How long is the hydrocarbon exploration period? What are the procedures for approving extension of hydrocarbon exploration time limit in Vietnam?
How long is the hydrocarbon exploration period in Vietnam?
Pursuant to Article 31 of the Law on Petroleum 2022, it is stipulated as follows:
Duration of petroleum contracts
1. Duration of a petroleum contract shall not be over 30 years, where the hydrocarbon exploration period shall not exceed 05 years, except for the case prescribed in Clause 2 of this Article.
2. For an oil block named in the list of oil blocks to which investment incentives and special investment incentives shall be given, the duration of the petroleum contract shall not exceed 35 years, where the hydrocarbon exploration period shall not exceed 10 years.
3. Duration of a petroleum contract may be extended at the maximum of 05 years and the exploration period may be extended but the extension period shall not exceed 05 years on the basis of the approval of the Ministry of Industry and Trade, except for the case prescribed in Clause 4 of this Article.
4. For reasons of national defense and security, complicated petroleum geology conditions, particularly disadvantageous field conditions for performing petroleum operations or in case of necessity to ensure effective gas extraction period, the Prime Minister shall approve of further extension of the duration of the petroleum contract and the extension period prescribed in Clause 3 of this Article on the basis of the appraisal of the Ministry of Industry and Trade.
5. After the contractor declared that the discovery is commercial but consumer market is not found and appropriate requirements for pipelines and processing facilities are not met, the contractor may retain the discovered area. The further period in which the discovery area is retained shall not exceed 05 years on the basis of the approval for the Ministry of Industry and Trade. In case the period in which the discovery area is retained expires but consumer market is not found and appropriate requirements for pipelines and treatment facilities are not met, the Prime Minister shall consider extending the period for not exceeding 02 years on the basis of the appraisal of the Ministry of Industry and Trade. During the further period, the contractor must perform works committed in the petroleum contract.
6. In case of force majeure that contracting parties consents to temporarily relinquish exercise of several rights and obligation mentioned in the petroleum contract, PVN shall send a report to the Ministry of Industry and Trade for decision. The period in which several rights and obligation stated in the petroleum contract are temporarily relinquished due to force majeure shall be calculated from the beginning to the end of this force majeure.
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According to the above regulations, the hydrocarbon exploration period shall not exceed 05 years
For an oil block named in the list of oil blocks to which investment incentives and special investment incentives shall be given, the hydrocarbon exploration period shall not exceed 10 years.
The exploration period may be extended but the extension period shall not exceed 05 years on the basis of the approval of the Ministry of Industry and Trade.
For reasons of national defense and security, complicated petroleum geology conditions, particularly disadvantageous field conditions for performing petroleum operations or in case of necessity to ensure effective gas extraction period, the Prime Minister shall approve of further extension of the duration of the petroleum contract and the extension period on the basis of the appraisal of the Ministry of Industry and Trade
Note: The period in which several rights and obligation stated in the petroleum contract are temporarily relinquished due to force majeure or reasons of national defense and security shall be shall not be included in the term of the petroleum contract.
How long is the hydrocarbon exploration period? What are the procedures for approving extension of hydrocarbon exploration time limit in Vietnam?
What are the procedures for approving extension of hydrocarbon exploration time limit in Vietnam?
Pursuant to the provisions of Article 25 of Decree No. 45/2023/ND-CP stipulating the procedures for approving extension of hydrocarbon exploration time limit, the following procedures shall be carried out:
Step 1. At least 60 days before the end of each smaller period or final day of hydrocarbon exploration period, on the basis of request of contractors approved by the PVN, the PVN shall submit 2 sets of documents (1 set of original documents and 1 set of copies) to the Ministry of Industry and Trade directly or via post service to request approval for extension of hydrocarbon exploration period.
Step 2. Within 5 working days from the date on which adequate documents are received, the Ministry of Industry and Trade shall send written request to the Ministry of Planning and Investment, Ministry of Finance, Ministry of Justice, Ministry of National Defense, Ministry of Foreign Affairs, Ministry of Public Security, Committee for Management of State Capital at Enterprises (if PVN participates in petroleum contracts as contractors), and relevant ministries, central departments to provide feedback.
Step 3. Within 15 days from the date on which written request for feedback sent by the Ministry of Industry and Trade is received, ministries and central departments must send written feedback within their competence to the Ministry of Industry and Trade.
Step 4. Within 45 days from the date on which adequate documents are received, the Ministry of Industry and Trade shall promulgate written approval for extension of hydrocarbon exploration period.
What is the application for approving extension of hydrocarbon exploration time limit in Vietnam?
Pursuant to the provisions of Clause 2, Article 25 of Decree No. 45/2023/ND-CP stipulating that the application for approving extension of hydrocarbon exploration time limit includes:
- Written request for approval of extension of hydrocarbon exploration period which states reason for extension; plans for performing petroleum operations during extended period; additional work commitment, corresponding financial commitment, and other propositions to be implemented during extended period (if any);
- Assessment of PVN regarding request of the contractors; documents on acknowledgement and presentation of the contractors (if any);
- Other relevant documents.
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