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Cost of delivery and treatment of petroleum	11A.  - (1) Where petroleum or petroleum of any kind is delivered to the Minister in pursuance of clause 11 of this licence, the Minister shall pay to the Licensee a sum in respect of the cost of conveying and treating petroleum; and clause 9(7) to (7B) of this licence shall apply for the purpose of ascertaining that sum as if references to clause 9(5)(b) were references to this paragraph.     (2) Where, in any chargeable period, petroleum or petroleum of any kind is delivered to the Minister as mentioned in paragraph (1) of this clause, the Licensee shall, within two months after the end of that period, deliver to the Minister, in such form as the Minister may specify, a statement of the amount which the Licensee estimates is payable by the Minister in pursuance of this clause in respect of that period; and where the amount specified in the statement is larger or smaller than the total amount (if any) already paid by the Minister in pursuance of this clause in respect of that period, then -  (a) if it is larger the difference shall be paid forthwith by the Minister to the Licensee; and (b) if it is smaller the difference shall be paid forthwith by the Licensee to the Minister.     (3) The Minister may from time to time, after a statement in respect of any chargeable period has been delivered to him in pursuance of paragraph (2) of this clause and before he has given to the Licensee a notice in pursuance of paragraph (4) of this clause in respect of that period, give a notice in writing to the Licensee specifying the amount which the Minister estimates is payable by him in pursuance of this clause in respect of that period; and where the amount specified in the notice is larger or smaller than the total amount already paid by the Minister in pursuance of this clause in respect of that period, then -  (a) if it is larger the difference shall be paid forthwith by the Minister to the Licensee; and (b) if it is smaller the difference shall be paid forthwith by the Licensee to the Minister.     (4) When it appears to the Minister that the amount payable by him in pursuance of this clause in respect of any chargeable period has been finally ascertained, he may give to the Licensee a notice in writing specifying the amount which the Minister considers is so payable; and where the amount specified in the notice is larger or smaller than the total amount already paid by the Minister in pursuance of this clause in respect of that period, then, subject to paragraph (5) of this clause -  (a) if it is larger the difference shall be paid forthwith by the Minister to the Licensee; and (b) if it is smaller the difference shall be paid forthwith by the Licensee to the Minister.     (4A) If, after the date when the Minister gave notice to the Licensee in pursuance of paragraph (4) of this clause or this paragraph in respect of a chargeable period, it appears to the Minister that as a result of costs incurred after the end of the period there is an increase in the amount payable by him in pursuance of this clause in respect of the period, he may give notice in writing to the Licensee specifying the increased amount; and where he does so he shall forthwith pay to the Licensee an amount equal to the difference between the increased amount and the total amount already paid by the Minister in pursuance of this clause in respect of the period.     (5) A decision made by the Minister for the purposes of paragraph (3), (4) or (4A) of this clause shall not be called in question by the Licensee except that any dispute between the Minister and the Licensee as to whether an amount specified in a notice given in pursuance of the said paragraph (4) or (4A) is payable in pursuance of this clause may, during the period of 28 days beginning with the day on which the Licensee receives the notice, be referred to arbitration in the manner provided by clause 38 of this licence.     (6) An amount in respect of interest shall be payable when a notice is given under paragraph (3), (4) or (4A) of this clause, and that amount shall be calculated in such manner as the Minister may specify from time to time in a notice in writing given by him to the Licensee; but -  (a) a notice in pursuance of this paragraph shall provide for amounts by way of interest to be calculated by applying a rate of interest which is for the time being a commercial rate of interest; (b) any such amount in respect of interest shall be disregarded in calculating for the purposes of paragraph (3), (4) or (4A) of this clause any amount already paid by the Minister in pursuance of this clause; (c) where costs of the kind mentioned in clause 9(7A)(b) of this licence are taken into account, they shall not affect the amount of interest payable in respect of any period ending earlier than two months after the chargeable period in which they were incurred.     (7) For the purposes of this clause any amount paid by the Minister or the Licensee on account of a prospective liability under paragraph (3), (4) or (4A) of this clause shall be treated as paid in pursuance of that paragraph.     (8) In this clause "chargeable period" has the same meaning as in clause 9 of this licence.
Measurement of petroleum obtained from the licensed area	12.  - (1) The Licensee shall measure or weigh by a method or methods customarily used in good oilfield practice and from time to time approved by the Minister all petroleum won and saved from the licensed area.      (1A) If and to the extent that the Minister so directs, the duty imposed by paragraph (1) of this clause shall be discharged separately in relation to petroleum won and saved -  (a) from each part of the licensed area which is an oil field for the purposes of the Oil Taxation Act 1975, (b) from each part of the licensed area which forms part of such an oil field extending beyond the licensed area, and (c) from each well producing petroleum from a part of the licensed area which is not within such an oil field.     (1B) If and to the extent that the Minister so directs, the preceding provisions of this clause shall apply as if the duty to measure or weigh petroleum included a duty to ascertain its quality or composition or both; and where a direction under this paragraph is in force, the following provisions of this clause shall have effect as if references to measuring or weighing included references to ascertaining quality or composition.     (2) The Licensee shall not make any alteration in the method or methods of measurement or weighing used by him or any appliances used for that purpose without the consent in writing of the Minister and the Minister may in any case require that no alteration shall be made save in the presence of a person authorised by the Minister.     (3) The Minister may from time to time direct that any weighing or measuring appliance shall be tested or examined in such manner, upon such occasions or at such intervals and by such persons as may be specified by the Minister's direction and the Licensee shall pay to any such person or to the Minister such fees and expenses for test or examination as the Minister may specify.     (4) If any measuring or weighing appliance shall upon any such test or examination as is mentioned in the last foregoing paragraph be found to be false or unjust the same shall if the Minister so determines after considering any representations in writing made by the Licensee be deemed to have existed in that condition during the period since the last occasion upon which the same was tested or examined pursuant to the last foregoing paragraph.
Keeping of accounts	13.  - (1) The Licensee shall keep in the United Kingdom full and correct accounts in a form from time to time approved by the Minister of -  (a) the quantity of petroleum in the form of gas won and saved; (b) the quantity of petroleum in any other form won and saved; (c) the name and address of any person to whom any petroleum has been supplied by the Licensee, the quantity so supplied, the price or other consideration therefor and the place to which the petroleum was conveyed pursuant to the agreement for such supply; and (d) such other particulars as the Minister may from time to time direct.     (2) The quantities of petroleum stated in such accounts may exclude any water separated from the petroleum and shall be expressed -  (a) in the case of petroleum in the form of gas, as volumes in cubic metres measured at, or calculated as if measured at, a temperature of 0 degrees centigrade and a pressure of one kilogramme force per square centimetre; (b) in any other case as weights in metric tons.     (3) Such accounts shall state separately the quantities used for the purposes of carrying on drilling and production operations and pumping to field storage, and quantities not so used, and in the case of petroleum not in the form of gas shall state the specific gravity of the petroleum and, if petroleum of different specific gravities has been won and saved, the respective quantities of each specific gravity.     (4) The Licensee shall within two months after the end of each half year in which this licence is in force and within two months after the expiration or determination of this licence deliver to the Minister an abstract in a form from time to time approved by the Minister of the accounts for that half year or for the period prior to such expiration or determination as the case may be.
Working obligations	14.  - (1) The Licensee shall during the initial term of this licence carry out with due diligence the scheme of prospecting and development including any geological survey by chemical or physical means or programme of test drilling or any of them set out in Schedule 3 to this licence.     (2) The Licensee shall give the Minister at least 21 days' written notice of any proposed seismic survey during the term of this licence of any area which is not wholly on the seaward side of the low water line and such notice shall indicate the nature of the survey and the total number of kilometres to be shot and shall be accompanied by a copy of the 1" Ordnance Survey map for the relevant area upon which the proposed lines of survey are indicated and by evidence that the planning authorities for the area to be surveyed have been consulted about the proposed survey, and in a case where any planning permission under the Town and Country Planning Act 1990[30] or the Town and Country Planning (Scotland) Act 1997[31] is required for the survey in question, evidence that such permission has been granted.     (3) The Licensee shall not carry out any seismic survey during the term of this licence of any such area as is mentioned in paragraph (2) if notice has not been given as aforesaid or if the Minister indicates to the Licensee within 14 days of the receipt of such notice that the survey is not to be carried out.     (4) If during the term of this licence the Minister serves a notice in writing on the Licensee requiring him to submit to the Minister, before a date specified in the notice, an appropriate programme for exploring for petroleum in the licensed area during a period so specified, the Licensee shall comply with the notice; and for the purposes of this paragraph an appropriate programme is one which any person who, if he -  (a) were entitled to exploit the rights granted by this licence; and (b) had the competence and resources needed to exploit those rights to the best commercial advantage; and (c) were seeking to exploit those rights to the best commercial advantage, could reasonably be expected to carry out during the period specified in the notice, and that period must be within the term of this licence and begin after the expiration of the initial term of this licence.     (5) If a programme is submitted to the Minister in consequence of a notice served by him in pursuance of paragraph (4) of this clause, then -  (a) he shall not be entitled to revoke this licence on the ground that the programme does not satisfy the requirements of that paragraph (hereafter in this clause referred to as "the relevant requirements"); but (b) if he is of opinion that the programme does not satisfy the relevant requirements he may serve a notice in writing on the Licensee stating his opinion and the reasons for it.     (6) Where notice in respect of a programme is served on the Licensee in pursuance of paragraph (5) of this clause he shall either -  (a) within twenty-eight days beginning with the date of service of the notice refer to arbitration, in the manner provided by clause 38 of this licence, the question of whether the programme satisfies the relevant requirements; or (b) within a reasonable period beginning with that date submit to the Minister a further programme which satisfies the relevant requirements; and where it is determined in consequence of any reference to arbitration in pursuance of sub-paragraph (a) of this paragraph that the programme in question does not satisfy the relevant requirements the Licensee shall submit to the Minister, as soon as possible after the date of the determination, a further programme which satisfies the relevant requirements.     (7) The Licensee shall carry out any programme submitted by him in pursuance of this clause as to which either -  (a) the Minister serves notice in writing on the Licensee stating that the Minister approves the programme; or (b) it is determined in consequence of any reference to arbitration in pursuance of this licence that the programme satisfies the relevant requirements; and any programme approved by the Minister in pursuance of this paragraph shall be deemed for the purposes of this licence to satisfy the relevant requirements.     (8) Where, in consequence of any breach or non-observance by the Licensee of any provision of paragraph (4), (6) or (7) of this clause, the Minister has power by virtue of paragraph (1) of clause 37 of this licence to revoke this licence, he may if he thinks fit exercise that power in relation to such part only of the licensed area as he may specify; and where he does so the rights granted by this licence shall cease in respect of the specified part of that area without prejudice to any obligation or liability imposed upon the Licensee or incurred by him under the terms of this licence.     (9) Where the Licensee has a duty by virtue of this clause to carry out a programme during a part of the term of this licence, the Minister may serve notice in pursuance of paragraph (4) of this clause in respect of another part of that term.
Development and production programmes	15.  - (1) The Licensee shall not -  (a) erect or carry out any relevant works, either in the licensed area or elsewhere, for the purpose of getting petroleum from that area or for the purpose of conveying to a place on land petroleum got from that area; or (b) get petroleum from that area otherwise than in the course of searching for petroleum or drilling wells, except with the consent in writing of the Minister or in accordance with a programme which the Minister has approved or served on the Licensee in pursuance of the following provisions of this clause.     (2) The Licensee shall prepare and submit to the Minister, in such form and by such time and in respect of such period during the term of this licence as the Minister may direct, a programme specifying -  (a) the relevant works which the Licensee proposes to erect or carry out during that period for either of the purposes mentioned in paragraph (1)(a) of this clause; (b) the proposed locations of the works, the purposes for which it is proposed to use the works and the times at which it is proposed to begin and to complete the erection or carrying out of the works; (c) the maximum and minimum quantities of petroleum in the form of gas and the maximum and minimum quantities of petroleum in other forms which, in each calendar year during the period aforesaid or in such other periods during that period as the Minister may specify, the Licensee proposes to get as mentioned in paragraph (1)(b) of this clause.     (3) If the Minister directs the Licensee -  (a) to prepare different programmes in pursuance of paragraph (2) of this clause in respect of petroleum from such different parts of the licensed area as are specified in the direction; or (b) where a programme approved or served in pursuance of this clause relates to a particular period during the term of this licence, to prepare a programme or programmes in pursuance of paragraph (2) of this clause in respect of a further period or further periods during that term, the Licensee shall comply with the direction.     (4) It shall be the duty of the Minister expeditiously to consider any programme submitted to him in pursuance of paragraph (2) of this clause and when he has done so to give notice in writing to the Licensee stating -  (a) that the Minister approves the programme; or (b) that the Minister approves the programme subject to the condition that such of the relevant works as are specified in the notice shall not be used before the expiration of the periods so specified in relation to the works or shall not be used without the consent in writing of the Minister; or (c) that the Minister rejects the programme on one or both of the following grounds, namely -  (i) that the carrying out of any proposals included in the programme in pursuance of paragraph (2) of this clause would be contrary to good oilfield practice; (ii) that the proposals included in the programme in pursuance of sub-paragraph (c) of the said paragraph (2) are, in the opinion of the Minister, not in the national interest; and a notice in pursuance of sub-paragraph (b) of this paragraph may contain different conditions in respect of different works.     (5) Where the Minister gives notice of rejection of a programme in pursuance of sub-paragraph (c) of paragraph (4) of this clause, then -  (a) if the grounds of the rejection consist of or include the ground mentioned in paragraph (i) of that sub-paragraph he shall include in the notice a statement of the matters in consequence of which he rejected the programme on that ground; and (b) if the grounds of the rejection consist of or include the ground mentioned in paragraph (ii) of that sub-paragraph he shall include in the notice a statement of the rates at which he considers that, in the national interest, petroleum should be got from the area to which the programme relates; and (c) the Licensee shall prepare and submit to the Minister, before the time specified in that behalf in the notice -  (i) where the notice contains such a statement as is mentioned in sub-paragraph (a) above, modifications of the programme which ensure that the carrying out of the programme with those modifications would not be contrary to good oilfield practice; (ii) where the notice contains such a statement as is mentioned in sub-paragraph (b) above, modifications of the programme which ensure the getting of petroleum from the area there mentioned at the rates specified in the statement and which (except so far as may be necessary in order to get petroleum at those rates) are not such that the carrying out of the programme with those modifications would be contrary to good oilfield practice; but the Licensee shall not be required by virtue of paragraph (i) of this sub-paragraph to submit modifications if the carrying out of the programme without modifications would not be contrary to good oilfield practice.     (6) If the Minister gives notice in writing to the Licensee that the Minister approves the modifications of a programme which have been submitted to him in pursuance of sub-paragraph (c) of paragraph (5) of this clause, the programme with those modifications shall be deemed to be approved by the Minister; but if the Licensee fails to perform the duty imposed on him by that sub-paragraph the Minister may if he thinks fit, instead of revoking this licence in consequence of the failure, serve on the Licensee such a programme as the Minister considers that the Licensee should have submitted to him in respect of the area and period to which the rejected programme related.     (7) Where the Minister proposes to approve a programme subject to a condition in pursuance of paragraph (4)(b) of this clause or to reject a programme in pursuance of paragraph (4)(c) of this clause or to serve a programme on the Licensee in pursuance of paragraph (6) of this clause he shall before doing so -  (a) give the Licensee particulars of the proposal and an opportunity of making representations to the Minister about the technical and financial factors which the Licensee considers are relevant in connection with the proposal; and (b) consider any such representations then made to him by the Licensee; and the Minister shall not approve a programme subject to such a condition unless he is satisfied that the condition is required in the national interest.     (8) The Licensee shall carry out any programme approved or served on him by the Minister in pursuance of this clause or, if such a programme is varied in pursuance of clause 16 of this licence, the programme as so varied except so far as the Licensee is authorised in writing by the Minister to do otherwise or is required to do otherwise by such a condition as is mentioned in paragraph (4)(b) of this clause; but if it is necessary to carry out certain works in order to comply with provisions included in a programme by virtue of paragraph (5)(c) of this clause or provisions of a programme served on the Licensee in pursuance of paragraph (6) of this clause or provisions of a programme as varied in pursuance of clause 16 of this licence, then, notwithstanding anything in the programme as to the time when those provisions are to be complied with, the Licensee shall not be treated as having failed to comply with those provisions before the expiration of the period reasonably required for carrying out the works.     (9) In this clause "relevant works" means any structures and any other works whatsoever which are intended by the Licensee to be permanent and are neither designed to be moved from place to place without major dismantling nor intended by the Licensee to be used only for searching for petroleum.
Provisions supplementary to clause 15	16.  - (1) A consent given by the Minister in pursuance of clause 15(1) of this licence may be given subject to such conditions as are specified in the document signifying the consent and may in particular, without prejudice to the generality of the preceding provisions of this paragraph, be limited to a period so specified.     (2) Where -  (a) the Minister gives notice in respect of a programme in pursuance of paragraph (4)(a) or (b) or paragraph (6) of clause 15 of this licence or serves a programme in pursuance of the said paragraph (6); or (b) it is determined by arbitration that the Licensee is not required by virtue of paragraph (i) of clause 15(5)(c) of this licence to submit modifications of a programme in respect of which notice of rejection containing such a statement as is mentioned in the said paragraph (i) was given by the Minister in pursuance of clause 15(4)(c) of this licence, the Minister may give to the Licensee, with the notice given or the programme served as mentioned in sub-paragraph (a) of this paragraph or, in a case falling within sub-paragraph (b) of this paragraph, within the period of three months beginning with the date of the arbitrator's or arbiter's determination, a notice (hereafter in this clause referred to as a "limitation notice") authorising the Minister, by a further notice given to the Licensee from time to time after the expiration of the period specified in that behalf in the limitation notice, to provide that the programme to which the limitation notice relates shall have effect while the further notice is in force with the substitution for any quantity of petroleum or any period specified in the programme in pursuance of clause 15(2)(c) of this licence of a different quantity of petroleum or a different period specified in the further notice.     (3) A quantity or period specified in such a further notice as that to be substituted for a quantity or period which is specified in the programme in question shall be within the limits specified in the limitation notice as those applicable to that quantity or period specified in the programme; and those limits shall be such as to secure that the expenditure to be incurred by the Licensee in complying with the further notice, in a case where an effect of the notice is to increase the quantity of petroleum which the Licensee is required to get from the licensed area in any period, is less than the cost of drilling a new well in the licensed area at the time when the further notice is given.     (4) Where the Minister proposes to give a limitation notice or any such further notice as aforesaid he shall before doing so -  (a) give the Licensee particulars of the proposal and an opportunity of making representations to the Minister about the technical and financial factors which the Licensee considers are relevant in connection with the proposal; and (b) consider any such representations then made to him by the Licensee; and the Minister shall not give such a further notice of which an effect is to increase the quantity of petroleum which the Licensee is required to get from the licensed area during any period unless the Minister is satisfied that the notice is required by reason of a national emergency and shall not give any other such further notice as aforesaid unless he is satisfied that the notice is required in the national interest.     (5) A limitation notice or such a further notice as aforesaid may -  (a) specify any quantity or period by reference to such factors as the Minister thinks fit; and (b) in the case of such a further notice, contain provisions as to -  (i) the date when the notice is to come into force, (ii) the date when the notice is to cease to be in force, and specify different dates in pursuance of this sub-paragraph for different provisions of the notice; and the Minister may revoke such a further notice at a particular time by serving on the Licensee a notice in writing stating that the further notice is revoked at that time.     (6) Any question arising under clause 15 of this licence or this clause as to what is, is not or is required in the national interest or as to what is, or is required by reason of, a national emergency shall be determined by the Minister.     (7) The Licensee shall ensure that any conditions to which an approval is subject to pursuance of clause 15(4)(b) of this licence or a consent is subject in pursuance of paragraph (1) of this clause are complied with.     (8) If in respect of part of the licensed area -  (a) a consent has been given in pursuance of paragraph (1) of clause 15 of this licence; or (b) the Licensee has submitted to the Minister, in accordance with a direction given by virtue of paragraph (3)(a) of that clause, a programme in pursuance of paragraph (2) of that clause -  (i) as respects which the Minister has served notice in pursuance of paragraph (4)(a) or (b) or paragraph (6) of that clause, or (ii) in consequence of which the Minister has served a programme on the Licensee in pursuance of the said paragraph (6), or (iii) in respect of which it has been determined by arbitration that the Licensee is not required by virtue of paragraph (5)(c)(i) of that clause to submit modifications, paragraph (1) of clause 37 of this licence shall not authorise the Minister to revoke this licence in relation to that part of the licensed area in consequence of any breach or non-observance, while the consent is in force or during the period to which the programme relates, of any provision of the said clause 15 in connection with a different part of the licensed area.     (9) Where in consequence of any breach or non-observance by the Licensee of any provision of clause 15 of this licence the Minister has power by virtue of paragraph (1) of clause 37 of this licence to revoke this licence or, in consequence of paragraph (8) of this clause, to revoke it in respect of part only of the licensed area, he may if he thinks fit -  (a) in a case where he has power to revoke this licence, exercise the power in relation to such part only of the licensed area as he may specify; and (b) in a case where by virtue of the said paragraph (8) he has power to revoke it in respect of part only of the licensed area, exercise the power in relation to such portion only of that part as he may specify; and where in consequence of the said paragraph (8) or by virtue of the preceding provisions of this paragraph the Minister revokes this licence in respect of a part or portion of the licensed area, the rights granted by this licence shall cease in respect of that part or portion without prejudice to any obligation or liability imposed upon the Licensee or incurred by him under the terms of this licence.

[31] 1997 c.8.back