Petroleum Resource Rent Tax Assessment (Combination of Petroleum Projects–C036) Certificate 2018

Overview

The Petroleum Resource Rent Tax Assessment (Combination of Petroleum Projects–C036) Certificate 2018, issued by Senator the Hon Matthew Canavan, the Minister for Resources and Northern Australia, on 12 December 2018, provides a framework for the assessment of certain petroleum projects under the Petroleum Resource Rent Tax Assessment Act 1987. This certificate is designed to address issues arising from the combination of specific petroleum projects by specifying the production licenses involved and setting the legal basis for the assessment. The certificate commences on the day it is signed by the Minister, in line with section 20(6) of the Act, and is issued under section 20 of the Act itself. The certificate defines key terms and identifies the specified production licenses relevant to the assessment, namely PL1022 and PL1037, granted under the Petroleum and Gas (Production and Safety) Act 2004 (Qld). The underlying policy objective is to provide clarity and legal certainty regarding the assessment of combined petroleum projects, ensuring they are evaluated appropriately under the relevant taxation legislation.

Scope and Application

The Petroleum Resource Rent Tax Assessment (Combination of Petroleum Projects––C036) Certificate 2018, issued by Senator the Hon Matthew Canavan, Minister for Resources and Northern Australia, applies specifically to the assessment of petroleum resource rent tax in relation to the combination of certain petroleum projects. This certificate is applicable to the production licences PL1022 and PL1037 granted under the Petroleum and Gas (Production and Safety) Act 2004 (Qld). The certificate is issued under section 20 of the Petroleum Resource Rent Tax Assessment Act 1987 and comes into effect on the date it is signed by the Minister, as required by section 20(6) of the Act. While the certificate itself outlines the specific production licences it applies to, any broader application or exclusions are governed by the terms and provisions of the Petroleum Resource Rent Tax Assessment Act 1987. The certificate may also extend or restrict its application through any subordinate instruments issued under the authority of the Act.

Key Provisions

The Petroleum Resource Rent Tax Assessment (Combination of Petroleum Projects––C036) Certificate 2018, issued by Senator the Hon Matthew Canavan, Minister for Resources and Northern Australia, specifies the combination of certain petroleum projects under the Petroleum Resource Rent Tax Assessment Act 1987 (the Act) (s 2). This certificate is issued under section 20 of the Act and comes into force on the day it is signed by the Minister, in line with section 20(6) of the Act (s 2). The certificate identifies specific production licences, namely PL1022 and PL1037, which have been granted under the Petroleum and Gas (Production and Safety) Act 2004 (Qld) and are subject to the provisions of section 20 of the Act (s 5). Under the Act, certain obligations and requirements are imposed on the entities that hold these specified production licences. These obligations include the assessment of the petroleum resource rent tax (PRRT) for the combined projects, as outlined in section 20 of the Act. The Minister must ensure that the combination of the specified projects is assessed correctly for PRRT purposes, which includes taking into account the production, revenue, and other relevant factors of the combined projects (s 20). Additionally, the entities holding these licences must comply with all applicable provisions of the Act and any other relevant legislation. Failure to comply with the requirements of the Act or the terms of the certificate may result in various consequences. The Act provides for both civil and criminal penalties for breaches. For example, section 187 of the Act outlines that an entity may be liable for a penalty of up to $100,000 for each day of non-compliance, which could accumulate to significant amounts over time. Furthermore, section 190 of the Act allows for prosecution of individuals or entities that wilfully or negligently contravene the Act, which may result in a fine of up to $1,100,000 or imprisonment for up to five years, or both, for corporate entities. These penalties underscore the importance of adhering to the provisions of the Act and the certificate.