House of Reps Public Hearing 1 – OPTS

  • Aggressive relinquishment – post-production license too aggressive and should be limited to 50% of acreage
  • Dormant fields – concerns around the “retroactive” provisions regarding dormant fields and a recommendation that it should only apply after the passage of the Bill;
  • Domestic crude supply obligation – there should be no DCSO and crude purchase in the domestic market should be commercially negotiated;
  • Segregation of the operating sectors – delineation of the sectors should take into account existing investments and should only apply to new investments;
  • Gas flaring provisions are too penal and will not achieve the intended goal of ending flaring;
  • Excessive power of the Commission – the powers of the Commission are excessive in some areas
  • Total MD fully supportive of the efforts to eliminate gas flaring through the various projects which they have recently commissioned. They are however concerned about the punitive nature of the Bill’s provisions and would recommend the encouragement of the development of infrastructure to bring gas to the market. He also recommended that safety and emergency flaring be removed from the punitive provisions.
  • Chevron MD concerned about the provisions relating to the delineation of the sectors by the Commission.
  • Exxon Mobil MD raised concerns around acreage management.  The length of term of the exploration period of 5 years is too short and should be increased to 7 years. The provisions relating to dormant fields should apply to fields discovered after  the passage of the bill. The provisions relating to post-production acreage relinquishment too aggressive.
  • NAOC MD concerned about the excessive powers of the Commission. In particular the power to impose penalties. Concerned about tariff methodology and worried about alleged lack of consultation. Penalties do not appear to take into account the severity of the infringement.

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