Applications for an Exploration Permit
Application Details
Applications for areas in the 2007 release are invited under the work program bidding system in accordance with section 20 of the Petroleum (Submerged Lands) Act 1967 (PSLA). Two copies of the application must be submitted.
The PSLA has been rewritten to simplify the presentation of the legislation after more than 30 years of operation and amendments. This will improve its user friendliness and reduce compliance and administrative costs, without changing any major policies or the current management regime. The rewritten Act will come into effect during 2007.
When the new Act (which will be called the “Offshore Petroleum Act”) comes into force, a ‘business as usual’ approach will prevail during the transition.
Application Content
Applications must contain all of the following:
Technical Assessment
The applicant's technical assessment of the petroleum potential of the area
should include the concepts underlying its proposed exploration work program,
with sufficient detail to support that program. A sound technical assessment
would include an assessment of relevant data and support the amount of seismic
surveying and the number and conceptual targets of wells to be drilled.
Minimum Guaranteed Work Program (Years 1, 2 and 3)
The applicant's minimum guaranteed proposal (including indicative minimum
expenditure) should include exploration wells to be drilled, seismic and
other surveying activities (specifying the surveying technique), data evaluation
and other work within the permit area, for each year of the first three
years of the permit term.
Pre-purchase of existing non-exclusive data cannot form part of the work program (but any interpretation of that data included in the technical assessment will be taken into account in assessing the relative merits of the work program proposed). Such data proposed to be purchased after the award of a permit may form part of the work program provided that this does not disadvantage a competitor who purchased the data prior to bidding.
The minimum guaranteed work program should only comprise exploration work - appraisal work should not normally be included. Guidance on whether a well would be accepted as an exploration well is provided in section 3 below.
Applicants should note it is mandatory that the minimum work program proposed in each year of the term of the exploration permit is stated precisely to avoid any ambiguity. Proposals for work programs that cannot be guaranteed to be undertaken within the first three years of the permit term must not be included.
Secondary Work Program (Years 4, 5 and 6)
A secondary work program must be specified. The secondary work program should
include substantial operational activities that will significantly advance
exploration of the area - appraisal work should not normally be included.
The applicant's proposal (including indicative minimum expenditure) should include exploration wells to be drilled, seismic and other surveying activities (specifying the surveying technique), data evaluation and other work within the permit area, for each of the three remaining years of the permit term (the secondary work program).
Particulars of the applicant to be provided
- The technical qualifications of the applicant and of its key employees.
- The technical advice available to the applicant.
- The financial resources available to the applicant, including evidence of the applicant's ability to fund the work program proposed, a statement of other exploration commitments over the next 6 years and a copy of the latest annual and quarterly reports for each applicant company.
- Where relevant, evidence of the viability of the consortium lodging the application, including evidence that a satisfactory settlement has been, or can be, reached on the Joint Operating Agreement (a copy of a signed Heads of Agreement will generally suffice).
- The percentage participating interest of each party to the application.
- Details of any permit cancellations or defaults on work program conditions under the PSLA of any of the applicant companies over the previous five years, and why the applicant believes the prior failure is irrelevant to the current application, eg participation in the ‘good standing’ scheme.
- Details of any relationship that a director of an applicant company had with any company that had defaulted over the previous five years.
Other Information
Such other information as the applicant wishes to be taken into account
in consideration of the application.
Applicants are asked to clearly state in their work program bid whether acquisition of seismic survey data relates to purchase/licensing of existing seismic data, or whether a new seismic survey will be undertaken as part of the work program.
Fee
Each application must be accompanied by a fee payable to the “Commonwealth of Australia” through an Australian bank or bank cheque (electronic funds transfer or credit card facilities are not available). The amount of the fee is prescribed in Regulations under the PSLA, and at the time of printing was A$4040 including GST. Changes to fees are notified in Australian Petroleum News. Request this electronic publication free of charge by contacting: petroleum.exploration@industry.gov.au.
Renewal of Permits
In most circumstances, permits can be renewed for a further two, five year terms after the initial six year term.
Permit holders wishing to renew their permit must submit their application between six and three months before the permit expires. Renewal permit terms are five years.
Upon renewal of a permit the number of blocks that can be renewed is generally half the number of blocks in the permit. Special provisions apply to permits with six or fewer blocks. Permits of only one block cannot be renewed.
The Act contains specific provisions covering different relinquishment scenarios.