Petroleum Act 1998

Repayments for development.

Notes:

Rights transferred without the consent of appropriate authority

Repayments for development.

Power to inspect plans of mines.

Supplementary.

Notes:

Supplementary.

Application of civil law.

Interpretation of Part II.

PART 1A — Maximising economic recovery of UK petroleum

9A

• (1) In this Part the “principal objective” is the objective of maximising the economic recovery of UK petroleum, in particular through—

• (a) development, construction, deployment and use of equipment used in the petroleum industry (including upstream petroleum infrastructure), and

• (b) collaboration among the following persons—

• (i) holders of petroleum licences;

• (ii) operators under petroleum licences;

• (iii) owners of upstream petroleum infrastructure;

• (iv) persons planning and carrying out the commissioning of upstream petroleum infrastructure.

• (v) owners of relevant offshore installations.

• (2) The OGA must produce one or more strategies for enabling the principal objective to be met.

• (3) A strategy may relate to matters other than those mentioned in subsection (1)(a) and (b).

• (4) For provision about producing and revising a strategy, see sections 9F and 9G.

9B

The OGA must act in accordance with the current strategy or strategies when—

• (a) exercising functions under the other Parts of this Act (except Part 4),

• (b) exercising functions under Part 4 ... ,

• (c) exercising functions under Chapter 3 of Part 2 of the Energy Act 2011 (upstream petroleum infrastructure),

• (ca) exercising functions under Part 2 of the Energy Act 2016,

• (d) exercising any function or using any power under a petroleum licence, and

• (e) exercising any other function or using any power—

• (i) to provide advice or assistance to another person, or

• (ii) to acquire, use or supply information,

for the purpose of enabling the principal objective to be met.

9C

• (1) A person who is the holder of a petroleum licence must act in accordance with the current strategy or strategies when planning and carrying out activities as the licence holder.

• (2) A person who is an operator under a petroleum licence must act in accordance with the current strategy or strategies when planning and carrying out activities as the operator under the licence.

• (3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (4) A person must act in accordance with the current strategy or strategies when planning and carrying out the commissioning of upstream petroleum infrastructure.

• (5) A person who is the owner of—

• (a) a relevant offshore installation, or

• (b) upstream petroleum infrastructure,

must act in accordance with the current strategy or strategies when planning and carrying out the activities mentioned in subsection (6).

• (6) Those activities are—

• (a) the person's activities as the owner of the installation or infrastructure (including the development, construction, deployment and use of the infrastructure or installation);

• (b) the abandonment or decommissioning of the installation or infrastructure.

• (7) For the purposes of subsection (5), planning the activities mentioned in subsection (6)(b) includes the preliminary stage of—

• (a) deciding whether or when to proceed with the proposed abandonment or decommissioning, and

• (b) considering alternative measures to abandonment or decommissioning such as re-use or preservation.

9D

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

9E

• (1) This Part does not limit the exercise of the OGA's security and resilience functions.

• (2) This Part is subject to the exercise of the security and resilience functions by the OGA.

• (3) In this section “security and resilience function” means any function which relates to—

• (a) the security of petroleum supplies, or

• (b) the resilience of the petroleum industry.

9F

• (1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (2) After the first strategy has been produced, the OGA may—

• (a) produce a new strategy, or

• (b) revise a current strategy,

whenever the OGA thinks appropriate.

• (3) The OGA must review each current strategy before the end of each relevant four year period.

• (4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (5) In this section “relevant four year period”, in relation to a current strategy, means a period of four years beginning with—

• (a) the date on which the strategy was issued, or

• (b) if later, the date on which the last review under subsection (3) was concluded.

9G

• (1) Before—

• (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (b) producing a new strategy, or

• (c) revising a current strategy,

the OGA must prepare a draft of the strategy or revised strategy.

• (2) The OGA must—

• (a) consult such persons as the OGA thinks appropriate about the draft, and

• (b) consider any representations made by them.

• (3) If, after complying with that duty, the OGA decides to proceed with the draft (in its original form or with modifications), the OGA must send the draft to the Secretary of State.

• (3A) The Secretary of State must either—

• (a) lay a copy of the draft before each House of Parliament, or

• (b) return the draft to the OGA and publish the Secretary of State's reasons for doing so.

• (3B) The Secretary of State may return the draft to the OGA only if the Secretary of State thinks that—

• (a) the OGA has failed to comply with subsection (2), or

• (b) the strategy will not enable the principal objective to be met.

• (4) Where a copy of the draft has been laid in accordance with subsection (3A)(a), the OGA may not take any further steps in relation to the draft if, within the 40 day period, either House resolves not to approve the draft (a “negative resolution”).

• (5) If neither House passes a negative resolution, the OGA may issue the strategy or revised strategy in the form laid before Parliament.

• (6) The strategy or revised strategy comes into force on the date specified by the OGA (which must not be before the date when it is issued).

• (7) Subsection (4) does not prevent a new draft of a strategy or revised strategy from being laid before Parliament.

• (8) In this section “40 day period”, in relation to the draft of a strategy or revised strategy, means the period of 40 days beginning with the day on which the draft is laid before Parliament (or if the draft is not laid before each House on the same day, the later of the 2 days on which it is laid).

• (9) For the purposes of calculating the 40 day period, no account is to be taken of any period during which Parliament is dissolved or prorogued or during which both Houses are adjourned for more than four days.

9H

• (1) In this Part “upstream petroleum infrastructure” means anything that for the purposes of section 82(1) of the Energy Act 2011 is—

• (a) a relevant upstream petroleum pipeline,

• (b) a relevant oil processing facility, or

• (c) a relevant gas processing facility,

if and in so far as it is used in relation to petroleum within subsection (2) (including such petroleum after it has been got).

• (2) Petroleum is within this subsection if it is petroleum which for the time being exists in its natural condition in strata beneath—

• (a) the territorial sea adjacent to Great Britain, or

• (b) the sea in any area designated under section 1(7) of the Continental Shelf Act 1964.

• (3) In this Part “owner”, in relation to upstream petroleum infrastructure, means—

• (a) a person in whom the pipeline or facility is vested;

• (b) a lessee and any person occupying or controlling the pipeline or facility; and

• (c) any person who has the right to have things conveyed by the pipeline or processed by the facility.

9I

In this Part—

• “current strategy”, in relation to any particular time, means a strategy under section 9A(2) in force at that time;

• “offshore installation” has the same meaning as in Part 4 (see section 44);

• “operator under a petroleum licence” means a person who is responsible for organising or supervising any of the operations of searching for, boring for, or getting UK petroleum in pursuance of the petroleum licence;

• “owner”, in relation to a relevant offshore installation, has the meaning given in section 9HA;

• “owner”, in relation to upstream petroleum infrastructure, has the meaning given in section 9H;

• “petroleum” has meaning given in section 1;

• “petroleum licence” means a licence granted under—section 3 of this Act, orsection 2 of the Petroleum (Production) Act 1934;

• “principal objective” has the meaning given in section 9A;

• “relevant offshore installation” has the meaning given in section 9HA;

• “relevant UK waters” means—the territorial sea adjacent to the United Kingdom, andthe sea in any area designated under section 1(7) of the Continental Shelf Act 1964;

• “submarine pipeline” has the meaning given in section 45;

• “UK petroleum” means petroleum which for the time being exists in its natural condition in strata beneath relevant UK waters;

• “upstream petroleum infrastructure” has the meaning given in section 9H.

Section 17D: supplemental.

Notes:

4A

• (1) The OGA must not issue a well consent for a well situated in the English onshore area that is required by an onshore licence for England or Wales unless the well consent imposes—

• (a) a condition which prohibits associated hydraulic fracturing from taking place in land at a depth of less than 1000 metres; and

• (b) a condition which prohibits associated hydraulic fracturing from taking place in land at a depth of 1000 metres or more unless the licensee has the Secretary of State's consent for it to take place (a “hydraulic fracturing consent”).

• (1A) The Welsh Ministers must not issue a well consent for a well situated in the Welsh onshore area that is required by an onshore licence for England or Wales unless the well consent imposes—

• (a) a condition that prohibits associated hydraulic fracturing from taking place in land at a depth of less than 1000 metres; and

• (b) a condition that prohibits associated hydraulic fracturing from taking place in land at a depth of 1000 metres or more unless the licensee has the Welsh Ministers' consent for it to take place (a “hydraulic fracturing consent”).

• (2) A hydraulic fracturing consent is not to be issued unless an application for its issue is made by, or on behalf of, the licensee.

• (3) Where an application is made to the Secretary of State, the Secretary of State may not issue a hydraulic fracturing consent unless the Secretary of State—

• (a) is satisfied that—

• (i) the conditions in column 1 of the following table are met, and

• (ii) the conditions in subsection (6) are met, and

• (b) is otherwise satisfied that it is appropriate to issue the consent.

• (3A) Where an application is made to the Welsh Ministers, the Welsh Ministers may not issue a hydraulic fracturing consent unless—

• (a) they are satisfied that—

• (i) the conditions in column 1 of the following table are met, and

• (ii) the conditions in subsection (6) are met, and

• (b) they are otherwise satisfied that it is appropriate to issue the consent.

• (4) The existence of a document of the kind mentioned in column 2 of the table in this section is sufficient for the Secretary of State or the Welsh Ministers to be satisfied that the condition to which that document relates is met.

• (5) But the absence of such a document does not prevent the Secretary of State or the Welsh Ministers from being satisfied that that condition is met.

Column 1: conditions	Column 1: conditions	Column 2: documents
1	The environmental impact of the development which includes the relevant well has been taken into account by the local planning authority	A notice given by the local planning authority that the environmental information was taken into account in deciding to grant the relevant planning permission
2	Appropriate arrangements have been made for the independent inspection of the integrity of the relevant well	A certificate given by the Health and Safety Executive that it— (a) has received a well notification under regulation 6 of the Borehole Sites and Operations Regulations 1995, (b) has received the information required by regulation 19 of the Offshore Installations and Wells (Design and Construction, etc.) Regulations 1996, and (c) has visited the site of the relevant well
3	The level of methane in groundwater has, or will have, been monitored in the period of 12 months before the associated hydraulic fracturing begins	An environmental permit has been given by the relevant environmental regulator which contains a condition that requires compliance with a waste management plan which provides for monitoring of the level of methane in groundwater in the period of 12 months before the associated hydraulic fracturing begins
4	Appropriate arrangements have been made for the monitoring of emissions of methane into the air	An environmental permit which contains a condition requiring compliance with a waste management plan which provides for the monitoring of emissions of methane into the air for the period of the permit
5	The associated hydraulic fracturing will not take place within protected groundwater source areas	A decision document given by the relevant environmental regulator (in connection with an environmental permit) which indicates that the associated hydraulic fracturing will not take place within protected groundwater source areas
6	The associated hydraulic fracturing will not take place within other protected areas	A notice given by the local planning authority that the area in respect of which the relevant planning permission has been granted does not include any land which is within any other protected areas
7	In considering an application for the relevant planning permission, the local planning authority has (where material) taken into account the cumulative effects of— (a) that application, and (b) other applications relating to exploitation of onshore petroleum obtainable by hydraulic fracturing	A notice given by the local planning authority that it has taken into account those cumulative effects
8	The substances used, or expected to be used, in associated hydraulic fracturing— (a) are approved, or (b) are subject to approval, by the relevant environmental regulator	An environmental permit has been given by the relevant environmental regulator which contains a condition that requires substances used in associated hydraulic fracturing to be approved by that regulator
9	In considering an application for the relevant planning permission, the local planning authority has considered whether to impose a restoration condition in relation to that development	A notice given by the local planning authority that it has considered whether to impose such a condition
10	The relevant undertaker has been consulted before grant of the relevant planning permission	A notice given by the local planning authority that the relevant undertaker has been consulted
11	The public was given notice of the application for the relevant planning permission	A notice given by the local planning authority which confirms that the applicant for the relevant planning permission has certified that public notification requirements, as set out in a development order, have been met

• (6) The conditions mentioned in subsection (3)(a)(ii) are—

• (a) that appropriate arrangements have been made for the publication of the results of the monitoring referred to in condition 4 in the table;

• (b) that a scheme is in place to provide financial or other benefit for the local area.

• (7) A hydraulic fracturing consent may be issued subject to any conditions thought to be appropriate by the Secretary of State or the Welsh Ministers.

• (8) A breach of such a condition is to be treated as if it were a breach of a condition of a well consent.

4B

• (1) “Associated hydraulic fracturing” means hydraulic fracturing of shale or strata encased in shale which—

• (a) is carried out in connection with the use of the relevant well to search or bore for or get petroleum, and

• (b) involves, or is expected to involve, the injection of—

• (i) more than 1,000 cubic metres of fluid at each stage, or expected stage, of the hydraulic fracturing, or

• (ii) more than 10,000 cubic metres of fluid in total.

• (2) For the purposes of deciding the depth at which associated hydraulic fracturing is taking place in land—

• (a) the depth of a point in land below surface level is the distance between that point and the surface of the land vertically above that point; and

• (b) in determining what is the surface of the land, any building or other structure on the land, and any water covering the land, must be ignored.

• (3) Subsections (1) and (2) apply for the purposes of section 4A and this section.

• (4) The Secretary of State must, by regulations made by statutory instrument, specify—

• (a) the descriptions of areas in the English onshore area which are “protected groundwater source areas”, and

• (b) the descriptions of areas in the English onshore area which are “other protected areas”,

for the purposes of section 4A.

• (5) A statutory instrument which contains regulations under subsection (4) may not be made unless a draft of the instrument has been laid before and approved by a resolution of each House of Parliament.

• (6) The Secretary of State must lay a draft of the first such regulations before each House of Parliament on or before 31 July 2015.

• (7) The Secretary of State must consult—

• (a) the Environment Agency before making any regulations under subsection (4)(a) ... ;

• (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (7A) The Welsh Ministers may, by regulations made by statutory instrument, specify—

• (a) the descriptions of areas in the Welsh onshore area that are “protected groundwater source areas”, and

• (b) the descriptions of areas in the Welsh onshore area that are “other protected areas”,

for the purposes of section 4A.

• (7B) A statutory instrument that contains regulations under subsection (7A) may not be made unless a draft of the instrument has been laid before and approved by a resolution of the National Assembly for Wales.

• (7C) Before making regulations under subsection (7A)(a), the Welsh Ministers must consult the Natural Resources Body for Wales.

• (8) These expressions have the meanings given—

• “development order” has the meaning given in section 59 of the Town and Country Planning Act 1990;

• “environmental permit” means a permit granted under regulation 13 of the Environmental Permitting (England and Wales) Regulations 2016 (S.I. 2016/1154);

• “hydraulic fracturing consent” has the meaning given in subsection (1)(b);

• “licensee” means the holder of the onshore licence for England or Wales;

• “local planning authority” means—the planning authority to which the application for the relevant planning permission was made (unless the Secretary of State or Welsh Ministers are responsible for determining the application), orthe Secretary of State or Welsh Ministers (if responsible for determining the application);

• “onshore licence for England or Wales” means a licence granted under section 3 which authorises a person to search or bore for or get petroleum in those parts of the landward area (within the meaning of the Petroleum Licensing (Exploration and Production) (Landward Areas) Regulations 2014) that are in England or Wales or are beneath waters (other than waters adjacent to Scotland);

• “relevant environmental regulator” means—the Environment Agency, if the relevant well is situated in the English onshore area, orthe Natural Resources Body for Wales, if the relevant well is situated in the Welsh onshore area;

• “relevant planning permission” means planning permission to be granted, or granted, in respect of development which includes the relevant well;

• “relevant undertaker” means the water undertaker or sewerage undertaker in whose area of appointment the relevant well is located;

• “relevant well” means the well to which a well consent relates;

• “well consent” means a consent in writing of the OGA or the Welsh Ministers to the commencement of drilling of a well.

• (9) The power of the Secretary of State to make regulations under section 4 includes power to make such amendments of the definition of “onshore licence for England or Wales” in this section (as it applies to the English onshore area) as the Secretary of State considers appropriate in consequence of any other exercise of the power by the Secretary of State under section 4.

• (9A) The power of the Welsh Ministers to make regulations under section 4 includes power to make such amendments of the definition of ““onshore licence for England and Wales”” in this section (as it applies to the Welsh onshore area) as they consider appropriate in consequence of any exercise by them of the power under section 4.

• (10) The Secretary of State may, by regulations made by statutory instrument—

• (a) make such amendments of column 2 of the table in section 4A as the Secretary of State considers appropriate as regards an application for a hydraulic fracturing consent in relation to land in the English onshore area, and

• (b) make such other amendments of section 4A or this section as the Secretary of State considers appropriate in consequence of provision made under paragraph (a).

• (11) A statutory instrument which contains regulations under subsection (10) may not be made unless a draft of the instrument has been laid before and approved by a resolution of each House of Parliament.

• (12) The Welsh Ministers may, by regulations made by statutory instrument—

• (a) make such amendments of column 2 of the table in section 4A as the Welsh Ministers consider appropriate as regards an application for a hydraulic fracturing consent in relation to land in the Welsh onshore area, and

• (b) make such other amendments of section 4A or this section as the Welsh Ministers consider appropriate in consequence of provision made under paragraph (a).

• (13) A statutory instrument that contains regulations under subsection (12) may not be made unless a draft of the instrument has been laid before and approved by a resolution of the National Assembly for Wales.

9BA

• (1) The Secretary of State must act in accordance with the current strategy or strategies when exercising the functions mentioned in subsection (2).

• (2) Those functions are functions under Part 4 to the extent that they concern reduction of the costs of abandonment of offshore installations and submarine pipelines (including the reduction of such costs by means of the timing of measures proposed in abandonment programmes and by the inclusion in such programmes of provision for collaboration with other persons).

9HA

• (1) For the purposes of this Part an offshore installation is a relevant offshore installation if and in so far as it is used in relation to petroleum within subsection (2) (including such petroleum after it has been got).

• (2) Petroleum is within this subsection if it is petroleum which for the time being exists in its natural condition in strata beneath—

• (a) the territorial sea adjacent to Great Britain, or

• (b) the sea in any area designated under section 1(7) of the Continental Shelf Act 1964.

• (3) In this Part “owner”, in relation to a relevant offshore installation, means—

• (a) a person in whom the installation is vested, and

• (b) a lessee and any person occupying or controlling the installation.

28A

• (1) A person to whom a notice may be given under section 29(1) in relation to an offshore installation or submarine pipeline may not abandon, or begin or continue the decommissioning of, the installation or pipeline unless an abandonment programme approved by the Secretary of State has effect in relation to the installation or pipeline.

• (2) A person who without reasonable excuse contravenes subsection (1) is guilty of an offence.

34A

• (1) This section applies where an abandonment programme approved by the Secretary of State includes provision by virtue of which the programme may be amended.

• (2) A person who proposes to make an amendment under such a provision that is likely to have an effect on the cost of carrying out the programme must frame the amendment so as to ensure (whether by means of the timing of the measures proposed, the inclusion of provision for collaboration with other persons, or otherwise) that the cost of carrying out the programme as proposed to be amended is kept to the minimum that is reasonably practicable in the circumstances.

• (3) If it appears to the person who proposes to make the amendment that subsection (2) applies, the person must consult the OGA before making the amendment.

• (4) When consulted under subsection (3) the OGA must (in particular) consider and advise on—

• (a) alternatives to abandoning or decommissioning the installation or pipeline, such as re-using or preserving it, and

• (b) whether subsection (2) applies and, if so, whether it has been complied with.

• (5) Any person who has the function of approving amendments made under a provision mentioned in subsection (1) must, when exercising the function, take into account the effect of the proposed amendment on the cost of carrying out the programme.

36A

• (1) This section applies where an abandonment programme approved by the Secretary of State has effect in relation to an installation or pipeline.

• (2) The Secretary of State may, for the purpose of reducing the total cost of carrying out the programme, by written notice require any person who submitted the programme to take, or refrain from taking, action of a description specified in the notice.

• (3) The notice may, in particular, require—

• (a) changes to the times at which the measures proposed in the programme are to be carried out;

• (b) the persons who are under a duty to secure that the programme is carried out to collaborate with other persons.

• (4) The programme, and any condition to which it is subject, has effect subject to any notice given under this section.

• (5) A notice given under this section may not increase the total costs to be met by any person who is to be subject to obligations under the programme or under any other abandonment programme.

• (6) The Secretary of State may not give a notice to a person under this section without first giving the person an opportunity to make written representation as to whether the notice should be given.

• (7) A person to whom a notice is given under this section who without reasonable excuse fails to comply with the notice is guilty of an offence.

• (8) If a notice under this section is not complied with, the Secretary of State may—

• (a) do anything necessary to give effect to the notice, and

• (b) recover from the person to whom the notice was given any expenditure incurred under paragraph (a).

• (9) A person liable to pay any sum to the Secretary of State by virtue of subsection (8) must also pay interest on that sum for the period beginning with the day on which the Secretary of State notified the person of the sum payable and ending with the date of payment.

• (10) The rate of interest payable in accordance with subsection (9) is a rate determined by the Secretary of State as comparable with commercial rates.

8A

• (1) This section applies for the purposes of this Part.

• (1A) The “appropriate authority” means—

• (a) in relation to the Scottish onshore area, the Scottish Ministers;

• (aa) in relation to the Welsh onshore area, the Welsh Ministers;

• (b) otherwise, the OGA.

• (2) The “appropriate Minister” means—

• (a) in relation to the Scottish onshore area, the Scottish Ministers;

• (aa) in relation to the Welsh onshore area, the Welsh Ministers;

• (b) otherwise, the Secretary of State.

• (3) The Scottish onshore area is the area of Scotland that is within the baselines established by any Order in Council under section 1(1)(b) of the Territorial Sea Act 1987 (extension of territorial sea).

• (4) In subsection (3) “Scotland” has the same meaning as in the Scotland Act 1998.

• (5) The Welsh onshore area is the area of Wales that is within the baselines established by any Order in Council under section 1(1)(b) of the Territorial Sea Act 1987 (extension of territorial sea).

• (6) In subsection (5) “Wales” has the same meaning as in the Government of Wales Act 2006.

• (7) The English onshore area is the area of England and the sea adjacent to England that is within the baselines established by any Order in Council under section 1(1)(b) of the Territorial Sea Act 1987 (extension of territorial sea).

Acquisition of rights to use controlled petroleum pipelines.

Acquisition of rights to use controlled petroleum pipelines.

Section 17F: supplemental.

Enforcement.

Preparation of programmes.

Failure to submit programmes.

Failure to submit programmes.

Withdrawal of approval.

Interpretation of Part III.

Preparation of programmes.

Regulations.