When to terminate petroleum contracts in Vietnam? In what cases must the contracting parties temporarily relinquish exercise of several rights and obligations mentioned in the petroleum contract?
When to terminate petroleum contracts in Vietnam?
Pursuant to Article 35 of the 2022 Petroleum Law of Vietnam stipulating as follows:
Termination of petroleum contracts
1. A petroleum contract shall be terminated according to the term prescribed in the contract or when the duration of the contract ends but the contract is not renewed according to Clause 3 and Clause 4 Article 31 of this Law.
2. A petroleum contract shall be terminated prior to the term agreed upon by the parties if they fulfilled their agreed obligation and send a notification to PVN 06 months prior to the early termination date.
Pursuant to Clause 1, Article 31 of the 2022 Petroleum Law of Vietnam and Clause 2, Article 31 of the 2022 Petroleum Law of Vietnam 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.
Thus, a petroleum contract shall be terminated according to the term prescribed in the contract or when the duration of the contract ends for no more than 30 years or no more than 35 years for an oil block named in the list of oil blocks to which investment incentives and special investment incentives.
When to terminate petroleum contracts in Vietnam? In what cases must the contracting parties temporarily relinquish exercise of several rights and obligations mentioned in the petroleum contract?
In what cases must the contracting parties temporarily relinquish exercise of several rights and obligations mentioned in the petroleum contract?
Pursuant to Clause 6, Article 31 of the 2022 Petroleum Law of Vietnam, Clause 7 Article 31 of the 2022 Petroleum Law of Vietnam and Clause 8 Article 31 of the 2022 Petroleum Law of Vietnam stipulating as follows:
Duration of petroleum contracts
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6. In case of force majeure that contracting parties consents to temporarily relinquish exercise of several rights and obligations 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.
7. The period in which several rights and obligation stated in the petroleum contract are temporarily relinquished shall be decided by the Government according to the proposal of the competent authority for national defense and security reasons.
8. The extension period of hydrocarbon exploration, the period in which the discovery area that is declared a commercial discovery is retained and the period in which several rights and obligation stated in the petroleum contract are temporarily relinquished due to force majeure or for the national defense and security reasons shall not be included in the duration of the petroleum contract.
Thus, the parties to a petroleum contract must temporarily relinquish exercise of several rights and obligations mentioned in the petroleum contract in the following cases:
- In case of force majeure that contracting parties consents to temporarily relinquish exercise of several rights and obligations 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 obligations 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.
- The period in which several rights and obligations stated in the petroleum contract are temporarily relinquished shall be decided by the Government according to the proposal of the competent authority for national defense and security reasons.
Note: The period of temporary relinquishment of exercise of several rights and obligations mentioned in the petroleum contract in case of force majeure or for the national defense and security reasons shall not be included in the duration of the petroleum contract.
Which agency is competent to settle disputes arising from petroleum contracts in Vietnam?
Pursuant to Article 37 of the 2022 Petroleum Law of Vietnam stipulating as follows:
Methods for settling disputes arising from petroleum contracts
Disputes arising from a petroleum contract must first be resolved by consultation and negotiation. In the event that no agreement is reached, these disputes may be settled through arbitration or court proceedings prescribed in the petroleum contract in accordance with the Law on Investment and other related laws.
Thus, disputes arising from a petroleum contract must first be resolved by consultation and negotiation. In the event that no agreement is reached, these disputes may be settled through arbitration or court proceedings as agreed upon by both parties when signing the contract.
The 2022 Petroleum Law of Vietnam takes effect from July 1, 2023.
Nguyễn Thị Hồng Nhung