Amounts from petroleum operations that must be submitted to the state budget on an annual basis in Vietnam

Amounts from petroleum operations that must be submitted to the state budget on an annual basis in Vietnam (Internet image)

On July 1, 2023, the Government issued Decree 45/2023/ND-CP detailing a number of articles of the Petroleum Law.

1. Amounts from petroleum operations that must be submitted to the state budget on an annual basis in Vietnam

Specifically, in Clause 2, Article 37 of Decree 45/2023/ND-CP, submit the following amounts to the state budget on an annual basis:

- Remaining revenues after spending on purposes under Clause 1 of this Article;

- Remaining budget (if any) if total amount spent at the end of the period is lower than actual approved budget;

- Interests (if any) of remaining provisions that are allowed to be retained at the end of financial year;

- Remaining amount (if any) of guarantee fund for fulfillment of petroleum installation decommissioning obligations after decommissioning, determined by audit results as per the law;

- Surplus (if any) of revenues generated by liquidation of assets no longer useful for petroleum operations; equipment, instruments, materials, and wastes collected during petroleum installation decommissioning; legitimate, reasonable costs on a case-by-case basis.

2. The use of petroleum sales generated by petroleum operations in Vietnam

Pursuant to Clause 1, Article 37 of Decree 45/2023/ND-CP, petroleum sales generated by petroleum operations and other revenues (if any) shall be used for:

- Paying and disbursing legitimate, reasonable costs incurred during petroleum operations according to approved operation programs and budget;

- Paying estimated costs in subsequent period depending on approved operation programs and budget in advance;

- Covering additional investment to increase petroleum reserve, maintain petroleum mining productivity; contributing to guarantee fund for fulfillment of petroleum installation decommissioning obligations for work items of additional investment (if any).

3. Prohibited acts in the process of performance of fundamental investigations of petroleum and its operations in Vietnam

Prohibited acts in the process of performance of fundamental investigations of petroleum and its operations in Vietnam are specified in Article 9 of the Petroleum Law 2022 as follows:

- Carry out fundamental investigations of petroleum and its operations without permission of competent authorities.

- Take advantage of fundamental investigations of petroleum and its operations to affect national defense, security, national interests and legal interests of organizations and individuals; cause environmental pollution.

- Take advantage of fundamental investigations of petroleum and its operations to exploit other natural resources and minerals.

- Obstruct lawful activities in the process of performance of fundamental investigations of petroleum and its operations.

- Deliberately destroy assets, equipment and petroleum installations; destroy samples, information and data collected during the process of performance of fundamental investigations of petroleum and its operations.

- Illegally provide samples, information and data collected during the process of performance of fundamental investigations of petroleum and its operations.

- Be involved in corruption, cause losses and waste during the process of performance of fundamental investigations of petroleum and its operations.

More details can be found in Decree 45/2023/ND-CP, effective from July 1, 2023, replacing Decree 95/2015/ND-CP and Decree 33/2013/ND-CP.

Ho Quoc Tuan

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