Tax Laws Amendment (2009 Measures No. 3) Act 2009 (47 of 2009)

Schedule 3   Petroleum resource rent tax

Part 2   Exploration expenditure etc.

Petroleum Resource Rent Tax Assessment Act 1987

25   At the end of section 5

Add:

Post-30 June 2008 petroleum project

(5) For the purposes of the application of this Act (including this section) to a post-30 June 2008 petroleum project, a reference to exploration for petroleum in, or recovery of petroleum from, a production licence area, an exploration permit area or a retention lease area is a reference to exploration for petroleum in, or recovery of petroleum from, the production licence area, the exploration permit area or the retention lease area while the production licence, exploration permit or retention lease concerned is or was in force.

(6) For the purposes of the application of this Act to a post-30 June 2008 petroleum project, a reference to exploration for petroleum in, or recovery of petroleum from, the eligible exploration or recovery area in relation to a petroleum project is a reference to:

(a) if the production licence, or any production licence, in relation to the project is a production licence (in this paragraph called the current production licence ) derived from an exploration permit (in this paragraph called the prior exploration permit ) - exploration for petroleum in, or recovery of petroleum from, the exploration permit area of the prior exploration permit, where the exploration or recovery occurred:

(i) before the current production licence came into force; and

(ii) if, before the current production licence came into force, there came into force one or more retention leases, or one or more other production licences, derived from the prior exploration permit - after whichever of those retention leases or other production licences last came into force before the current production licence came into force; and

(b) if the production licence, or any production licence, in relation to the project is a production licence (in this paragraph called the current production licence ) derived from a retention lease (in this paragraph called the prior retention lease ) - exploration for petroleum in, or recovery of petroleum from, the retention lease area of the prior retention lease, where the exploration or recovery occurred before the current production licence came into force; and

(c) if:

(i) the production licence, or any production licence, in relation to the project is a production licence (in this paragraph called the current production licence ) derived from a retention lease (in this paragraph called the prior retention lease ); and

(ii) the prior retention lease was derived from an exploration permit (in this paragraph called the prior exploration permit );

exploration for petroleum in, or recovery of petroleum from, the exploration permit area of the prior exploration permit, where the exploration or recovery occurred:

(iii) before the prior retention lease came into force; and

(iv) if, before the prior retention lease came into force, there came into force one or more other production licences, or one or more other retention leases, derived from the prior exploration permit - after whichever of those other retention leases or other production licences last came into force before the prior retention lease came into force; and

(d) exploration for petroleum in, or recovery of petroleum from, the production licence area of the production licence, or the production licence areas of the production licences, in respect of the project.

(7) If:

(a) paragraph (6)(c) applies to a post-30 June 2008 petroleum project; and

(b) the prior retention lease mentioned in that paragraph is one of a set of 2 or more retention leases that:

(i) came into force at the same time; and

(ii) were derived from the prior exploration permit mentioned in that paragraph; and

(c) the production licence, or the production licences, in relation to one or more other post-30 June 2008 petroleum projects were derived from one or more of the retention leases included in the set mentioned in paragraph (b) of this subsection; and

(d) exploration expenditure incurred in relation to the petroleum project mentioned in paragraph (a) of this subsection is attributable to exploration for petroleum in, or recovery of petroleum from, the exploration permit area of the prior exploration permit;

then, for the purposes of the application of this Act to the petroleum project mentioned in paragraph (a) of this subsection, the amount of the exploration expenditure mentioned in paragraph (d) of this subsection is taken to be the amount worked out using the following formula:

Unadjusted amount of exploration expentiture x [Number of retention leases relating to the petroleum project mentioned in paragraph (a) of this subsection / Total number of retantion leases]

where:

number of retention leases relating to the petroleum project mentioned in paragraph (a) of this subsection means the number of retention leases:

(a) from which the production licence, or the production licences, in relation to the petroleum project mentioned in paragraph (a) of this subsection were derived; and

(b) that are included in the set mentioned in paragraph (b) of this subsection.

total number of retention leases means the number of retention leases that are included in the set mentioned in paragraph (b) of this subsection.

unadjusted amount of exploration expenditure means the amount that, apart from this subsection, is the amount of the exploration expenditure mentioned in paragraph (d) of this subsection.