2020 Act No. 30 s 97

ch 6 pt 3 div 1 hdg ins 2020 Act No. 30 s 97

143 Definitions for part

In this part—

relevant period, for a royalty return period, means—

(a)if the royalty return period is a calendar quarter—the 3-month period starting on the day that is 4 months immediately before the start of the royalty return period; or

(b)if the royalty return period is a financial year—the 12-month period starting on the day that is 4 months immediately before the start of the royalty return period.

volume, of petroleum, means—

(a)for domestic gas, supply gas, project gas, gas or LNG—the volume converted to gigajoules; or

(b)for liquid petroleum or oil—the volume measured in barrels.

s 143 prev s 143 amd 2010 SL No. 143 s 15; 2010 SL No. 248 s 6; 2013 SL No. 195 s 10

om 2018 SL No. 135 s 197

pres s 143 ins 2020 Act No. 30 s 97

ch 6 pt 3 div 2 hdg ins 2020 Act No. 30 s 97

144Definitions for division

In this division—

average sales price, for domestic gas for a petroleum producer for a royalty return period, see sections 146 and 147.

benchmark price, for domestic gas for a royalty return period, means the firm End of Day Wallumbilla Benchmark Price averaged over the period.

s 144 prev s 144 amd 2010 SL No. 143 s 16; 2010 SL No. 248 s 6

om 2018 SL No. 135 s 197

pres s 144 ins 2020 Act No. 30 s 97

145 Petroleum royalty for domestic gas

If petroleum produced by a petroleum producer in a royalty return period is domestic gas, the producer must pay petroleum royalty for the period on the volume of domestic gas produced in the period at the following rate—

(a)if the average sales price for domestic gas for the producer for the period is not more than $3 per gigajoule—0.02 cents per gigajoule for each 1 cent per gigajoule more than $0 per gigajoule;

(b)if the average sales price for domestic gas for the producer for the period is more than $3, but not more than $8, per gigajoule—6 cents per gigajoule plus 0.08 cents per gigajoule for each 1 cent per gigajoule more than $3 per gigajoule;

(c)if the average sales price for domestic gas for the producer for the period is more than $8 per gigajoule—46 cents per gigajoule plus 0.10 cents per gigajoule for each 1 cent per gigajoule more than $8 per gigajoule.

s 145 prev s 145 amd 2005 SL No. 263 s 8; 2008 SL No. 158 s 13

om 2017 SL No. 163 s 17

pres s 145 ins 2020 Act No. 30 s 97

146 What is the average sales price for domestic gas

(1)The average sales price for domestic gas for a petroleum producer for a royalty return period is worked out using the following formula—

      where—

ASP is the average sales price.

AR is the total revenue from all gas sold in the royalty return period, either directly by the producer or indirectly by the producer through 1 or more resellers for the producer, to a person who—

(a)is not an LNG project buyer; and

(b)is an independent buyer.

AV is the total volume of all gas sold in the royalty return period, either directly by the producer or indirectly by the producer through 1 or more resellers for the producer, to a person who—

(a)is not an LNG project buyer; and

(b)is an independent buyer.

DS is the deemed sales value of all gas sold in the royalty return period, either directly by the producer or indirectly by the producer through 1 or more resellers for the producer, to a person who—

(a)is not an LNG project buyer; and

(b)is not an independent buyer.

DV is the total volume of all gas sold in the royalty return period, either directly by the producer or indirectly by the producer through 1 or more resellers for the producer, to a person who—

(a)is not an LNG project buyer; and

(b)is not an independent buyer.

(2)For subsection (1), the deemed sales value of all gas sold in the royalty return period, either directly by the producer or indirectly by the producer through 1 or more resellers for the producer, to a person who is not an LNG project buyer and is not an independent buyer is worked out using the following formula—

      where—

DS is the deemed sales value.

BP is the benchmark price for domestic gas for the royalty return period.

DV is the total volume of all gas sold in the royalty return period, either directly by the producer or indirectly by the producer through 1 or more resellers for the producer, to a person who—

(a)is not an LNG project buyer; and

(b)is not an independent buyer.

s 146 prev s 146 amd 2005 SL No. 263 s 9; 2008 SL No. 158 s 14

om 2017 SL No. 163 s 17

pres s 146 ins 2020 Act No. 30 s 97

147 When average sales price is the benchmark price

(1)This section applies in relation to domestic gas produced by a petroleum producer in a royalty return period if—

(a)an election made by the producer under subsection (3) is in effect; or

(b)the producer does not provide, for an assessment, the information required to work out, under section 146, the average sales price for domestic gas for the producer for the period; or

(c)no gas is sold in the period, either directly by the producer or indirectly by the producer through 1 or more resellers for the producer, to a person who—

(i)is not an LNG project buyer; and

(ii)is an independent buyer; or

(d)the revenue commissioner considers it is appropriate for the protection of the public revenue for subsection (2) to apply.

(2)Despite section 146, the average sales price for domestic gas for the petroleum producer for the royalty return period is the benchmark price for domestic gas for the period.

(3)A petroleum producer may make an election in a royalty return lodged by the producer for subsection (2) to apply.

(4)An election made by a petroleum producer under subsection (3)—

(a)starts on the first day of the royalty return period for the royalty return in which the election is made; and

(b)continues in effect for each royalty return period after the royalty return period mentioned in paragraph (a) unless the revenue commissioner ends the election under subsection (6).

(5)A petroleum producer may apply to the revenue commissioner in the approved form to end an election made under subsection (3).

(6)The revenue commissioner may decide to end the election only if the revenue commissioner considers ending the election is appropriate having regard to all of the circumstances, including, for example, the protection of the public revenue.

(7)The revenue commissioner must give the petroleum producer notice of a decision under subsection (6).

(8)The election ends on the day stated in the notice.

(9)For subsection (8), the day stated in the notice may be a day before the day on which the petroleum producer made the application under subsection (5) to end the election.

(10)In making a decision under subsection (1)(d), the revenue commissioner may have regard to any of the following matters—

(a)any arrangements existing between the petroleum producer, or 1 or more resellers for the producer, and a person who purchases domestic gas from the producer or reseller;

(b)the number of sales in the royalty return period of domestic gas produced by the petroleum producer;

(c)the volume of domestic gas produced by the petroleum producer in the royalty return period that is sold to an independent buyer;

(d)the volume of domestic gas produced by the petroleum producer in the royalty return period that is sold to a person other than an independent buyer;

(e)any other matter the revenue commissioner considers relevant.

(11)The revenue commissioner must give a petroleum producer notice of a decision under subsection (1)(d).

(12)The decision takes effect on the day stated in the notice.

(13)For subsection (12), the day stated in the notice may be a day before the day on which the revenue commissioner makes the decision.

s 147 prev s 147 amd 2008 SL No. 158 s 15; 2011 Act No. 16 s 33

sub 2011 SL No. 295 s 12

amd 2012 SL No. 169 s 14; 2014 SL No. 123 s 22; 2014 SL No. 227 s 9

om 2020 Act No. 30 s 94

pres s 147 ins 2020 Act No. 30 s 97

ch 6 pt 3 div 3 hdg ins 2020 Act No. 30 s 97

148Definitions for division

In this division—

average sales price, for supply gas for a petroleum producer for a royalty return period, see sections 148B and 148D.

benchmark price, for supply gas for a royalty return period, see section 148C.

s 148 prev s 148 amd 2008 SL No. 158 s 16; 2011 Act No. 16 s 34; 2011 SL No. 295 s 13; 2014 SL No. 123 s 24; 2014 SL No. 227 s 10; 2019 Act No. 20 s 57; 2019 SL No. 112 s 19

om 2020 Act No. 30 s 94

pres s 148 ins 2020 Act No. 30 s 97

148A Petroleum royalty for supply gas

If petroleum produced by a petroleum producer in a royalty return period is supply gas, the producer must pay petroleum royalty for the period on the volume of supply gas produced in the period at the following rate—

(a)if the average sales price for supply gas for the producer for the period is not more than $3 per gigajoule—0.05 cents per gigajoule for each 1 cent per gigajoule more than $0 per gigajoule;

(b)if the average sales price for supply gas for the producer for the period is more than $3, but not more than $8, per gigajoule—15 cents per gigajoule plus 0.10 cents per gigajoule for each 1 cent per gigajoule more than $3 per gigajoule;

(c)if the average sales price for supply gas for the producer for the period is more than $8 per gigajoule—65 cents per gigajoule plus 0.125 cents per gigajoule for each 1 cent per gigajoule more than $8 per gigajoule.

s 148A prev s 148A ins 2010 SL No. 1 s 4

sub 2016 SL No. 25 s 16

om 2020 Act No. 30 s 94

pres s 148A ins 2020 Act No. 30 s 97

148B What is the average sales price for supply gas

(1)The average sales price for supply gas for a petroleum producer for a royalty return period is worked out using the following formula—

      where—

ASP is the average sales price.

AR is the total revenue from all gas sold in the royalty return period, either directly by the producer or indirectly by the producer through 1 or more resellers for the producer, to a person who—

(a)is an LNG project buyer; and

(b)is an independent buyer.

AV is the total volume of all gas sold in the royalty return period, either directly by the producer or indirectly by the producer through 1 or more resellers for the producer, to a person who—

(a)is an LNG project buyer; and

(b)is an independent buyer.

DS is the deemed sales value of all gas sold in the royalty return period, either directly by the producer or indirectly by the producer through 1 or more resellers for the producer, to a person who—

(a)is an LNG project buyer; and

(b)is not an independent buyer.

DV is the total volume of all gas sold in the royalty return period, either directly by the producer or indirectly by the producer through 1 or more resellers for the producer, to a person who—

(a)is an LNG project buyer; and

(b)is not an independent buyer.

(2)For subsection (1), the deemed sales value of all gas sold in the royalty return period, either directly by the petroleum producer or indirectly by the producer through 1 or more resellers for the producer, to a person who is an LNG project buyer and is not an independent buyer is worked out using the following formula—

      where—

DS is the deemed sales value.

BP is the benchmark price for supply gas for the royalty return period.

DV is the total volume of all gas sold in the royalty return period, either directly by the producer or indirectly by the producer through 1 or more resellers for the producer, to a person who—

(a)is an LNG project buyer; and

(b)is not an independent buyer.

s 148B prev s 148B ins 2010 SL No. 1 s 4

amd 2014 SL No. 123 s 25

sub 2016 SL No. 25 s 16

amd 2019 Act No. 20 s 58

om 2020 Act No. 30 s 94

pres s 148B ins 2020 Act No. 30 s 97

148C What is the benchmark price for supply gas

The benchmark price for supply gas for a royalty return period is the price worked out using the following formula—

where—

BP is the benchmark price for supply gas.

SP is the average, for the relevant period for the royalty return period, of the daily Europe Brent Spot Price FOB (Dollars per Barrel) converted into Australian dollars at the average hedge settlement rate for the royalty return period.

s 148C prev s 148C ins 2010 SL No. 1 s 4

sub 2016 SL No. 25 s 16

amd 2019 Act No. 20 s 69 sch 1

om 2020 Act No. 30 s 94

pres s 148C ins 2020 Act No. 30 s 97

148D When average sales price is the benchmark price

(1)This section applies in relation to supply gas produced by a petroleum producer in a royalty return period if—

(a)an election made by the producer under subsection (3) is in effect; or

(b)the producer does not provide, for an assessment, the information required to work out, under section 148B, the average sales price for supply gas for the producer for the period; or

(c)no gas is sold in the period, either directly by the producer or indirectly by the producer through 1 or more resellers for the producer, to a person who—

(i)is an LNG project buyer; and

(ii)is an independent buyer; or

(d)the revenue commissioner considers it is appropriate for the protection of the public revenue for subsection (2) to apply.

(2)Despite section 148B, the average sales price for supply gas for the petroleum producer for the royalty return period is the benchmark price for supply gas for the period.

(3)A petroleum producer may make an election in a royalty return lodged by the producer for subsection (2) to apply.

(4)An election made by a petroleum producer under subsection (3)—

(a)starts on the first day of the royalty return period for the royalty return in which the election is made; and

(b)continues in effect for each royalty return period after the royalty return period mentioned in paragraph (a) unless the revenue commissioner ends the election under subsection (6).

(5)A petroleum producer may apply to the revenue commissioner in the approved form to end an election made under subsection (3).

(6)The revenue commissioner may decide to end the election only if the revenue commissioner considers ending the election is appropriate having regard to all of the circumstances, including, for example, the protection of the public revenue.

(7)The revenue commissioner must give the petroleum producer notice of a decision under subsection (6).

(8)The election ends on the day stated in the notice.

(9)For subsection (8), the day stated in the notice may be a day before the day on which the petroleum producer made the application under subsection (5) to end the election.

(10)In making a decision under subsection (1)(d), the revenue commissioner may have regard to any of the following matters—

(a)any arrangements existing between the petroleum producer, or 1 or more resellers for the producer, and a person who purchases supply gas from the producer or reseller;

(b)the number of sales in the royalty return period of supply gas produced by the petroleum producer;

(c)the volume of supply gas produced by the petroleum producer in the royalty return period that is sold to an independent buyer;

(d)the volume of supply gas produced by the petroleum producer in the royalty return period that is sold to a person other than an independent buyer;

(e)any other matter the revenue commissioner considers relevant.

(11)The revenue commissioner must give a petroleum producer notice of a decision under subsection (1)(d).

(12)The decision takes effect on the day stated in the notice.

(13)For subsection (12), the day stated in the notice may be a day before the day on which the revenue commissioner makes the decision.

s 148D prev s 148D ins 2010 SL No. 1 s 4

sub 2016 SL No. 25 s 16

om 2020 Act No. 30 s 94

pres s 148D ins 2020 Act No. 30 s 97

ch 6 pt 3 div 4 hdg ins 2020 Act No. 30 s 97

148E Definitions for division

In this division—

average sales price, for project gas for a petroleum producer for a royalty return period, see sections 148G and 148I.

benchmark price, for project gas for a royalty return period, see section 148H.

s 148E prev s 148E ins 2010 SL No. 1 s 4

sub 2016 SL No. 25 s 16

om 2020 Act No. 30 s 94

pres s 148E ins 2020 Act No. 30 s 97

148F Petroleum royalty for project gas

If petroleum produced by a petroleum producer in a royalty return period is project gas, the producer must pay petroleum royalty for the period on the volume of project gas produced in the period at the following rate—

(a)if the average sales price for project gas for the producer for the period is not more than $9 per gigajoule—0.03 cents per gigajoule for each 1 cent per gigajoule more than $0 per gigajoule;

(b)if the average sales price for project gas for the producer for the period is more than $9, but not more than $14, per gigajoule—27 cents per gigajoule plus 0.09 cents per gigajoule for each 1 cent per gigajoule more than $9 per gigajoule;

(c)if the average sales price for project gas for the producer for the period is more than $14 per gigajoule—72 cents per gigajoule plus 0.125 cents per gigajoule for each 1 cent per gigajoule more than $14 per gigajoule.

s 148F prev s 148F ins 2010 SL No. 1 s 4

sub 2016 SL No. 25 s 16

om 2020 Act No. 30 s 94

pres s 148F ins 2020 Act No. 30 s 97

148G What is the average sales price for project gas

(1)The average sales price for project gas for a petroleum producer for a royalty return period is worked out using the following formula—

      where—

ASP is the average sales price.

AR is the total revenue from all LNG sold in the royalty return period, by each member of the LNG project of which the producer is a member, to a person who is neither a member of the LNG project nor a relevant entity for a member of the LNG project.

AV is the total volume of all LNG sold in the royalty return period, by each member of the LNG project of which the producer is a member, to a person who is neither a member of the LNG project nor a relevant entity for a member of the LNG project.

DS is the deemed sales value of all LNG sold in the royalty return period, by each member of the LNG project of which the producer is a member, to a person who is either a member of the LNG project or a relevant entity for a member of the LNG project.

DV is the total volume of all LNG sold in the royalty return period, by each member of the LNG project of which the producer is a member, to a person who is either a member of the LNG project or a relevant entity for a member of the LNG project.

(2)For subsection (1), the deemed sales value of all LNG sold in the period, by each member of the LNG project of which the petroleum producer is a member, to a person who is either a member of the LNG project or a relevant entity for a member of the LNG project is worked out using the following formula—

      where—

DS is the deemed sales value.

BP is the benchmark price for project gas for the royalty return period.

DV is the total volume of all LNG sold in the royalty return period, by each member of the LNG project of which the producer is a member, to a person who is either a member of the LNG project or a relevant entity for a member of the LNG project.

s 148G prev s 148G ins 2010 SL No. 1 s 4

sub 2016 SL No. 25 s 16

om 2020 Act No. 30 s 94

pres s 148G ins 2020 Act No. 30 s 97

148H What is the benchmark price for project gas

The benchmark price for project gas for a royalty return period is the price worked out using the following formula—

where—

BP is the benchmark price for project gas.

SP is the average, for the relevant period for the royalty return period, of the daily Europe Brent Spot Price FOB (Dollars per Barrel) converted into Australian dollars at the average hedge settlement rate for the royalty return period.

s 148H prev s 148H ins 2010 SL No. 1 s 4

amd 2014 SL No. 123 s 26

sub 2016 SL No. 25 s 16

om 2020 Act No. 30 s 94

pres s 148H ins 2020 Act No. 30 s 97

148I When average sales price is the benchmark price

(1)This section applies in relation to project gas produced by a petroleum producer in a royalty return period if—

(a)an election made by the producer under subsection (3) is in effect; or

(b)the producer does not provide, for an assessment, the information required to work out, under section 148G, the average sales price for project gas for the producer for the period; or

(c)no LNG is sold in the period, by a member of the LNG project of which the producer is a member, to a person who is neither a member of the LNG project nor a relevant entity for a member of the LNG project; or

(d)the revenue commissioner considers it is appropriate for the protection of the public revenue for subsection (2) to apply.

(2)Despite section 148G, the average sales price for project gas for the petroleum producer for the royalty return period is the benchmark price for project gas for the period.

(3)A petroleum producer may make an election in a royalty return lodged by the producer for subsection (2) to apply.

(4)An election made by a petroleum producer under subsection (3)—

(a)starts on the first day of the royalty return period for the royalty return in which the election is made; and

(b)continues in effect for each royalty return period after the royalty return period mentioned in paragraph (a) unless the revenue commissioner ends the election under subsection (6).

(5)A petroleum producer may apply to the revenue commissioner in the approved form to end an election made under subsection (3).

(6)The revenue commissioner may decide to end the election only if the revenue commissioner considers ending the election is appropriate having regard to all of the circumstances, including, for example, the protection of the public revenue.

(7)The revenue commissioner must give the petroleum producer notice of a decision under subsection (6).

(8)The election ends on the day stated in the notice.

(9)For subsection (8), the day stated in the notice may be a day before the day on which the petroleum producer made the application under subsection (5) to end the election.

(10)In making a decision under subsection (1)(d), the revenue commissioner may have regard to any of the following matters—

(a)any arrangements existing between a member of the LNG project of which the petroleum producer is a member and a person who purchases LNG from a member of the LNG project;

(b)the number of sales of LNG in the royalty return period by all members of the LNG project of which the petroleum producer is a member;

(c)the volume of LNG sold in the royalty return period by all members of the LNG project of which the petroleum producer is a member to a person who is neither a member of the LNG project nor a relevant entity for a member of the LNG project;

(d)the volume of LNG sold in the royalty return period by all members of the LNG project of which the petroleum producer is a member to a person who is a member of the LNG project or a relevant entity for a member of the LNG project;

(e)any other matter the revenue commissioner considers relevant.

(11)The revenue commissioner must give a petroleum producer notice of a decision under subsection (1)(d).

(12)The decision takes effect on the day stated in the notice.

(13)For subsection (12), the day stated in the notice may be a day before the day on which the revenue commissioner makes the decision.

s 148I prev s 148I ins 2010 SL No. 1 s 4

sub 2016 SL No. 25 s 16

om 2020 Act No. 30 s 94

pres s 148I ins 2020 Act No. 30 s 97

ch 6 pt 3 div 5 hdg ins 2020 Act No. 30 s 97

148J Definitions for division

In this division—

average sales price, for liquid petroleum for a petroleum producer for a royalty return period, see sections 148L and 148M.

benchmark price, for liquid petroleum for a royalty return period, is the average, for the royalty return period, of the daily Europe Brent Spot Price FOB (Dollars per Barrel) converted into Australian dollars at the average hedge settlement rate for the royalty return period.

s 148J prev s 148J ins 2010 SL No. 1 s 4

sub 2016 SL No. 25 s 16

amd 2019 Act No. 20 s 59

om 2020 Act No. 30 s 94

pres s 148J ins 2020 Act No. 30 s 97

148K Petroleum royalty for liquid petroleum

If petroleum produced by a petroleum producer in a royalty return period is liquid petroleum, the producer must pay petroleum royalty for the period on the volume of liquid petroleum produced in the period at the following rate—

(a)if the average sales price for liquid petroleum for the producer for the period is not more than $50 per barrel—0.03 cents per barrel for each 1 cent per barrel more than $0 per barrel;

(b)if the average sales price for liquid petroleum for the producer for the period is more than $50, but not more than $100, per barrel—$1.50 per barrel plus 0.115 cents per barrel for each 1 cent per barrel more than $50 per barrel;

(c)if the average sales price for liquid petroleum for the producer for the period is more than $100 per barrel—$7.25 per barrel plus 0.125 cents per barrel for each 1 cent per barrel more than $100 per barrel.

s 148K prev s 148K ins 2016 SL No. 25 s 16

om 2020 Act No. 30 s 94

pres s 148K ins 2020 Act No. 30 s 97

148L What is the average sales price for liquid petroleum

(1)The average sales price for liquid petroleum for a petroleum producer for a royalty return period is worked out using the following formula—

      where—

ASP is the average sales price.

AR is the total revenue from all oil sold in the period, either directly by the producer or indirectly by the producer through 1 or more resellers for the producer, to an independent buyer.

AV is the total volume of all oil sold in the period, either directly by the producer or indirectly by the producer through 1 or more resellers for the producer, to an independent buyer.

DS is the deemed sales value of all oil sold in the period, either directly by the producer or indirectly by the producer through 1 or more resellers for the producer, to a person other than an independent buyer.

DV is the total volume of all oil sold in the period, either directly by the producer or indirectly by the producer through 1 or more resellers for the producer, to a person other than an independent buyer.

(2)For subsection (1), the deemed sales value of all oil sold in the royalty return period, either directly by the producer or indirectly by the producer through 1 or more resellers for the producer, to a person other than an independent buyer is worked out using the following formula—

      where—

DS is the deemed sales value.

BP is the benchmark price for liquid petroleum for the royalty return period.

DV is the total volume of all oil sold in the royalty return period, either directly by the producer or indirectly by the producer through 1 or more resellers for the producer, to a person other than an independent buyer.

s 148L prev s 148L ins 2016 SL No. 25 s 16

om 2020 Act No. 30 s 94

pres s 148L ins 2020 Act No. 30 s 97

148M When average sales price is the benchmark price

(1)This section applies in relation to liquid petroleum produced by a petroleum producer in a royalty return period if—

(a)an election made by the producer under subsection (3) is in effect; or

(b)the producer does not provide, for an assessment, the information required to work out, under section 148L, the average sales price for liquid petroleum for the producer for the period; or

(c)no oil is sold in the period, either directly by the producer or indirectly by the producer through 1 or more resellers for the producer, to an independent buyer; or

(d)the revenue commissioner considers it is appropriate for the protection of the public revenue for subsection (2) to apply.

(2)Despite section 148L, the average sales price for liquid petroleum for the petroleum producer for the royalty return period is the benchmark price for liquid petroleum for the period.

(3)A petroleum producer may make an election in a royalty return lodged by the producer for subsection (2) to apply.

(4)An election made by a petroleum producer under subsection (3)—

(a)starts on the first day of the royalty return period for the royalty return in which the election is made; and

(b)continues in effect for each royalty return period after the royalty return period mentioned in paragraph (a) unless the revenue commissioner ends the election under subsection (6).

(5)A petroleum producer may apply to the revenue commissioner in the approved form to end an election made under subsection (3).

(6)The revenue commissioner may decide to end the election only if the revenue commissioner considers ending the election is appropriate having regard to all of the circumstances, including, for example, the protection of the public revenue.

(7)The revenue commissioner must give the petroleum producer notice of a decision under subsection (6).

(8)The election ends on the day stated in the notice.

(9)For subsection (8), the day stated in the notice may be a day before the day on which the petroleum producer made the application under subsection (5) to end the election.

(10)In making a decision under subsection (1)(d), the revenue commissioner may have regard to any of the following matters—

(a)any arrangements existing between the petroleum producer, or 1 or more resellers for the producer, and a person who purchases liquid petroleum from the producer or reseller;

(b)the number of sales in the royalty return period of liquid petroleum produced by the petroleum producer;

(c)the volume of liquid petroleum produced by the petroleum producer in the royalty return period that is sold to an independent buyer;

(d)the volume of liquid petroleum produced by the petroleum producer in the royalty return period that is sold to a person other than an independent buyer;

(e)any other matter the revenue commissioner considers relevant.

(11)The revenue commissioner must give a petroleum producer notice of a decision under subsection (1)(d).

(12)The decision takes effect on the day stated in the notice.

(13)For subsection (12), the day stated in the notice may be a day before the day on which the revenue commissioner makes the decision.

s 148M prev s 148M ins 2016 SL No. 25 s 16

om 2020 Act No. 30 s 94

pres s 148M ins 2020 Act No. 30 s 97

ch 6 pt 4 hdg ins 2020 Act No. 30 s 97

148N Purpose of part

For section 592A of the Act, this part prescribes the requirements for royalty returns lodged under the Act.

s 148N ins 2020 Act No. 30 s 97

148O Lodgement with revenue commissioner

A royalty return must be lodged with the revenue commissioner.

s 148O ins 2020 Act No. 30 s 97

148P Form of royalty returns

A royalty return lodged under the Act must be in the approved form.

s 148P ins 2020 Act No. 30 s 97

148Q Period to which royalty return must relate

(1)A royalty return required under the Act to be lodged by a petroleum producer must relate to a period of—

(a)if the petroleum producer holds a petroleum lease or a 1923 Act lease—a calendar quarter; or

(b)otherwise—a financial year.

(2)However, if the revenue commissioner considers it appropriate having regard to the amount of the petroleum royalty likely to be payable by the petroleum producer, the revenue commissioner may decide that—

(a)for a petroleum producer to whom subsection (1)(a) applies—a royalty return must relate to a financial year; or

(b)for a petroleum producer to whom subsection (1)(b) applies—a royalty return must relate to a calendar quarter.

(3)A petroleum producer may ask the revenue commissioner to make a decision under subsection (2)(b).

(4)If the revenue commissioner makes a decision under subsection (2)(a) or (b) or (3)—

(a)the revenue commissioner must give notice of the decision to the petroleum producer required to lodge the return; and

(b)the notice must state the day on which the decision is to take effect; and

(c)for subsection (2)(b) or (3)—the day stated in the notice must not be earlier than the day the revenue commissioner gives the petroleum producer the notice unless the person agrees otherwise.

(5)The decision takes effect on the day stated in the notice.

s 148Q ins 2020 Act No. 30 s 97

148R When royalty return must be lodged

(1)A royalty return required under the Act to be lodged by a petroleum producer that relates to a financial year must be lodged within 3 months after the day the year ends.

(2)A royalty return required under the Act to be lodged by a petroleum producer that relates to a calendar quarter must be lodged on or before the last business day of the month after the day the quarter ends.

(3)This section applies subject to section 148S.

s 148R ins 2020 Act No. 30 s 97

148S Revenue commissioner may require royalty return to be lodged on particular day

(1)This section applies if the revenue commissioner considers that, for the protection of the public revenue, a royalty return should be lodged on a day that is earlier than the day mentioned in section 148R(1) or (2).

(2)The revenue commissioner may, by notice, require the petroleum producer required to lodge the royalty return to lodge it on a stated day that is at least 7 days after the day the revenue commissioner gives the petroleum producer the notice.

s 148S ins 2020 Act No. 30 s 97

148T Fee for failing to lodge royalty return on time

(1)If a petroleum producer is required to lodge a royalty return and does not lodge the return by the day it is required to be lodged, the petroleum producer must pay the prescribed fee.

(2)The prescribed fee is $203.25.

(3)For the Taxation Administration Act 2001, section 30(1)(d), the time by which the prescribed fee is payable is the day the assessment is made of the petroleum royalty payable for the period to which the return relates.

(4)The revenue commissioner may remit the whole or part of the fee.

(5)The remission must be made by assessment under the Taxation Administration Act 2001.

s 148T ins 2020 Act No. 30 s 97

ch 6 pt 5 hdg ins 2020 Act No. 30 s 97

148U When petroleum royalty payable—yearly return period

For the Taxation Administration Act 2001, section 30(1), the petroleum royalty payable by a petroleum producer under the Act for a royalty return period that is a financial year is payable on the day the royalty return must be lodged for the royalty return period.

s 148U ins 2020 Act No. 30 s 97

148V When petroleum royalty payable— return period that is calendar quarter

(1)Subject to section 148W, the petroleum royalty payable by a petroleum producer under the Act for a royalty return period that is a calendar quarter is payable as follows—

(a)instalment 1 is payable on the last business day of the second month of the royalty return period;

(b)instalment 2 is payable on the last business day of the third month of the royalty return period;

(c)under the Taxation Administration Act 2001, section 30(1)(a), instalment 3 is payable on the day a royalty return must be lodged for the royalty return period.

(2)A petroleum producer must lodge an approved form for a payment under subsection (1) when the payment is made.

(3)In this section—

instalment 1, for a royalty return period that is a calendar quarter, means—

(a)the amount payable by the petroleum producer for the first month of the royalty return period worked out under section 148X; or

(b)if an election under section 148Z applies for the first month of the royalty return period—the amount payable by the petroleum producer for the first month worked out under section 148Z(5)(a).

instalment 2, for a royalty return period that is a calendar quarter, means—

(a)the amount payable by the petroleum producer for the second month of the royalty return period worked out under section 148X; or

(b)if an election under section 148Z applies for the second month of the royalty return period—the amount payable by the petroleum producer for the second month worked out under section 148Z(5)(b).

instalment 3, for a royalty return period that is a calendar quarter, means—

(a)

if the sum of instalment 1 and instalment 2 for the royalty return period is less than the petroleum royalty payable by the petroleum producer under the Act for the royalty return period (the total royalty)—the amount of the total royalty less the sum; or

(b)otherwise—zero.

s 148V ins 2020 Act No. 30 s 97

148W Quarterly payment notice

(1)If the revenue commissioner considers it appropriate, the revenue commissioner may, by notice (a quarterly payment notice) given to a petroleum producer, state that the day petroleum royalty is payable by the petroleum producer for a royalty return period that is a calendar quarter is the day the royalty return must be lodged for the period instead of an earlier time under section 148V(1)(a) or (b).

(2)A quarterly payment notice given to a petroleum producer must state the period for which the notice applies.

(3)If the revenue commissioner considers it appropriate to do so, the revenue commissioner may, by notice, withdraw a quarterly payment notice.

(4)A withdrawal under subsection (3) takes effect from the start of the next royalty return period after the end of the royalty return period in which the notice of the withdrawal is given.

s 148W ins 2020 Act No. 30 s 97

148X Working out monthly payments for return period that is calendar quarter generally

(1)This section provides, for section 148V(1), the amounts payable by a petroleum producer for the first and second months of a royalty return period (the current royalty return period).

Note—

See, however, section 148Z.

(2)The amount payable by the petroleum producer for each of the first and second months of the current royalty return period is a third of the total amount of the petroleum royalty payable by the petroleum producer under the Act for the previous royalty return period—

(a)taking into account any assessment under the Taxation Administration Act 2001, for the petroleum royalty payable for the previous royalty return period, made before the earlier of the following events happens—

(i)the amount for the first month of the current royalty return period is paid;

(ii)the amount for the first month of the current royalty return period becomes payable; and

(b)disregarding any assessment under the Taxation Administration Act 2001, for the petroleum royalty payable for the previous royalty return period, made when, or after, the earlier of the events mentioned in paragraph (a)(i) and (ii) happens.

Example—

The petroleum royalty paid for the previous royalty return period was $90,000. A reassessment for the previous royalty return period was made by the revenue commissioner under the Taxation Administration Act 2001 to increase the petroleum royalty payable for the previous royalty return period to $120,000. The reassessment was made before the amount payable for the first month of the royalty return period is paid or becomes payable (whichever is the earlier). Accordingly, the amount payable under this section for the first month and second month of the royalty return period is $40,000 (being a third of $120,000).

s 148X ins 2020 Act No. 30 s 97

148Y Working out monthly payments for return period that is calendar quarter in particular circumstances

(1)This section applies if—

(a)an amount is payable by a petroleum producer under section 148X(2) for the first and second months of a royalty return period (the current royalty return period); and

(b)either—

(i)the petroleum producer did not lodge a royalty return for the previous royalty return period, as required under the Act; or

(ii)the previous royalty return period was not a calendar quarter.

(2)For working out the amounts payable by the petroleum producer under section 148X(2)—

(a)the revenue commissioner may—

(i)if subsection (1)(b)(i) applies—estimate the total amount of petroleum royalty payable by the petroleum producer under the Act for the previous royalty return period; or

(ii)if subsection (1)(b)(ii) applies—adjust the amount of petroleum royalty payable by the petroleum producer under the Act for the previous royalty return period to estimate an amount representative of the petroleum royalty that would have been payable if the previous royalty return period were a calendar quarter; and

(b)the revenue commissioner must give the petroleum producer a notice stating the amount (the estimated amount) estimated by the revenue commissioner under paragraph (a)(i) or (ii); and

(c)the estimated amount is the total amount of petroleum royalty payable by the petroleum producer under the Act for the previous royalty return period.

(3)In estimating an amount for subsection (2)(a)(i) or (ii), the revenue commissioner may have regard to—

(a)any other royalty returns lodged by the petroleum producer; and

(b)the volume of petroleum for which the petroleum royalty is payable; and

(c)any other relevant matter.

s 148Y ins 2020 Act No. 30 s 97

148Z Election to change monthly payments for return period that is calendar quarter

(1)This section applies if, at the relevant time—

(a)a petroleum producer reasonably believes the amount of petroleum royalty payable by the producer under the Act for a royalty return period that is a calendar quarter (the current royalty return period) will be less than the petroleum royalty payable by the producer under the Act for the previous royalty return period; and

(b)the revenue commissioner has not given the petroleum producer a notice under section 148ZA.

(2)For subsection (1), the petroleum royalty payable by the petroleum producer under the Act for the previous royalty return period is the amount that, under section 148X or 148Y, is the petroleum royalty payable by the producer under the Act for the previous royalty return period for section 148X(2).

(3)The petroleum producer may elect to change the amount payable for the first or second months of the current royalty return period.

(4)The election must—

(a)be in the approved form; and

(b)state the amount of petroleum royalty the petroleum producer reasonably believes will be payable by the petroleum producer under the Act for the current royalty return period; and

(c)unless the revenue commissioner, by notice given to the petroleum producer, approves another day for making the election—be lodged on or before—

(i)for an election for the first month of the current royalty return period—the last business day of the second month of the royalty return period; or

(ii)for an election for the second month of the current royalty return period—the last business day of the third month of the royalty return period.

(5)Subject to subsection (6)—

(a)if the petroleum producer makes an election under subsection (3) for the first month of the current royalty return period, the amount payable for that month is a third of the amount mentioned in subsection (4)(b) for the election; or

(b)if the petroleum producer makes an election under subsection (3) for the second month of the current royalty return period, the amount payable for that month is a third of the amount mentioned in subsection (4)(b) for the election.

(6)The amount payable, as changed under subsection (3) for the first or second months of a royalty return period, may be more than the amount payable under subsection (5)(a) or (5)(b).

(7)In this section—

relevant time, for an election for the first month or the second month of a royalty return period, means when the amount payable for the month becomes payable under section 148V.

s 148Z ins 2020 Act No. 30 s 97

148ZA Revenue commissioner may give notice requiring petroleum royalty payable to be worked out under s 148X

(1)This section applies if—

(a)a petroleum producer has previously made an election under section 148Z(3); and

(b)the revenue commissioner considers the petroleum producer did not have a reasonable basis for forming the belief mentioned in section 148Z(1)(a) for the election.

(2)The revenue commissioner may give the petroleum producer a notice stating that the amounts payable by the petroleum producer for the first and second months of 1 or more royalty return periods must be worked out under section 148X.

(3)The petroleum producer may not make an election under section 148Z(3) for a royalty return period to which the notice relates.

s 148ZA ins 2020 Act No. 30 s 97

ch 6 pt 6 hdg ins 2020 Act No. 30 s 97

148ZB Definitions for part

In this part—

amount, of petroleum produced under a joint venture tenure, includes a percentage or proportion of petroleum produced under the tenure.

election period, for a joint venture tenure, means the period for which a non-tenure holder is taken to be a petroleum producer, in relation to an amount of petroleum produced under the joint venture tenure, for a royalty provision.

joint venture tenure see section 148ZC(1)(b).

non-tenure holder see section 148ZC(1)(a).

tenure holder see section 148ZC(1)(b).

s 148ZB ins 2020 Act No. 30 s 97

148ZC Non-tenure holder may apply to be treated as petroleum producer for joint venture tenure

(1)This section applies if—

(a)a person (the non-tenure holder) is a participant in a joint venture, or other arrangement, involving the production of petroleum and does not hold a petroleum tenure under which the petroleum for the joint venture or other arrangement is produced; and

(b)another person (the tenure holder) holds a petroleum tenure under which the petroleum for the joint venture or other arrangement is produced (the joint venture tenure).

(2)The non-tenure holder may apply to the revenue commissioner to be taken to be a petroleum producer, in relation to a stated amount of petroleum produced under the joint venture tenure, for a royalty provision.

(3)The application must—

(a)be in the approved form; and

(b)identify the joint venture tenure; and

(c)state the proposed amount of petroleum produced under the joint venture tenure for which the non-tenure holder is to be taken to be a petroleum producer for a royalty provision; and

(d)state the proposed day for the election period for the joint venture tenure to start; and

(e)state either—

(i)the proposed day for the election period for the joint venture tenure to end; or

(ii)that the election period for the joint venture tenure is to end under section 148ZD; and

(f)be accompanied by the consent to the application of the tenure holder.

(4)The revenue commissioner must decide the application by—

(a)granting the application in the way proposed; or

(b)granting the application in another way, with the written agreement of the non-tenure holder and tenure holder; or

(c)refusing to grant the application.

(5)The revenue commissioner may grant the application only if the revenue commissioner is satisfied the decision would not adversely affect the protection of the public revenue.

(6)The election period must not—

(a)start on a day earlier than the first day of the current royalty return period; or

(b)if a day is stated under subsection (3)(e)(i)—end on a day later than the stated day.

(7)The revenue commissioner must give the non-tenure holder and the tenure holder notice of the decision.

(8)If the decision is to refuse to grant the application, the notice must include reasons for the decision.

(9)If the revenue commissioner decides to grant the application, for the election period for the joint venture tenure—

(a)the non-tenure holder is taken to produce the amount of petroleum produced under the joint venture tenure that is decided by the revenue commissioner; and

(b)the non-tenure holder is taken to be a petroleum producer, in relation to the amount of petroleum mentioned in paragraph (a), for a royalty provision; and

(c)the non-tenure holder is taken to be a taxpayer under the Taxation Administration Act 2001 in relation to petroleum royalty payable on the amount of petroleum mentioned in paragraph (a); and

(d)a provision relating to when a royalty return is required to be lodged is taken to apply to the non-tenure holder as if the non-tenure holder held the joint venture tenure; and

(e)sections 591 and 591A of the Act are taken to apply, in relation to the amount of petroleum mentioned in paragraph (a), as if the non-tenure holder held the joint venture tenure.

(10)This section does not affect the tenure holder’s liability to pay petroleum royalty on the amount of petroleum mentioned in subsection (9)(a) if the non-tenure holder does not pay the royalty.

(11)In this section—

current royalty return period means the royalty return period applying in relation to the joint venture tenure on the day the application under this section is made.

s 148ZC ins 2020 Act No. 30 s 97

148ZD Ending of election period on application or by revenue commissioner

(1)This section applies if the revenue commissioner has approved an application in relation to a joint venture tenure under section 148ZC.

(2)The non-tenure holder or tenure holder for the joint venture tenure may apply to the revenue commissioner to end the election period for the joint venture tenure.

(3)The application must—

(a)be in the approved form; and

(b)state the proposed day for the election period for the joint venture tenure to end; and

(c)if the application is made by the non-tenure holder—be accompanied by evidence that the non-tenure holder has notified the tenure holder of the application; and

(d)if the application is made by the tenure holder—be accompanied by evidence that the tenure holder has notified the non-tenure holder of the application.

(4)The revenue commissioner must decide the application by—

(a)ending the election period on the day proposed; or

(b)ending the election period on another day, with the written agreement of the non-tenure holder and tenure holder; or

(c)refusing to end the election period.

(5)The revenue commissioner must decide to end the election period if the revenue commissioner is satisfied that ending the election period would not adversely affect the protection of the public revenue.

(6)The revenue commissioner may also decide, on the revenue commissioner’s own initiative, to end the election period for the joint venture tenure if the revenue commissioner is satisfied that ending the election period is appropriate for the protection of the public revenue.

(7)The day on which the election period ends must not be earlier than the first day of the current royalty return period.

(8)The revenue commissioner must give the non-tenure holder and the tenure holder notice of a decision under subsection (4) or (6).

(9)If the decision is under subsection (6), the notice must include reasons for the decision.

(10)To remove any doubt, it is declared that the ending of the election period for the joint venture tenure does not affect a liability arising before the ending of the period.

(11)In this section—

current royalty return period means—

(a)for an application under subsection (2)—the royalty return period applying in relation to the joint venture tenure on the day the application is made; or

(b)for a decision under subsection (6)—the royalty return period applying in relation to the joint venture tenure on the day the decision is made.

s 148ZD ins 2020 Act No. 30 s 97

ch 6 pt 7 hdg ins 2020 Act No. 30 s 97

149 Application of chapter to swap arrangements

(1)The revenue commissioner may make a determination about how this chapter applies to swap arrangements.

(2)Without limiting subsection (1), for petroleum subject to a swap arrangement, a determination may be made about—

(a)how the average sales price for the petroleum is to be worked out for part 3; and

(b)if the petroleum is gas—whether the gas is to be classified as domestic gas, supply gas or project gas.

(3)The revenue commissioner must publish a determination made under subsection (1) on the department’s website.

(4)In this section—

swap arrangement means an arrangement entered into between petroleum producers to swap rights or obligations in relation to petroleum produced by the producers to the extent the arrangement relates to exchanging the same volume and quality of petroleum in a particular period.

s 149 prev s 149 amd 2008 SL No. 158 s 17; 2011 Act No. 16 s 36; 2011 SL No. 295 s 14; 2014 SL No. 123 s 27; 2019 Act No. 20 s 60

om 2020 Act No. 30 s 94

pres s 149 ins 2020 Act No. 30 s 97

ch 6 pt 8 hdg prev ch 6 pt 2 div 4 hdg ins 2011 SL No. 32 s 6

pres ch 6 pt 8 hdg (prev ch 6 pt 2 div 4 sdiv 4 hdg) renum 2020 Act No. 30 s 96

149APurpose of part

This part prescribes for section 593(2) of the Act the requirements for royalty estimates.

s 149A ins 2011 SL No. 32 s 6

amd 2020 Act No. 30 s 98

149BWhat notice must contain

(1)The notice given by the revenue commissioner to a petroleum producer under section 593 of the Act (a royalty estimate notice) must include the following—

(a)the period (the estimate period) for which the petroleum producer is to estimate the royalties payable by the petroleum producer under section 590 of the Act;

(b)the day by which the petroleum producer must provide the royalty estimate;

(c)the form in which the petroleum producer must provide the royalty estimate;

(d)a description of the information the petroleum producer must provide in the royalty estimate.

(2)For subsection (1)(d), the information the revenue commissioner may ask a petroleum producer to provide in the royalty estimate includes the following—

(a)a statement of each type of petroleum the producer expects to produce in the estimate period;

(b)for each type of petroleum stated under paragraph (a), an estimate of the following for the estimate period—

(i)the volume of petroleum the producer expects to produce;

(ii)the volume of petroleum the producer expects to be exempt from petroleum royalty under section 591 or 591A of the Act;

(iii)the volume of petroleum the producer expects to be subject to the benchmark price for the petroleum;

(iv)the average sales price for the petroleum for the petroleum producer for the estimate period.

(3)Subsection (2) does not limit the information the revenue commissioner may ask to be included in the royalty estimate.

(4)In this section—

type, of petroleum, means—

(a)domestic gas; or

(b)supply gas; or

(c)project gas; or

(d)liquid petroleum.

s 149B ins 2011 SL No. 32 s 6

amd 2020 Act No. 30 s 99

149CForm of and information to be included in royalty estimate

The royalty estimate must—

(a)be in the form stated in the royalty estimate notice; and

(b)include the information asked for in the royalty estimate notice.

s 149C ins 2011 SL No. 32 s 6

149DRevenue commissioner may request information to support royalty estimate

(1)The revenue commissioner may, by notice to a petroleum producer who has lodged a royalty estimate, ask the petroleum producer to give the revenue commissioner, by the day stated in the notice, information to support the matters stated in the royalty estimate.

(2)The revenue commissioner may, by notice to a petroleum producer who must provide a royalty estimate under section 593(2) of the Act, ask the petroleum producer to give the revenue commissioner, by the day stated in the notice, additional information about the matters that must be included in the royalty estimate.

(3)If the revenue commissioner asks a petroleum producer for information under subsection (1) or (2), the petroleum producer must provide the information by the day stated in the notice.

s 149D ins 2011 SL No. 32 s 6

amd 2020 Act No. 30 s 100

ch 6 pt 9 hdg prev ch 6 pt 2 div 4 hdg ins 2012 SL No. 169 s 18

pres ch 6 pt 9 hdg (prev ch 6 pt 2 div 4 sdiv 4A hdg) renum 2020 Act No. 30 s 96

149EImposition of civil penalty—Act, s 594

(1)This section applies if a petroleum producer makes a section 148Z election and either—

(a)the petroleum royalty payable for the current royalty return period exceeds the petroleum royalty payable for the previous royalty return period by an amount that is more than 15% of the petroleum royalty payable for the previous royalty return period; or

(b)both of the following apply—

(i)the petroleum royalty payable for the current royalty return period is less than the petroleum royalty payable for the previous royalty return period;

(ii)the total of the petroleum royalty payable for the first month and the second month of the current royalty return period is less than 50% of the total petroleum royalty payable for the current royalty return period.

(2)The producer is liable to the State for an amount (civil penalty) equal to 25% of the default estimate difference, if any, for each month of the current royalty return period for which the producer makes the section 148Z election.

(3)For subsection (2), the default estimate difference for a month of the current royalty return period is the difference between—

(a)the amount that would have been payable for the month under section 148X if the producer had not made the section 148Z election; and

(b)the amount payable for the month under the section 148Z election.

(4)However, if the amount mentioned in subsection (3)(a) is less than the amount mentioned in subsection (3)(b), the default estimate difference for the month is taken to be 0.

(5)Subsection (6) applies if, for petroleum royalty payable for the current royalty return period, an assessment is made under the Taxation Administration Act 2001.

(6)For subsection (1), the petroleum royalty payable for the current royalty return period is the amount of petroleum royalty payable taking into account the assessment.

(7)For subsection (1), a reference to the petroleum royalty payable for the previous royalty return period is a reference to the amount worked out under section 148Z(2).

(8)The revenue commissioner may remit the whole or part of the civil penalty.

(9)The remission must be made by assessment.

(10)In this section—

current royalty return period see section 148Z(1)(a).

section 148Z election means an election under section 148Z(3) to change the amount payable for the first month or the second month, or both, of the current royalty return period.

s 149E ins 2012 SL No. 169 s 18

amd 2014 SL No. 123 s 28; 2020 Act No. 30 s 101

ch 6 pt 10 hdg prev ch 6 pt 2 div 4 hdg ins 2012 SL No. 169 s 18

amd 2020 Act No. 30 s 95

pres ch 6 pt 10 hdg (prev ch 6 pt 2 div 4 sdiv 4B hdg) renum 2020 Act No. 30 s 96

149I Unpaid tax interest on petroleum royalty—Taxation Administration Act 2001, s 54

(1)For the Taxation Administration Act 2001, section 54(9), this section provides for working out the period for which unpaid tax interest accrues if—

(a)petroleum royalty is payable by a person under section 148V(1) for a royalty return period that is a calendar quarter; and

(b)the person has not paid all of the amount payable for instalment 1, instalment 2 or instalment 3 as required under section 148V.

(2)If instalment 1 or instalment 2 is not paid in full by the day required under section 148V, unpaid tax interest accrues on the amount unpaid, from time to time, for the period—

(a)starting on, and including, the day after the day the instalment is required to be paid; and

(b)ending on, and including, the earlier of the following days—

(i)the day the instalment is paid in full;

(ii)the lodgement day.

(3)If the petroleum royalty payable for the royalty return period is not paid in full on the lodgement day, unpaid tax interest accrues on the total amount unpaid, from time to time, for the period—

(a)starting on, and including, the day after the lodgement day; and

(b)ending on, and including, the day the total amount is paid in full.

(4)In this section—

lodgement day means the day a petroleum royalty return must be lodged for a royalty return period, disregarding any extension given under the Taxation Administration Act 2001, section 151.

s 149I ins 2012 SL No. 169 s 18

sub 2020 Act No. 30 s 103

Note—

Some provisions referred to in this chapter were repealed by the Petroleum and Gas (Production and Safety) and Other Legislation Amendment Regulation 2017 or the Petroleum and Gas (Safety) Regulation 2018.

ch 7 note ins 2018 SL No. 135 s 198

ch 7 pt 1 hdg sub 2007 SL No. 312 s 43

ch 7 pt 1 div 1 hdg ins 2007 SL No. 312 s 43

156Definitions for div 1

In this division—

chief gas examiner means the chief gas examiner under the repealed Gas (Residual Provisions) Act 1965.

commencement means the commencement of section 860 of the Act.

existing, for an approval or certificate given under the repealed regulation, means an approval or certificate that is in effect immediately before the commencement.

repealed regulation means the repealed Gas (Residual Provisions) Regulation 1989.

s 156 amd 2007 SL No. 312 s 44

157Approval for non-conforming gas

An existing approval given by the chief gas examiner under section 21 of the repealed regulation is, on the commencement, taken to be a gas quality approval given by the chief inspector under section 622 of the Act.

158Approval of gas devices etc.

(1)An existing approval for an appliance, container, fitting or system given by an approval body under section 81 of the repealed regulation is taken to be an approval given by the chief inspector, or a person or body approved by the chief inspector, under section 733(1) of the Act.

(2)In this section—

approval body means—

(a)the chief gas examiner; or

(b)a person or body approved by the chief gas examiner under section 81 of the repealed regulation.

s 158 amd 2010 SL No. 116 s 40

159Continuing effect of certificates of compliance

(1)An existing certificate of compliance under section 99 of the repealed regulation continues, on the commencement, to have effect as a gas inspection certificate under chapter 5, part 3.

(2)A certificate mentioned in section 109(2A)(b) of the repealed regulation given by a licensed person is, on the commencement, taken to be a certification given under section 734(3) of the Act.

(3)A certificate mentioned in section 110(2), 111(2) or 112(2) of the repealed regulation given by a licensed person continues, on the commencement, to have effect as a gas inspection certificate under chapter 5, part 3.

(4)In this section—

licensed person means a licensed person under the repealed regulation.

s 159 amd 2007 SL No. 312 s 45

160Approval of plans and specifications for particular installations

(1)An existing approval given by the chief gas examiner under section 100(2) of the repealed regulation continues, on the commencement, to have effect.

(2)The installation to which the approval relates is not required to comply with a safety requirement to the extent that the approval relates to an aspect of the plans and specifications for the installation that does not comply with the safety requirement.

(3)However, subsection (2) no longer applies if—

(a)the installation is modified so that it no longer complies with the approved plans and specifications; or

(b)the plans and specifications that were approved are modified.

161Effect of existing approval of vessel’s gas system

(1)This section applies if the plans and specifications for a gas fuel system used for the propulsion of a vessel were approved under section 105 of the repealed regulation.

(2)For section 104, the plans and specifications of the vessel’s gas system are taken to have been approved by an inspector.

162Continuing effect of exemption

(1)This section applies if—

(a)an existing exemption was given by the chief gas examiner under section 122 of the repealed regulation; and

(b)the exemption related to a requirement under the repealed regulation for which there is a corresponding requirement under this regulation.

(2)On the commencement, the exemption continues to have effect for the purpose of the corresponding requirement.

(3)However—

(a)the chief inspector may cancel the exemption at any time by giving notice to the holder of the exemption; and

(b)section 122(3) of the repealed regulation continues in force in relation to the exemption.

ch 7 pt 1 div 2 hdg (prev ch 7 pt 2 hdg) renum 2007 SL No. 312 s 46

163Continued application of Petroleum Act 1923 in relation to drilling of particular wells

(1)Sections 57 and 68 do not apply in relation to a prescribed well—

(a)that was drilled before the commencement; or

(b)if drilling of the well starts before 1 July 2005.

(2)If sections 57 and 68 do not apply in relation to a prescribed well, the drilling of the well must comply with all relevant requirements under the 1923 Act, as it was before the commencement.

164Audit and inspection fee for 2004–2005 financial year

The audit and inspection fee payable by a liable person for the financial year starting on 1 July 2004 is the amount that is one-half of the fee for the year provided for under chapter 6, part 2, division 2.

ch 7 pt 2 hdg ins 2007 SL No. 312 s 47

165Person not required to give notice about use of preferred standard for existing activity or thing

Section 7(4)(b)(i) does not apply to a person, who immediately before commencement of this section, was required to comply with a safety requirement that was a preferred standard under section 7(2) and schedule 1 for an activity or thing.

s 165 ins 2007 SL No. 312 s 47

166Application of provision about competency requirements for drilling rig workers

Section 54AA does not apply to the operator of a drilling operating plant until 1 January 2009.

s 166 ins 2007 SL No. 312 s 47

ch 7 pt 3 hdg ins 2008 SL No. 158 s 18

167Payment of annual rent for a particular period

(1)This section applies to annual rent for an authority that would have been payable on or before 30 August 2008 under the unamended provision.

(2)The proportion of the annual rent relating to the period from the day the annual rent would have been payable under the unamended provision to 31 August 2008, is payable on or before 31 August 2008 with the annual rent for the authority payable on that day under section 145, as amended by the Mines and Energy Legislation Amendment Regulation (No. 2) 2008.

(3)In this section—

unamended provision means section 145(3)(b) as in force immediately before the commencement of this section.

s 167 ins 2008 SL No. 158 s 18