Law amending and supplementing the Law on Petroleum in 2000 of Vietnam: Term of a petroleum contract

Specifically, according to Clause 5 Article 1 of the Law amending and supplementing the Law on Petroleum in 2000 of Vietnam, the term of a petroleum contract is specified as follows:

- The term of a petroleum contract shall not exceed twenty five (25) years, of which the prospection and exploration period shall not exceed five (5) years.

- For petroleum investment promotion projects and natural gas prospection, exploration and exploitation projects, the term of petroleum contracts shall not exceed thirty (30) years, of which the prospection and exploration period shall not exceed seven (7) years.

- The term of a petroleum contract may be extended, but for not more than five (5) years. The prospection and exploration period may also be extended, but for not more than two (2) years.

- If discovering gas with commercial value, while lacking the consumption market as well as conditions on pipelines and suitable treatment facilities, contractors may retain the areas where gas is found. The duration of retention of such an area shall not exceed five (5) years and may, in special cases, be extended for two (2) more years. Pending the consumption market and the conditions on pipelines and suitable treatment facilities, the contractors shall have to proceed with the work already committed in the petroleum contracts.

- In force majeure circumstances or other special cases, the parties to a petroleum contract may agree upon the mode of temporary cessation of the exercise and performance of a number of rights and obligations specified in the petroleum contract. The temporary cessation period due to force majeure circumstances shall last till the disappearance of such force majeure events. The temporary cessation period in other special cases shall be specified by the Vietnamese Government, but it must not exceed three (3) years.

- The extended prospection and exploration period, the period of retention of the area where gas with commercial value is found and the period of temporary cessation of the exercise and performance of a number of rights and obligations in a petroleum contract in force majeure circumstances or in other special cases shall not be counted into the term of such petroleum contract.

- A petroleum contract may be terminated ahead of time provided that the contractor has fulfilled its committed obligations and such termination is agreed upon by the contractual parties.

View more details: The Law amending and supplementing the Law on Petroleum in 2000 takes effect from July 01, 2000.

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