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Energy Bill


Energy Bill
Part 3 — Decommissioning of energy installations
Chapter 3 — Oil and gas installations

54

 

(4)   

But if a notice under subsection (1) requires information in connection

with a function of the Secretary of State under section 107(1) or (4), the

notice may require the provision of information or documents which

the Secretary of State considers are necessary or expedient for the

purpose of exercising those functions (whether or not they are of a kind

5

specified in subsection (3)).

(5)   

A notice under subsection (1) must specify the documents or

information, or the description of documents or information, to which

it relates.

(6)   

Information or documents required to be provided under this section

10

must be provided within such period as is specified in the notice under

subsection (1).

(7)   

In this section, “associated”, in relation to a body corporate, is to be

construed in accordance with section 105A(3) to (8).

(8)   

A person who fails, without reasonable excuse, to comply with a notice

15

under subsection (1) is guilty of an offence.

(9)   

A person who discloses information obtained by virtue of a notice

under this section is guilty of an offence unless the disclosure—

(a)   

is made with the consent of the person by or on behalf of whom

the information was provided,

20

(b)   

is for the purpose of the exercise of the Secretary of State’s

functions under this Chapter, the Electricity Act 1989 or Part 4

of the Petroleum Act 1998, or

(c)   

is required by or under an enactment.”

Chapter 3

25

Oil and gas installations

67      

Persons who may be required to submit abandonment programmes

(1)   

Section 30 of the Petroleum Act 1998 (c. 17) (persons who may be required to

submit programmes) is amended as follows.

(2)   

In subsection (1)—

30

(a)   

after paragraph (b) insert—

“(ba)   

a person to whom subsection (5)(a) and (b) applied in

relation to the installation, but who—

(i)   

transferred the right mentioned in that

subsection to another person, and

35

(ii)   

has not obtained a consent required under the

licence in relation to the transfer;”, and

(b)   

in paragraph (e) for “company” in each place substitute “body

corporate”.

(3)   

In subsection (2)(c) for “company” in each place substitute “body corporate”.

40

(4)   

For subsection (5)(b) substitute—

“(b)   

either—

 
 

Energy Bill
Part 3 — Decommissioning of energy installations
Chapter 3 — Oil and gas installations

55

 

(i)   

any activity mentioned in subsection (6) is carried on

from, by means of or on the installation, or

(ii)   

the person intends to carry on an activity mentioned in

that subsection from, by means of or on the

installation,”.

5

(5)   

For subsection (8) substitute—

“(8)   

For the purposes of this section, one body corporate is associated with

another if one of them controls the other or a third body corporate

controls both of them; and subsections (8A) to (8D) set out the

circumstances in which one body corporate (“A”) controls another

10

(“B”).

(8A)   

Where B is a company, A controls B if A possesses or is entitled to

acquire—

(a)   

one half or more of the issued share capital of B,

(b)   

such rights as would entitle A to exercise one half or more of the

15

votes exercisable in general meetings of B,

(c)   

such part of the issued share capital of B as would entitle A to

one half or more of the amount distributed if the whole of the

income of B were in fact distributed among the shareholders, or

(d)   

such rights as would, in the event of the winding up of B or in

20

any other circumstances, entitle it to receive one half or more of

the assets of B which would then be available for distribution

among the shareholders.

(8B)   

Where B is a limited liability partnership, A controls B if A—

(a)   

holds a majority of the voting rights in B,

25

(b)   

is a member of B and has a right to appoint or remove a majority

of other members, or

(c)   

is a member of B and controls alone, or pursuant to an

agreement with other members, a majority of the voting rights

in B.

30

(8C)   

In subsection (8B)(a) and (c) the references to “voting rights” are to the

rights conferred on members in respect of their interest in a limited

liability partnership to vote on those matters which are to be decided

on by a vote of the members of the limited liability partnership.

(8D)   

In any case, A controls B if A has the power, directly or indirectly, to

35

secure that the affairs of B are conducted in accordance with A’s

wishes.”

(6)   

In subsection (9)—

(a)   

for “subsection (8)” substitute “subsections (8) to (8D)”, and

(b)   

for “company” in each place substitute “body corporate”.

40

68      

Financial resources etc

(1)   

Section 38 of the Petroleum Act 1998 (c. 17) (information and notices) is

amended as follows.

 
 

Energy Bill
Part 3 — Decommissioning of energy installations
Chapter 3 — Oil and gas installations

56

 

(2)   

For subsection (1) substitute—

“(1)   

The Secretary of State may, for a purpose specified in subsection (1A),

give a notice to a person within subsection (1B) requiring the person,

within a time specified in the notice—

(a)   

to provide specified information relating to the person’s

5

financial affairs;

(b)   

to supply copies of specified documents, or documents of a

specified description, relating to those affairs.

(1A)   

Those purposes are—

(a)   

determining whether to give a notice under section 29 to a

10

person in respect of an installation or pipeline;

(b)   

determining whether to make a proposal under section 34(1) to

impose a duty on a person under section 36;

(c)   

where a person has made such a proposal, determining whether

to impose the duty on the person proposed.

15

(1B)   

A person falls within this subsection if—

(a)   

a notice under section 29(1) may be given to the person,

(b)   

the person falls within section 34(2)(a) or (b) and the Secretary

of State is considering proposing, in accordance with section

34(1)(b), that the person should have a duty under section 36, or

20

(c)   

the person falls within section 34(2)(a) or (b) and the Secretary

of State is considering whether to impose a duty on the person

under section 36 in accordance with a proposal made under

section 34(1)(b).”

(3)   

In subsection (2)—

25

(a)   

for the words from “who has” to “that duty” substitute “falling within

subsection (2A) will be capable of carrying out any abandonment

programme which has been submitted (whether or not it is approved)

or may be submitted in relation to an installation or pipeline”, and

(b)   

in paragraph (a) after “information” insert “(which may relate to the

30

estimated costs of abandonment of the installation or pipeline or to any

other financial or other matter)”.

(4)   

After that subsection insert—

“(2A)   

A person falls within this subsection if—

(a)   

a notice under section 29(1) has been given to the person, or

35

(b)   

the person has a duty under section 36 to secure that an

abandonment programme is carried out.”

(5)   

For subsection (4) substitute—

“(4)   

The Secretary of State may, after consulting the Treasury, give written

notice to a person to whom subsection (4A) applies, requiring the

40

person to take such action as may be specified in the notice within such

time as may be so specified.

(4A)   

This subsection applies to a person if—

(a)   

the person falls within subsection (2A), and

(b)   

the Secretary of State is not satisfied that the person will be

45

capable of carrying out any duty which has been, or is likely to

be, imposed on the person by section 36.”

 
 

Energy Bill
Part 3 — Decommissioning of energy installations
Chapter 3 — Oil and gas installations

57

 

(6)   

After subsection (6) add—

“(7)   

It is an offence for a person to disclose information obtained by virtue

of a notice under subsection (1) or (2) unless the disclosure—

(a)   

is made with the consent of the person by or on behalf of whom

the information was provided,

5

(b)   

is for the purpose of the exercise of the Secretary of State’s

functions under this Part, Chapter 3 of Part 2 of the Energy Act

2004 or Part 1 of the Energy Act 2008, or

(c)   

is required by or under an enactment.”

69      

Protection of abandonment funds from creditors

10

(1)   

After section 38 of the Petroleum Act 1998 (c. 17) insert—

“38A    

Protection of funds set aside for the purposes of abandonment

programme

(1)   

This section applies where any security for the performance of

obligations under an approved abandonment programme has been

15

provided by a person (“the security provider”) by way of a trust or

other arrangements.

(2)   

Subsection (1) applies whether the security is provided before or after

the programme is approved.

(3)   

In this section a reference to “the protected assets” is a reference to the

20

security, and any property or rights in which it consists.

(4)   

The manner in which, and purposes for which the protected assets are

to be applied and enforceable (whether in the event of the security

provider’s insolvency or otherwise) is to be determined in accordance

with the trust or other arrangements.

25

(5)   

For the purposes of subsection (4), no regard is to be had to so much of

the Insolvency Act 1986, the Insolvency (Northern Ireland) Order 1989

or any other enactment or rule of law as, in its operation in relation to

the security provider or any conduct of the security provider, would—

(a)   

prevent or restrict the protected assets being applied in

30

accordance with the trust or other arrangement, or

(b)   

prevent or restrict their enforcement for the purposes of being

so applied.

(6)   

In subsection (5) “enactment” includes an enactment comprised in, or

in an instrument made under, an Act of the Scottish Parliament.

35

38B     

Directions to provide information about protected assets

(1)   

The Secretary of State may direct a security provider to publish

specified information about the protected assets.

(2)   

A direction under this section may specify—

(a)   

the time when the information must be published, and

40

(b)   

the manner of publication.

(3)   

If a security provider fails to comply with a direction, the Secretary of

State, or a creditor of the security provider, may make an application to

the court under this section.

 
 

Energy Bill
Part 3 — Decommissioning of energy installations
Chapter 4 — Wells

58

 

(4)   

If, on an application under this section, the court decides that the

security provider has failed to comply with the direction, it may order

the security provider to take such steps as the court directs for securing

that the direction is complied with.

(5)   

In this section—

5

“court”—

(a)   

in relation to an application in England and Wales or

Northern Ireland, means the High Court, and

(b)   

in relation to an application in Scotland, means the

Court of Session;

10

“security provider” means a person who has provided security in

relation to which section 38A applies;

“the protected assets”, in relation to a security provider, means the

security, and any property or rights in which it consists.”

(2)   

This section has effect in relation to a trust or other arrangements established

15

on or after 1st December 2007.

Chapter 4

Wells

70      

Information about decommissioning of wells

(1)   

In Part 5 of the Petroleum Act 1998 (c. 17), before section 46 (Northern Ireland

20

and Isle of Man shares of petroleum revenue) insert—

“45A    

Abandoned wells

(1)   

This section applies in relation to a person who has drilled, or

commenced drilling, a well in pursuance of a petroleum licence or a

licence under section 3 of the Energy Act 2008 (gas storage and

25

unloading licences).

(2)   

The Secretary of State may give a notice requiring the person—

(a)   

to provide specified information relating to the person’s

financial affairs, or

(b)   

to supply copies of specified documents, or documents of a

30

specified description, relating to those affairs.

(3)   

A notice under subsection (2) must specify the time within which the

information or documents must be provided.

(4)   

Subsection (5) applies if—

(a)   

the person fails to provide information or documents required

35

by such a notice within the period specified in the notice, or

(b)   

on receiving information or documents required by a notice

under subsection (2) the Secretary of State is not satisfied that

the person will be capable of plugging and abandoning the well.

(5)   

Where this subsection applies the Secretary of State may give the

40

person a notice, after consulting the Treasury, requiring the person to

take the action specified in the notice within the time so specified.

 
 

Energy Bill
Part 4 — Provisions relating to oil and gas

59

 

(6)   

The Secretary of State may not give a notice to a person under

subsection (5) without first giving the person an opportunity to make

written representations as to whether the notice should be given.

(7)   

It is an offence for a person to fail to comply with a notice under

subsection (2) or (5) unless it is proved that the person exercised due

5

diligence to avoid the failure.

(8)   

A person guilty of an offence under this section is liable—

(a)   

on summary conviction, to a fine not exceeding the statutory

maximum, or

(b)   

on conviction on indictment, to imprisonment for a term not

10

exceeding 2 years or to a fine, or both.

(9)   

Section 41 (other than subsection (5)) applies in relation to prosecutions

for offences under this section as it applies in relation to prosecutions

for offences under Part 4.

(10)   

In this section—

15

“petroleum licence” means a licence under section 2 of the

Petroleum (Production) Act 1934 or section 3 above;

“well” includes a borehole.”

(2)   

This section applies in relation to any well the drilling of which commences on

or after the date on which this section comes into force.

20

Part 4

Provisions relating to oil and gas

Petroleum licences

71      

Transfers without the consent of the Secretary of State

After section 5 of the Petroleum Act 1998 (c. 17) (existing licences) insert—

25

“5A     

Rights transferred without the consent of Secretary of State

(1)   

This section applies if—

(a)   

a person is (or two or more persons are) the licensee in respect

of a licence under section 2 of the Petroleum (Production) Act

1934 (c. 36) or section 3 above (“the transferor”),

30

(b)   

the transferor transfers a right granted by the licence, or derived

from a right so granted, to another person (“the transferee”)

after commencement in circumstances where the consent of the

Secretary of State is required for the transfer, and

(c)   

that consent is not obtained.

35

(2)   

The Secretary of State may, by notice given to the transferor and the

transferee, direct that the right is to revert to the transferor from a date

specified in the notice.

(3)   

The date specified must not be earlier than the date on which the notice

is given.

40

(4)   

Before giving a notice to a person under subsection (2), the Secretary of

State must—

 
 

Energy Bill
Part 4 — Provisions relating to oil and gas

60

 

(a)   

notify the person of the proposal to give the notice, and

(b)   

give the person a reasonable period within which to make

written representations.

(5)   

The Secretary of State may not give a notice under subsection (2) after

the end of the period of 3 months beginning with the date on which the

5

Secretary of State learns of the transfer.

(6)   

In this section—

“commencement” means the time when this section comes into

force;

“transfer” does not include a transfer by way of security for a loan.

10

5B      

Information

(1)   

The Commissioners for Her Majesty’s Revenue and Customs may

disclose to the Secretary of State information relating to the transfer of

a right granted by a licence under section 2 of the Petroleum

(Production) Act 1934 or section 3 above, or derived from a right so

15

granted, for the purpose of enabling the Secretary of State to determine

whether a transfer to which section 5A applies has taken place.

(2)   

This section applies despite any statutory or other restriction on the

disclosure of information.

(3)   

Information disclosed under this section must not be further disclosed

20

except—

(a)   

for the purpose mentioned in subsection (1), with the consent

(which may be general or specific) of the Commissioners,

(b)   

in pursuance of an order of a court, or

(c)   

with the consent of each person to whom the information

25

relates.

(4)   

A person who discloses information contrary to subsection (3) commits

an offence if the identity of the person to whom the information

relates—

(a)   

is specified in the disclosure, or

30

(b)   

can be deduced from it.

(5)   

It is a defence for a person charged with an offence under this section

to prove that the person reasonably believed that—

(a)   

the disclosure was lawful, or

(b)   

the information had already and lawfully been made available

35

to the public.

(6)   

A person guilty of an offence under this section is liable—

(a)   

on summary conviction, to imprisonment for a term not

exceeding 12 months or to a fine not exceeding the statutory

maximum, or both, and

40

(b)   

on conviction on indictment, to imprisonment for a term not

exceeding 2 years or to a fine, or both.

5C      

Offences under section 5B: supplemental

(1)   

No proceedings for an offence under section 5B may be instituted in

England and Wales except—

45

(a)   

by the Director of Revenue and Customs Prosecutions, or

 
 

 
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