PETROLEUM MINING CODE
FOR THE JOINT PETROLEUM
DEVELOPMENT AREA
Section 1 Interpretation 5
1.1 Definitions 5
1.2 Headings 9
1.3 Further Interpretation 9
1.4 Exercise by the Designated Authority of its Powers and Functions 9
Section 2 Graticulation of the Joint Petroleum Development Area 10
2.1 Sections and sub-Sections 10
2.2 Blocks and Sub-Blocks 11
Section 3 Geodetic Datum 11
3.1 Determining a position of a point in the JPDA 11
3.2 Using the World Geodetic System 84 11
Section 4 General Provisions 11
4.1 Prohibited without Authorisation 11
4.2 Acquisition of Title to Petroleum 11
4.3 Joint and Several Liability 12
4.4 Joint Operating and Other Agreements 12
4.5 Approval of Operator 12
4.6 Change in Control 12
4.7 Restrictions on Assignment 13
4.8 Indemnification of Designated Authority and Joint Commission 13
Section 5 Applications 14
5.1 Invitation 14
5.2 Content of Invitation 14
5.3 Applicant's Proposals in respect of Health, Safety and the Environment 15
5.4 Applicant's Proposals in respect of Training and Employment, and Local Goods and Services 15
5.5 Designated Authority to Consider Applications 15
5.6 False or Misleading Information in an Application 15
Section 6 Making of Production Sharing Contracts 16
6.1 Power of Designated Authority 16
6.2 Restrictions on Choice of a Contractor 16
Section 7 Rights and Obligations Conferred by Production Sharing Contract. 16
7.1 Principal Rights and Exclusivity 16
7.2 Mandatory Provisions 17
7.3 Other Provisions 17
7.4 Discovery of Petroleum 18
Section 8 Prospecting Authorisation 18
8.1 Grant 18
8.2 Notice to Other Persons 19
8.3 Surrender and Cancellation 19
Section 9 Access Authorisation 19
9.1 Grant 19
9.2 Notice to Other Persons 20
9.3 Surrender and Cancellation 21
9.4 Reports to Other Persons 21
9.5 Third Party Access 21
9.6 Directions 21
Section 10 Unitisation 22
10.1 Power of Designated Authority to Require Unitisation 22
10.2 Timing 22
10.3 Changes to Unitisation 22
Section 11 Additional Powers 22
11.1 Agreements with Other Persons 22
11.2 Exemptions by the Designated Authority 23
11.3 Approval of Joint Commission 23
Section 12 Work Practices 23
12.1 Proper and Workmanlike Manner 23
12.2 Particular Obligations 23
Section 13 Data and Information 24
13.1 Ownership of Data 24
13.2 Records and Reporting to the Designated Authority 24
Section 14 Release of Information and Data 25
14.1 Use of Data and Information 25
14.2 Confidentiality of Data and Information 25
14.3 Trade Secrets 25
14.4 Speculative Seismic Surveys 26
14.5 Public Announcement 26
Section 15 Inspections 26
15.1 Power of Appointment 26
15.2 Powers of Inspector 27
15.3 Powers of the Designated Authority 27
15.4 Provision of Facilities 27
15.5 Complaints 28
15.6 Inspector may be Accompanied 28
15.7 Inspector not to be Hindered 28
Section 16 Auditing 28
16.1 Audit 28
16.2 Independent Audit 28
Section 17 Investigations 28
17.1 Power of Designated Authority 28
17.2 Self-Incrimination no Excuse 29
17.3 Right to copy 29
17.4 Misleading Information 29
Section 18 Safety Zones 29
Section 19 Publication of Details of Authorisations 29
Section 20 Public Information 30
20.1 Authorisations and Other Documents 30
20.2 Decision-Making 30
20.3 Compliance Reports 30
20.4 Publication of Payments 30
20.5 Public Access 31
Section 21 Termination of Authorisations 31
21.1 Grounds for Termination 31
21.2 Designated Authority to give Notice 31
21.3 Generally 32
21.4 Partial Termination 32
Section 22 Regulations 32
22.1 Provisions in Regulations 32
22.2 Failure to Comply 34
Section 23 Directions 34
23.1 Issue Directions 34
23.2 Failure to Comply 35
Section 24 Removal of Property 35
Section 25 Arbitration 35
25.1 Settlement of Disputes 35
Section 26 Transitional Provision 35
26.1 Interim Petroleum Mining Code 35
JPDA PETROLEUM MINING CODE PREAMBLE
In accordance with Article 7(a) of the Timor Sea Treaty, and subject to the terms of that Treaty, the following Petroleum Mining Code is adopted to govern the exploration, development and exploitation of Petroleum within the JPDA, as well as the export of Petroleum from the JPDA.
PART I PRELIMINARY
Section 1 Interpretation
1.1 Definitions
In this Code:
“Access Authorisation” means an authorisation granted pursuant to Section 9.1;
“Affiliate” means, in respect of an Authorised Person, (or, if more than one person, in respect of each such person), a person that Controls, is Controlled by, or is under common Control with, the Authorised Person or any such person, as the case may be;
“Authorisation” means an Access Authorisation, a Production Sharing Contract or a Prospecting Authorisation, or an agreement (if any) made in respect of such an Authorisation or Production Sharing Contract;
“Authorised Activities” means the activities authorised by an Authorisation; “Authorised Area” means the area from time to time the subject of an Authorisation; “Authorised Person” means:
(a) in respect of a Production Sharing Contract, the Contractor; and
(b) in respect of any other Authorisation, the person to whom the Authorisation has been granted;
“Block” has the meaning in sub-Section 2.2;
“Calendar Year” means a period of twelve months commencing on January 1 and ending on the following December 31, according to the Gregorian calendar;
“Code” means this Petroleum Mining Code, as amended, modified or replaced from time to time, and regulations made and directions given under it;
“Commencement Date” means the date upon which the Joint Commission adopts this Code;
“Contract Area” means the Authorised Area from time to time the subject of a Production Sharing Contract;
“Contractor” means a person with whom the Designated Authority has made a Production Sharing Contract;
“Control” means, in relation to a person, the power of another person to secure:
(a) by means of the holding of shares or the possession of voting power, in or in relation to the first person or any other person; or
(b) by virtue of any power conferred by the articles of association of, or any other document regulating, the first person or any other person,
that the affairs of the first person are conducted in accordance with the wishes or directions of that other person;
“Crude Oil” means crude mineral oil and all liquid hydrocarbons in their natural state or obtained from Wet Gas by condensation or extraction;
“Designated Authority” means the Timor Sea Designated Authority for the JPDA established pursuant to Article 6 of the Treaty;
“Field Export Point” means:
(a) in circumstances where petroleum has gone through field level separation, is made ready for sale, further processing, or transportation and exported from the Contract Area by tanker - the point of tanker loading;
(b) in circumstances where petroleum has gone through field level separation, is made ready for sale, further processing, or transportation and exported from the Contract Area by pipeline - the inlet flange of the export pipeline;
(c) in circumstances where petroleum is processed beyond field level separation within the Contract Area - no later than the point at which the petroleum is input to such further processing; or
(d) such other point within the JPDA as approved in a development plan in accordance with an Authorisation;
“Good Oil Field Practice” means such practices and procedures employed in the petroleum industry worldwide by prudent and diligent operators under conditions and circumstances similar to those experienced in connection with the relevant aspect or aspects of the Petroleum Operations, having regard to relevant factors including:
(a) conservation of petroleum and gas resources, which includes the utilization of methods and processes to maximise the recovery of hydrocarbons in a technically and economically efficient manner, and to minimize losses at the surface;
(b) operational safety, which entails the use of methods and processes aimed at preventing major accident events and occupational health and safety incidents; and
(c) environmental protection, that calls for the adoption of methods and processes which minimize the impact of the Operations on the environment;
“Infrastructure Provider” has the meaning in sub-paragraph 9.1(a)(iii); “Insolvency Event” means:
(a) the Authorised Person is insolvent, is adjudged bankrupt or makes any assignment for the benefit of its creditors, or is adjudged to be unable to pay its debts as the same fall due;
(b) an application (other than a vexatious or frivolous application) to, or order is made by, a court having jurisdiction or, an effective resolution is made for the dissolution, liquidation or winding up of the Authorised Person and in the case of an application to a court, the application is not withdrawn or dismissed within thirty (30) days;
(c) a receiver is appointed or an encumbrancer or security holder takes possession of a majority of the assets or undertaking of the Authorised Person;
(d) the Authorised Person ceases or threatens to cease to carry on its business or execution is forced against all or a majority of the Authorised Person’s property and is not discharged or set aside within fourteen (14) days;
(e) an administrator is appointed or a resolution that an administrator be appointed to the Authorised Person is passed or any formal steps are taken to appoint an administrator to the Authorised Person; or
(f) the Authorised Person, without the consent of the Designated Authority, enters into, or resolves to enter into, an arrangement, compromise, or composition with any of, or any class of its creditors or members or process is filed in a court seeking approval of such arrangement, compromise or composition where the proposed arrangement, compromise or composition could, in the opinion of the Designated Authority, materially affect the ability of the Authorised Person to discharge its obligations under its Authorisation.
“Inspector” has the meaning in sub-Section 15.2;
“Interim Petroleum Mining Code” means the interim code governing the exploration, development and exploitation of petroleum within the JPDA, and adopted by the Joint Commission on 2 April 2003 pursuant to Article 7(b) of the Treaty;
“Joint Commission” means the Joint Commission for the JPDA established pursuant to Article 6 of the Treaty;
“Joint Operating Agreement” means any agreement or contract, among all of the Contractors with respect to their respective rights and obligations under a Production Sharing Contract;
“JPDA” means the Joint Petroleum Development Area established pursuant to Article 3 of the Treaty;
“Natural Gas” means all gaseous hydrocarbons and inerts, including wet mineral gas, dry mineral gas, casing head gas and residue gas remaining after the extraction of liquid hydrocarbons from Wet Gas;
“Operator” means the person appointed from time to time to organise and supervise Authorised Activities;
“Petroleum” means:
(a) any naturally occurring hydrocarbon, whether in a gaseous, liquid, or solid state;
(b) any naturally occurring mixture of hydrocarbons, whether in a gaseous, liquid or solid state; or
(c) any naturally occurring mixture of one or more hydrocarbons, whether in a gaseous, liquid or solid state, as well as other substances produced in association with such hydrocarbons;
and includes any petroleum as defined by paragraphs (a), (b) or (c) that has been returned to a Reservoir;
“Petroleum Operations” means any activity authorised by the Designated Authority, and includes:
(a) the exploration for, development and exploitation of Petroleum in the Contract Area, and the export of that Petroleum from the Contract Area;
(b) the construction, installation and operation of structures, facilities, installations, equipment and other property, and the carrying out of other works, necessary for the purposes mentioned in paragraph (a) above;
(c) Decommissioning, including removal of items referred to in paragraph (b) above;
(d) the marketing of that Petroleum; and
(e) planning and preparation for the activities mentioned in paragraphs (a), (b),
(c) and (d) above;
“Pipeline” means a pipe or system of pipes, and associated equipment, for exporting Petroleum from the JPDA, but not a field gathering or flow line;
“Production Sharing Contract” means a contract between the Designated Authority and a limited liability corporation or entity with limited liability under which production from a specified area of the JPDA is shared between the parties to the contract;
“Prospecting Authorisation” means an authorisation granted pursuant to Section 8;
“Reservoir” means a porous and permeable underground formation containing an individual and separate natural accumulation of producible hydrocarbons (oil and/or gas) that is confined by impermeable rock and/or water barriers and is characterized by a single natural pressure system;
“Sub-Block” has the meaning in sub-Section 2.2;
“Treaty” means the Timor Sea Treaty between the Government of Timor-Leste and the Government of Australia signed on 20th May 2002; and
“Wet Gas” means a mixture of hydrocarbons, inerts and impurities that is recoverable from a Reservoir and is gaseous at the conditions which its volume is measured or estimated.
1.2 Headings
As used herein, headings are for convenience and do not form a part of, and shall not affect the interpretation of, this Code.
1.3 Further Interpretation
In this Code, unless the contrary intention appears:
(a) the words “including” and “in particular” shall be construed as being by way of illustration or emphasis only, and shall not be construed as, nor shall they take effect as, limiting the generality of any preceding words;
(b) a reference to a Section, sub-Section, paragraph and sub-paragraph, is to a Section, sub-Section, paragraph and sub-paragraph of this Code;
(c) a reference to an agreement or instrument is to the same as amended, varied, novated, modified or replaced from time to time;
(d) an agreement includes an arrangement, whether or not having the force of law;
(e) a reference to the consent or approval of the Designated Authority means the consent or approval, in writing, of the Designated Authority and in accordance with the conditions of that consent or approval;
(f) “person” includes a corporation or other legal entity;
(g) the singular includes the plural, and vice versa;
(h) any gender includes the other; and
(i) where a word or expression is defined, cognate words and expressions shall be construed accordingly.
1.4 Exercise by the Designated Authority of its Powers and Functions
(a) The Designated Authority shall exercise its powers and discharge its functions under the Treaty, the Code and Authorisations in accordance with Good Oil Field Practice with a view to contributing to further investment in the JPDA and to the long-term development of Timor-Leste and Australia.
(b) Unless otherwise provided in this Code, before exercising any such power or discharging any such function, the Designated Authority shall, subject to paragraph 1.4(c):
(i) give opportunity to Authorised Persons, and others reasonably likely to be affected by the exercise of the power or by the discharge of the function to make representations to it; and
(ii) give consideration to representations received by it.
(c) The Designated Authority may exercise a power or discharge a function referred to in paragraph 1.4(a) without complying with the requirements of paragraph 1.4(c) where the Designated Authority considers that there are compelling reasons for doing so. Where the Designated Authority does exercise a power or discharge a function under this paragraph, it shall notify the Joint Commission within fourteen
(14) days of doing so.
(d) The forgoing provisions of this sub-Section 1.4 are without prejudice to the power of the Joint Commission, in Annex D of the Treaty, to give directions to the Designated Authority on the discharge of its powers and functions.
Section 2 Graticulation of the Joint Petroleum Development Area
2.1 Sections and sub-Sections
For the purposes of this Code:
(a) the surface of the Earth shall be divided:
(iii) by the meridian of Greenwich and by meridians that are at a distance from that meridian of five (5) minutes, or a multiple of five (5) minutes, of longitude; and
(iv) the equator and by parallels of latitude that are at a distance from the equator of five (5) minutes, or a multiple of five (5) minutes, of latitude;
into sections, each of which is bounded:
(v) by portions of two (2) of those meridians that are at a distance from each other of five (5) minutes of longitude; and
(vi) by portions of two (2) of those parallels of latitude that are at a distance from each other of five (5) minutes of latitude; and
(b) the surface of the Earth shall further be divided:
(i) by the meridian of Greenwich and by meridians that are at a distance from that meridian of one (1) minute, or a multiple of one (1) minute, of longitude; and
(ii) the equator and by parallels of latitude that are at a distance from the equator of one (1) minute, or a multiple of one (1) minute, of latitude;
into sub-sections, each of which is bounded:
(iii) by portions of two (2) of those meridians that are at a distance from each other of one (1) minute of longitude; and
(iv) by portions of two (2) of those parallels of latitude that are at a distance from each other of one (1) minute of latitude.
2.2 Blocks and Sub-Blocks
A section that is wholly or partly within the JPDA is a Block. A sub-section that is wholly or partly within the JPDA is a Sub-Block. The Designated Authority shall allocate an identifying number to each Block and Sub-Block. Where a Sub-Block is divided by depth, the Designated Authority shall allocate an identifying letter to each part.
Section 3 Geodetic Datum
3.1 Determining a position of a point in the JPDA
Whenever it is necessary to determine the position of a point in the JPDA, that position shall be determined by reference to a spheroid having its centre at the centre of the Earth and a major (equatorial) radius of 6378160 metres and a flattening of 100/29825 and by reference to the position of the Johnson Geodetic Station in the Northern Territory of Australia. The Johnson Geodetic Station shall be taken to be situated at 133 degrees, 12 minutes and 30.0771 seconds of East Longitude and at 25 degrees, 56 minutes and 54.5515 seconds of South Latitude and to have a ground level of 571.2 metres above the spheroid referred to above.
3.2 Using the World Geodetic System 84
For reasons of practicality, positions in the JPDA may be expressed by reference to the spheroid World Geodetic System 84 (WGS 84), which has its centre at the centre of the Earth and a major (equatorial) radius of 6378137 metres and a flattening of 100/29825.7223563. To transform geographic coordinates from the reference system mentioned in the previous paragraph to WGS 84, the Designated Authority shall resort to internationally recognised datum transformation parameters.
PART II AUTHORISATION OF ACTIVITIES
Section 4 General Provisions
4.1 Prohibited without Authorisation
(a) Except pursuant to an Authorisation, a person shall not explore for, develop or exploit Petroleum within the JPDA, nor export Petroleum from the JPDA.
(b) Paragraph 4.1(a) includes the construction, installation and operation of any structure, facility, installation, equipment or other property, and the carrying out of any other works, in the JPDA.
4.2 Acquisition of Title to Petroleum
A person shall not acquire title to Petroleum before it has been recovered from a Reservoir and delivered at the Field Export Point.
4.3 Joint and Several Liability
If there is more than one Authorised Person in respect of a particular Authorisation, the obligations and liabilities of the Authorised Person under an Authorisation are the obligations and liabilities of them all, jointly and severally.
4.4 Joint Operating and Other Agreements
(a) Except with the consent in writing of the Designated Authority and unless in accordance with the conditions of the consent, where any agreement (whether an agreement commonly referred to as a Joint Operating Agreement, or otherwise) is made by and between any two or more persons with respect to any share of:
(i) the rights, interests, benefits, obligations and liabilities of the Authorised Person under the Authorisation; or
(ii) any Petroleum, or any proceeds of sale of any Petroleum, which, at the time the agreement is made, has not been, but might be, produced from the Authorised Area,
the Designated Authority may terminate the Authorisation.
(b) Paragraph 4.4(a) does not apply to an agreement for the sale or exchange of Crude Oil where the sale or exchange occurs after title thereto has passed to the Authorised Person.
(c) A consent by the Designated Authority under this sub-Section 4.4 is without prejudice to sub-Section 4.3.
4.5 Approval of Operator
(a) The appointment of an Operator shall be subject to the prior approval of the Designated Authority where:
(i) there is more than one Authorised Person in respect of a particular Authorisation and the person appointed as Operator is one of those Authorised Persons, and
(ii) the person appointed as Operator is not an Authorised Person.
(b) Any change in Operator shall be subject to the prior approval of the Designated Authority.
(c) Where the Designated Authority determines that an Operator is no longer competent to be an Operator, the Designated Authority, with the approval of the Joint Commission, may, by written notice to the Operator and to the Authorised Person, revoke its approval.
4.6 Change in Control
(a) All changes in Control of an Authorised Person shall be subject to the prior approval of the Designated Authority.
(b) Where a change in Control occurs without the prior approval of the Designated Authority, the Designated Authority may terminate the applicable Authorisation.
(c) Paragraph 4.6(a) does not apply if the change in Control is the direct result of an acquisition of shares or other securities listed on a recognised stock exchange.
(d) For the purposes of this sub-Section 4.6, “change in Control” includes a person ceasing to be in Control (whether or not another person becomes in Control), and a person obtaining Control (whether or not another person was in Control).
4.7 Restrictions on Assignment
(a) Except with the consent in writing of the Designated Authority, and unless in accordance with the conditions of the consent, where an assignment or other dealing occurs in respect of an Authorisation by an Authorised Person the Designated Authority may terminate the Authorisation.
(b) Paragraph 4.7(a) includes any assignment, transfer, conveyance, novation, merger, encumbering or other dealing in any manner whatsoever or howsoever (whether legally, beneficially or otherwise, and whether conditionally or not) by an Authorised Person with:
(i) an Authorisation, or all or any part of its rights, interests, benefits, obligations and liabilities under it;
(ii) Petroleum which has not then been, but might be, recovered in the Contract Area, or any proceeds of sale of such Petroleum; and
(iii) anything whereby the Authorisation, that Petroleum or any of those rights, interests and benefits would, but for this sub-Section 4.7, be held for the benefit of, or be exercisable by or for the benefit of, any other person.
(c) Sub-paragraph 4.7(b)(ii) does not apply to an agreement for the sale or exchange of Crude Oil where the sale or exchange occurs after title thereto has passed to the Authorised Person.
(d) The Designated Authority may not consent to a dealing which would result in a person other than a limited liability corporation, or an entity with limited liability, specifically established for the sole purposes of the Production Sharing Contract, becoming a Contractor, and any consent otherwise is of no force or effect.
(e) For the purposes of paragraph 4.7(b), encumbrance includes any mortgage, charge, pledge, hypothecation, lien, assignment by way of security, title retention, option, right to acquire, right of pre-emption, right of set off, counterclaim, trust arrangement, overriding royalty, net profits interest, or any other security, preferential right, equity or restriction, any agreement to give or to create any of the forgoing and any transaction which, in legal terms, is not a secured borrowing but which has an economic or financial effect similar to that of a secured borrowing.
4.8 Indemnification of Designated Authority and Joint Commission
An Authorised Person shall:
(a) at all times defend, keep effectually indemnified and hold harmless the Designated Authority and the members of the Joint Commission against all actions, suits, proceedings, costs, charges, claims and demands whatsoever (including for economic loss) which may be made or brought against the Designated Authority and/or the members of the Joint Commission wheresoever by any third party in relation to or in connection with its Authorisation or resulting, directly or indirectly, from Authorised Activities under its Authorisation or any other matter or thing done or purported to be done in pursuance of that Authorisation or in the conduct of those Authorised Activities, notwithstanding that the Designated Authority and/or the members of the Joint Commission may have approved in any manner or form whatsoever thereof or that such may have been permitted or required by the terms of the Treaty, the Code (including any regulation made or direction given thereunder) or that Authorisation, or that the Designated Authority and/or the members of the Joint Commission could have exercised, but did not exercise, any power, function, right or authority to prohibit the same;
(b) unless the Designated Authority is satisfied from time to time, after consultation with the Authorised Person, that the potential liability under paragraph 4.8(a)can be covered by other means, including self-insurance, maintain insurance in respect thereof for such amount and on such terms as the Designated Authority requires from time to time; and
(c) take out and maintain insurance in respect of such other matters as the Designated Authority requires (including in respect of pollution), for such amounts as the Designated Authority requires from time to time and otherwise as required by Good Oil Field Practice, unless the Designated Authority is satisfied from time to time, after consultation with the Authorised Person, that the potential liability can be covered by other means, including self-insurance.
Section 5 Applications
5.1 Invitation
(a) The Designated Authority shall, by notice in official Timor-Leste and Australian Government gazettes, and in such other manner, if any, as it decides, from time to time invite applications to enter into an Authorisation.
(b) Notwithstanding paragraph 5.1 (a), the Designated Authority may, with the approval of the Joint Commission, elect to award Authorisations without issuing such invitations:
(i) in the case of Access Authorisations; or
(ii) in the case of all other Authorisations, where it is in the public interest to do so.
(c) if the Designated Authority grants an Authorisation without inviting applications, it shall publish a brief explanation of its reasons in a convenient manner.
5.2 Content of Invitation
An invitation mentioned in sub-Section 5.1 shall specify:
(a) the area concerned, and the activities the Designated Authority proposes to authorise in respect of it;
(b) the criteria upon which applications will be assessed;
(c) the time by which (not to be less than four (4) weeks), and the manner in which, applications may be made;
(d) the fees, if any, which are to accompany the application; and
(e) such other matters as the Designated Authority considers material or convenient to specify.
Unless the invitation specifically so states, the Designated Authority is not obliged to grant an Authorisation to any applicant.
5.3 Applicant's Proposals in respect of Health, Safety and the Environment
(a) An application for an Authorisation shall include proposals:
(i) for securing the health, safety and welfare of persons in or about the Authorised Activities; and
(ii) for protecting the natural and marine environment, and for preventing, minimising and remedying pollution and other environmental harm from the Authorised Activities.
(b) An Authorisation awarded to an applicant obliges it to comply with its proposals as mentioned in paragraph 5.3(a), but without prejudice to its obligation to comply with more stringent requirements (if any) in the Treaty, the Code, the Authorisation or Good Oil Field Practice.
5.4 Applicant's Proposals in respect of Training and Employment, and Local Goods and Services
An application for an Authorisation shall include proposals for:
(a) training, and, with due regard to occupational health and safety requirements, giving preference in employment in the Authorised Activities to nationals and permanent residents of Timor-Leste; and
(b) the acquisition of goods and services from persons based in Timor-Leste.
5.5 Designated Authority to Consider Applications
The Designated Authority may not grant an Authorisation in respect of an area to the extent to which applications in respect of that area have been invited, until all applications submitted in compliance with the terms of such invitation have finally been considered.
5.6 False or Misleading Information in an Application
The knowing or reckless giving of information that is false or misleading in a material respect in, or in connection with, any application under the Code, shall be grounds on which
the Designated Authority may terminate any Authorisation granted as a result of that application.
Section 6 Making of Production Sharing Contracts
6.1 Power of Designated Authority
The Designated Authority may, with the approval of the Joint Commission:
(a) subject to sub-Sections 6.2 and 5.5; and
(b) in respect of all or any part of the JPDA (subject to any other Production Sharing Contract authorising activities in that area);
make a Production Sharing Contract with any person.
6.2 Restrictions on Choice of a Contractor
(a) The Designated Authority may only make a Production Sharing Contract with a person, or group of persons, which:
(i) it is satisfied has, or has access to, the financial capability, and the technical knowledge and ability, to carry on the Petroleum Operations in a manner wholly consistent with the Treaty, the Code and the Production Sharing Contract; and
(ii) does not have a record of non-compliance with principles of good corporate citizenship; and
(iii) if a group, has made an agreement of a kind which, if the Production Sharing Contract were made with it, would be an agreement of the kind mentioned in sub-Section 4.4, and the Designated Authority has given its consent to the agreement and the group has agreed to act (and has acted and is acting) in accordance with the conditions (if any) of the consent.
(b) A Production Sharing Contract may only be made with a person which is a limited liability corporation or entity with limited liability, or with persons who are limited liability corporations or entities with limited liability, specifically established for the sole purpose of the Production Sharing Contract. A Production Sharing Contract made other than with such a person or persons, as the case may be, is of no force or effect.
(c) If a Contractor engages in a business other than the Authorised Activity, the Designated Authority may terminate the Production Sharing Contract.
Section 7 Rights and Obligations Conferred by Production Sharing Contract
7.1 Principal Rights and Exclusivity
(a) Subject to this Code, a Production Sharing Contract authorises the Contractor exclusively to explore for, develop and exploit Petroleum in the Contract Area, and to export that Petroleum from the JPDA.
(b) Paragraph 7.1(a) includes:
(i) the construction, installation and operation of structures, facilities, installations, equipment and other property, and the carrying out of other works, necessary for the purposes mentioned in it, in the Contract Area; and
(ii) the marketing of that Petroleum.
(c) Without limiting the generality of the forgoing provisions of this sub-Section 7.1, the Petroleum Operations may be limited to Crude Oil, Natural Gas or other constituents of Petroleum, and the Contract Area may be delineated vertically as well as horizontally.
7.2 Mandatory Provisions
A Production Sharing Contract obliges the Contractor to comply with its obligations under the Treaty and the Code. Subject thereto, the Production Sharing Contract shall:
(a) oblige the Contractor to fund the Petroleum Operations;
(b) oblige the Contractor to carry on the Petroleum Operations in accordance with programmes and budgets approved by the Designated Authority;
(c) oblige the Contractor periodically to submit to the Designated Authority, in respect of the Petroleum Operations, data, information, reports, assessments and plans;
(d) provide for the Contractor to share Petroleum from the Contract Area with the Designated Authority;
(e) permit the Contractor to lift, dispose of and export from the Contract Area, its share of Petroleum from the Contract Area, and (without prejudice to its obligations under the Treaty, the Code and the Contract) to retain the proceeds from the sale thereof;
(f) subject to sub-Section 4.2, specify the point or points at which title to the Contractor's share of Petroleum from the Contract Area will pass to it;
(g) oblige the Contractor, at the request of the Designated Authority, to lift, dispose of and export from the Contract Area, all or a portion of the Designated Authority's share of Petroleum on terms no less favourable to the Designated Authority than those which the Contractor receives for its own share, and to account to the Designated Authority for the value thereof;
(h) require the Contractor to provide for third party access to structures, facilities, installations, equipment and other property, and other works, constructed, installed or operated in the course of the Petroleum Operations on reasonable terms and conditions; and
(i) provide for disputes between the Designated Authority and the Contractor to be resolved by an independent tribunal.
7.3 Other Provisions
A Production Sharing Contract may:
(a) oblige the Contractor to carry out specified minimum levels of work and expenditure;
(b) provide for the periodic relinquishment of parts of the Contract Area;
(c) provide for the Contractor to maintain insurances in addition to those mentioned in sub-Section 4.8;
(d) provide for the consequences of a failure of the Contractor to fulfil its obligations under the Production Sharing Contract;
(e) oblige the Contractor to provide security for the funding and performance of its obligations under the Production Sharing Contract, including in respect of decommissioning;
(f) specify the actions, in addition to those mentioned in sub-Section 7.4, to be taken by the Designated Authority and the Contractor, on the discovery of Petroleum;
(g) oblige the Contractor to transfer title, to the Designated Authority, to structures, facilities, installations, equipment and other property, and to other works, constructed, installed or operated in the course of Petroleum Operations;
(h) provide that the Contract is a commercial agreement and that both the Designated Authority and the Contractor waive any claim to sovereign immunity which they may have, both as to process and execution; and
(i) provide for such other matters as may be convenient.
7.4 Discovery of Petroleum
A Contractor shall notify the Designated Authority in writing within twenty four (24) hours whenever any Petroleum is discovered in its Authorised Area, and shall provide such information in regard thereto as the Designated Authority may request, including details in writing of the chemical composition and physical properties of the Petroleum, and the nature of the sub-soil in which the Petroleum occurs.
Section 8 Prospecting Authorisation
8.1 Grant
(a) The Designated Authority may grant a Prospecting Authorisation to any person, subject to such conditions as the Designated Authority specifies in the Authorisation.
(b) Notwithstanding paragraph 8.1(a), a Prospecting Authorisation does not enable the holder of the Prospecting Authorisation to enter any part of the JPDA that is the subject of a Production Sharing Contract, without the written agreement of the Contractor, and such agreement shall not be unreasonably withheld.
(c) A Prospecting Authorisation, while it remains in force, authorises the holder to acquire data and other information for the purposes of exploration, in the area specified in the Prospecting Authorisation.
(d) Nothing in a Prospecting Authorisation authorises the holder to drill a well or to have any preference or right to make a Production Sharing Contract.
8.2 Notice to Other Persons
Where:
(a) a person holds a Prospecting Authorisation in respect of an area; and
(b) a Prospecting Authorisation is granted to another person in respect of that area;
the Designated Authority shall, by written notice served on each of those persons, inform them of:
(c) the Authorised Activities of the other; and
(d) the conditions to which the Prospecting Authorisation granted to the other is subject.
8.3 Surrender and Cancellation
A Prospecting Authorisation:
(a) may be surrendered by the holder at any time by instrument in writing served on the Designated Authority, provided that the Authorised Person has fulfilled all its obligations thereunder; and
(b) may, if the holder has not complied with a condition to which the Prospecting Authorisation is subject, be cancelled by the Designated Authority by instrument in writing served on the holder.
Section 9 Access Authorisation
9.1 Grant
(a) The Designated Authority may grant:
(i) a person wishing to undertake a survey to facilitate the, development or exploitation of Petroleum within the JPDA, or the export of Petroleum from the JPDA (in respect of all or a part of the JPDA);
(ii) with the approval of the Joint Commission in the case of a Contractor wishing to drill a well into a Reservoir that is within the Contract Area under its Production Sharing Contract, a Contractor (in respect of a part of the JPDA which is not within its Contract Area );
(iii) with the approval of the Joint Commission if in regard to a Pipeline, a person (an "Infrastructure Provider"), not being a Contractor, wishing to construct, install or operate, in the JPDA, structures, facilities, installations, equipment or other property, or carry out other works, development or exploitation of Petroleum within the JPDA, or the export of Petroleum from the JPDA (in respect of a part of the JPDA); or
(iv) an Access Authorisation, subject to such conditions as the Designated Authority thinks fit and specifies in the Access Authorisation;
(b) An Access Authorisation authorises the holder:
(i) if a Contractor, to carry on, in the area specified in the Access Authorisation, and in relation to the Petroleum Operations authorised by its Production Sharing Contract, the operations so specified (including the construction, installation and operation of structures, facilities, installation, equipment and other property, and the carrying out of other works);
(ii) if a person undertaking a survey, to carry on, in the area specified in the Access Authorisation, and in relation to the matters mentioned in sub- paragraph 9.1(a)(i), the operations so specified; and
(iii) if an Infrastructure Provider, to carry on, in the area specified in the Access Authorisation, and in relation to the matters mentioned in sub-paragraph 9.1(a)(iii), the operations so specified.
(c) Except in relation to a Contractor wishing to drill a well into a Reservoir that is within its Contract Area, nothing in an Access Authorisation authorises the holder to drill a well.
9.2 Notice to Other Persons
The Designated Authority may not grant an Access Authorisation with any person in respect of an area that is the subject of a Production Sharing Contract with, or a Prospecting Authorisation held by, another person, or vary an Access Authorisation in force in respect of such an area, unless:
(a) it has, by instrument in writing served on that other person, given not less than one
(1) month's notice of its intention to grant, or vary, as the case may be, the Access Authorisation;
(b) it has served a copy of the instrument:
(i) on such other persons as it thinks fit; and
(ii) in a case where it intends to vary an Access Authorisation, on the holder of the Access Authorisation;
(c) it has, in the instrument:
(i) given particulars of the Access Authorisation proposed to be granted, or of the variation proposed to be made, as the case may be; and
(ii) specified a date on or before which a person on whom the instrument, or a copy of the instrument, is served may, by instrument in writing served on the Designated Authority, submit any matters that it wishes the Designated Authority to consider; and
(d) it has taken into account any matters so submitted to it on or before the specified date by such a person in such a way that there is no undue interference with the
rights and obligations of that other person, and the terms are not inconsistent with general commercial practice in similar circumstances.
9.3 Surrender and Cancellation
(a) An Access Authorisation:
(i) may be surrendered by the holder at any time by instrument in writing served on the Designated Authority, provided that the Authorised Person has fulfilled all its obligations thereunder; and
(ii) may, if the holder has not complied with a condition to which the Access Authorisation is subject, be cancelled by the Designated Authority by instrument in writing served on the holder.
(b) The Designated Authority shall serve a copy of the instrument concerned on any Contractor or holder of a Prospecting Authorisation in whose Authorised Area operations were authorised to be carried on by the Access Authorisation concerned.
9.4 Reports to Other Persons
An Access Authorisation in respect of an area that is the subject of a Production Sharing Contract shall,
(a) to the extent that the Designated Authority is satisfied that it is right and proper to do so having regard to the operations authorised by the Access Authorisation and to the rights, interests, benefits, obligations and liabilities of the Contractor under the Production Sharing Contract, and
(b) having taking into account any matters submitted to it by the Contractor and those other persons mentioned in sub-Section 9.2,
require that the holder of the Access Authorisation furnish to the Contractor, at such times and in such manner as are specified in the Access Authorisation, such data, information and reports as are so specified.
9.5 Third Party Access
(a) The conditions to which an Access Authorisation granted to a Contractor or to an Infrastructure Provider are subject shall include conditions as to third party access to the structures, facilities, installations, equipment and other property, and other works concerned.
(b) Third-party access shall be on commercial terms and in accordance with Good Oil Field Practice.
9.6 Directions
The Designated Authority may give directions to the holders of Access Authorisations and to other Authorised Persons, regarding the coordination of their respective operations.
Section 10 Unitisation
10.1 Power of Designated Authority to Require Unitisation
(a) Where a Reservoir is partly within a Contract Area and partly within another Contract Area, but wholly within the JPDA, the Designated Authority may require by written notice the Contractors to enter into a unitisation agreement for the purpose of securing the more effective recovery of Petroleum from the Reservoir.
(b) If no agreement has been reached within a period of eighteen (18) months from receipt of written notice as required in paragraph 10.1(a), the Designated Authority shall, with the approval of the Joint Commission, determine the terms of the unitisation agreement.
(c) Where a Reservoir is partly within a Contract Area and partly within an area not the subject of a Production Sharing Contract, but wholly within the JPDA, the Designated Authority, with the approval of the Joint Commission, may require by written notice the Contractor to enter into a unitisation agreement with the Designated Authority for the purpose of securing the more effective recovery of Petroleum from the Reservoir. The unitisation agreement is subject to the approval of the Joint Commission.
(d) If no agreement has been reached within a period of eighteen (18) months from receipt of written notice as required in paragraph 10.1(c), an independent expert approved by the Contractor and the Designated Authority shall determine the terms of the unitisation agreement. In the absence of agreement on the choice of the independent expert within thirty (30) days, an expert shall be appointed by the Joint Commission at the request of either party.
10.2 Timing
Approvals for the development or exploitation of the Reservoir shall not be granted by the Designated Authority before the terms of the unitisation agreement are agreed or determined.
10.3 Changes to Unitisation
Any changes to the unitisation agreement shall be subject to the prior approval of the Designated Authority with the approval of the Joint Commission.
Section 11 Additional Powers
11.1 Agreements with Other Persons
The Designated Authority may make an agreement with a person with respect to any matter incidental to or connected with an Authorisation, including assurances to providers of finance to the Contractor regarding the exercise of the Designated Authority's power and functions in regard to assignments, termination and rates of production of Petroleum, as requested and agreed to by the Contractor.
11.2 Exemptions by the Designated Authority
Subject to sub-Section 11.3, the Designated Authority may, at the request of an Authorised Person, exempt that Authorised Person from complying with the conditions of its Authorisation, and may also agree to vary or suspend those conditions, either with or without conditions and either temporarily or permanently, except insofar as this would be inconsistent with the Treaty and this Code.
11.3 Approval of Joint Commission
The Designated Authority may not, without the approval of the Joint Commission, exempt an Authorised Person from complying with, or vary or suspend:
(a) any condition of a Production Sharing Contract; or
(b) any condition of an Authorisation in respect of a Pipeline.
PARTIII
CONDUCT OF AUTHORISED ACTIVITIES
Section 12 Work Practices
12.1 Proper and Workmanlike Manner
An Authorised Person shall carry out Authorised Activities in a proper, efficient and workmanlike manner, and in accordance with the Treaty and the Code, its Authorisation and Good Oil Field Practice.
12.2 Particular Obligations
In particular, an Authorised Person shall carry out Authorised Activities in such a manner as is required by sub-Section 12.1 to:
(a) protect the environment in and about the Authorised Area, ensure that Authorised Activities result in minimum ecological damage or destruction, and clean up pollution;
(b) ensure the health, safety and welfare of persons in or about the Authorised Activities;
(c) maintain in safe and good condition and repair, the Authorised Area and all structures, facilities, installations, equipment and other property, and other works, used or to be used, in Authorised Activities;
(d) manage the resources in a way that promotes further investment and contributes to the long term development of Timor-Leste and Australia;
(e) on the earlier of:
(i) termination of the Authorisation; and
(ii) when no longer required for Authorised Activities;
and, in either case:
(iii) except with the consent in writing of the Designated Authority and in accordance with the conditions of the consent; or
(iv) unless the Authorisation otherwise provides,
abandon, decommission, transfer, remove and/or dispose of all structures, facilities, installations, equipment and other property, clean up the Authorised Area and make it good and safe, and protect the environment, to the satisfaction of the Designated Authority.
PARTIV
INFORMATION AND INVESTIGATION
Section 13 Data and Information
13.1 Ownership of Data
(a) The Designated Authority shall have title to all technical data and information acquired in the course of, or as a result of, Authorised Activities.
(b) Paragraph 13.1(a) includes all raw data and information (including cores, cuttings, samples, and all other geological, geophysical, geochemical, drilling, well, production and engineering data and information) that the Authorised Person collects and compiles through Petroleum Operations. It does not include data obtained from special studies carried out by or for the Authorised Person that uses special proprietary software or procedures. It also does not include interpretations that have particular commercial or regional significance to a Contractor (over and above that which is necessary for the commercial evaluation and development of a Contract Area) and in respect of which the eligible recoverable cost attributable to the Contract Area is a small proportion of the total cost of the interpretations.
13.2 Records and Reporting to the Designated Authority
An Authorised Person shall, unless otherwise required by law:
(a) keep such financial, commercial, legal, operational, technical and other data, information and records relating to Authorised Activities (including the sale or other disposition of Petroleum, and the data and information mentioned in sub-Section 13.1) in such manner and at such place;
(b) make available to the Designated Authority such data, information and records in such manner and at such time and at such place; and
(c) provide the Designated Authority with such reports in respect thereof and otherwise in respect of Authorised Activities,
as the Designated Authority specifies.
Section 14 Release of Information and Data
14.1 Use of Data and Information
(a) The Designated Authority may make such use as it wishes of the data and information mentioned in Section 13, and nothing in sub-Sections 14.2 or 14.3 prevents the Designated Authority using data and information for the purposes of general statistical and other general reporting (publicly or otherwise) on its activities.
(b) Except with the consent in writing of the Designated Authority and in accordance with the conditions (if any) of the consent, the Authorised Person may only use the data and information mentioned in sub-Section 13.1 for its Authorised Activities or for an application for an Authorisation or for reporting information to its Affiliates provided that the Authorised Person first procures that any such Affiliates agree to be bound by this paragraph 14.1(b).
14.2 Confidentiality of Data and Information
(a) Except as otherwise provided in the Authorisation or with the consent of the Authorised Person, the Designated Authority shall not publicly disclose or, other than for the purpose of the administration of the Treaty or the Code, or as otherwise required by the Treaty or the Code, make available to any person, any data or information mentioned in sub-Section 13.1 until the earlier of:
(i) five (5) years after the data or information was acquired by the Authorised Person; and
(ii) the Authorisation under which the data or information was acquired ceasing to apply;
(b) Except with the consent of the Designated Authority, and in accordance with the conditions (if any) of the consent, an Authorised Person shall not disclose the data or information mentioned in sub-Section 13.1 other than:
(i) to its employees, agents, contractors and Affiliates to the extent necessary for the proper and efficient carrying on of its Authorised Activities;
(ii) as required by law;
(iii) for the purpose of the resolution of disputes under its Authorisation; or
(iv) as required by a recognised stock exchange.
(c) The Authorised Person shall procure that a person mentioned in sub-paragraph 14.2(b)(i) maintains the data and information disclosed to it confidential in the terms of this sub-Section 14.2.
14.3 Trade Secrets
(a) Except as otherwise provided in the Authorisation or with the consent of the Authorised Person, and notwithstanding sub-Sections 14.1 and 14.2, the Designated Authority shall not publicly disclose or, other than for the purpose of the administration of the Treaty or the Code, or as otherwise required by the Treaty or
the Code, make available to any person, any data or information submitted to it by an Authorised Person which:
(i) is a trade secret of, or other data and information the disclosure of which would, or could reasonably be expected to, adversely affect, the Authorised Person in respect of its lawful business, commercial or financial affairs; and
(ii) was clearly marked as such when it was submitted to the Designated Authority.
(b) Without prejudice to sub-paragraph 14.3(a)(i):
(i) the Designated Authority may, at any time and from time to time, serve notice on an Authorised Person requiring it to show cause, within the time specified for the purpose in the notice, why information which it has marked pursuant to sub-paragraph 14.3(a)(ii) above should still be considered a trade secret or other information as mentioned in that sub-paragraph 14.3(a)(ii); and
(ii) if the Authorised Person does not show cause within that time, the data and information shall no longer be a trade secret or other such information for the purposes of this sub-Section 14.3.
14.4 Speculative Seismic Surveys
The Designated Authority may, in an agreement of a type as is mentioned in sub-Section 11.1, agree longer periods of confidentiality with a person wishing to engage in a speculative seismic survey where it is the intention of that person to sell the data and information acquired on a non-exclusive basis.
14.5 Public Announcement
Except with the consent of the Designated Authority and in accordance with the conditions (if any) of the consent, subject to law and/or the rules of an established stock exchange, an Authorised Person shall not make any public statement about its Authorisation or the results of its Authorised Activities. In no event shall such a public statement state or imply that the Designated Authority approves or agrees with its contents.
Section 15 Inspections
15.1 Power of Appointment
(a) The Designated Authority may, by instrument in writing, appoint a person to be an inspector for the purposes of the Code.
(b) An inspector must possess qualifications and experience that are appropriate to the areas of duty of that Inspector.
(c) An inspector is required to be bound by strict confidentiality provisions and must have no conflicts of interest in respect of duties undertaken.
15.2 Powers of Inspector
A person so appointed may, at all reasonable times and on production of the appropriate credentials:
(a) enter any area, structure, vehicle, vessel, aircraft or building in the JPDA that, in their opinion, has been, is being or is to be used for or in connection with the Authorised Activities or the furnishing of information mentioned in sub-Section 17.1 or in which, in their opinion, there may be documents or records relating to such activities;
(b) inspect and test any machinery or equipment that has been, is being, or is to be, used in Petroleum Operations in the JPDA;
(c) within the JPDA, take or remove, for the purpose of analysis or testing, or for use in evidence, samples of Petroleum, water or other substances;
(d) inspect, take extracts from and make copies of, any document, book or other record relating to, or which in his opinion might relate to, such activities or matters; and
(e) make inquiries concerning compliance with the provisions of the Code and Authorisation, and any direction issued, restrictions imposed or orders made under the Code.
15.3 Powers of the Designated Authority
The Designated Authority may;
(a) with respect to the health, safety and welfare of persons in or about such activities in the JPDA, issue directions to, and impose restrictions on, the Authorised Person or any person so engaged;
(b) order, by instrument in writing:
(i) the cessation of operations on or in, and the withdrawal of any person from, any area, structure, facility, installation or other works in the JPDA that is being used in connection with such activities; or
(ii) the discontinuance of the use of any machinery or equipment in the JPDA;
which it considers unsafe, unless and until such action as is necessary for safety and specified in the instrument is taken and completed.
15.4 Provision of Facilities
An Authorised Person and any person who is the occupier or person in charge of any structure, facility, installation, works or place, or the person in charge of any vehicle, vessel, aircraft, machinery or equipment referred to in sub-Section 15.2 shall provide an inspector with all reasonable facilities and assistance (including, if an Authorised Person and the inspector requires access to its offshore facilities, the provision of necessary means of transport) that the inspector requests for the effective exercise of his powers.
15.5 Complaints
(a) A person aggrieved by an action of an inspector under Section 15 may complain in writing to the Designated Authority, which shall as soon as practicable consider the complaint.
(b) The Designated Authority may take such reasonable action as is necessary in response to the complaint.
15.6 Inspector may be Accompanied
An inspector may be accompanied by any person who has written authorisation from the Designated Authority and who the Designated Authority believes has special or expert knowledge of any matter being investigated, tested or examined.
15.7 Inspector not to be Hindered
An Authorised Person shall not:
(a) hinder an inspector in the exercise of their powers under this Code;
(b) make a statement or produce a document that is false or misleading in a material aspect to an inspector engaged in carrying out his duties and functions; or
(c) withhold any information from an inspector without lawful excuse.
Section 16 Auditing
16.1 Audit
An Authorised Person's books and accounts shall be audited at such times and in such manner as may be provided in this Code and its Authorisation.
16.2 Independent Audit
Notwithstanding sub-Section 16.1, at the written request of the Designated Authority, an Authorised Person shall arrange for, and pay for, an independent audit of its activities under its Authorisation. There shall be a period of at least twelve (12) months between independent audits except in the case of manifest error or fraud.
Section 17 Investigations
17.1 Power of Designated Authority
Where the Designated Authority has reason to believe that an Authorised Person in the JPDA, Australia or Timor-Leste is capable of giving information or producing or making available documents or records relating to Authorised Activities which have been, or are being, carried on, it may, by instrument in writing served on that Authorised Person, give to that person a direction:
(a) to furnish to it in writing, within the period and in the manner specified in the instrument, any such information;
(b) requiring a senior representative of the Authorised Person, with decision making authority in relation to the issue under investigation, to meet with it, or with any person specified in the instrument, at such time and place as is so specified and there to answer questions and discuss issues relating to those matters; or
(c) to make available to it or a person specified in the instrument, at such time and place as is so specified, such documents or records.
17.2 Self-Incrimination no Excuse
An Authorised Person shall not be excused from furnishing information on the grounds that the information might tend to incriminate that person unless the information is likely to be admissible in evidence against that person in criminal proceedings in Australia.
17.3 Right to copy
Where documents or records are made available pursuant to a requirement under this Section 17, the Designated Authority or the inspector may make copies of, or take extracts from, them.
17.4 Misleading Information
An Authorised Person who, in purported compliance with a direction under sub-Section 17.1, provides or permits to be provided any information which is false or misleading in a material respect shall have failed to comply with that direction.
PART V SAFETY ZONES
Section 18 Safety Zones
To promote the safety of navigation and Authorised Activities, the Designated Authority may, consistent with international law, declare safety zones around structures, installations equipment and other property, and other works, in the JPDA. The Designated Authority may also require the installation, maintenance and provision of such navigation, fog and illumination lighting, acoustic and other devices and equipment as it considers necessary for the safety of Authorised Activities.
PARTVI
PUBLIC INFORMATION
Section 19 Publication of Details of Authorisations
The Designated Authority shall publish, in official Australian and Timor-Leste Government gazettes, summary details of Authorisations made or terminated in part or in whole.
Section 20 Public Information
20.1 Authorisations and Other Documents
(a) The Designated Authority shall make available to the public copies of all Authorisations and amendments thereto, whether or not terminated within thirty (30) days of their conclusion.
(b) The Designated Authority shall make available to the public, within a reasonable period of time of a request having been made therefor, summary details of:
(i) an approved Development Plan;
(ii) the original Authorised Area and all changes thereto;
(iii) the original Authorised Person (and, if a group, the undivided participating interest of each member of the group) and the identity of the Operator, and all changes thereto;
(iv) subject to commercial confidence as to the commercial terms, all assignments and other dealings consented to in respect thereof; and
(v) all unitisation agreements and determinations.
20.2 Decision-Making
Within ten (10) business days of a request having been made, the Designated Authority shall publish brief reasons for:
(a) granting an Authorisation subsequent to an invitation, as contemplated at paragraph 5.1(a);
(b) granting an Authorisation without inviting applications, as contemplated at paragraph 5.1(b);
(c) approving a Development Plan;
(d) granting an exemption from, or agreeing to a variation or suspension of, the conditions of an Authorisation under sub-Section 11.2; and
(e) making any decision or granting any approval that, under an Authorisation, requires publication.
20.3 Compliance Reports
(a) Authorised Persons shall report on their compliance with requirements under the Code and Authorisations in such manner and detail as required by their Authorisation and as provided by regulation.
(b) The Designated Authority shall make available such reports to the public.
20.4 Publication of Payments
The Designated Authority shall, in such a manner and detail as prescribed, publish payments made to the Designated Authority under an Authorisation.
20.5 Public Access
The information contemplated in this Section 20 shall be available to any person at all convenient times and the Designated Authority may require payment of a fee therefor.
PART VIII TERMINATION
Section 21 Termination of Authorisations
21.1 Grounds for Termination
(a) Where an Authorised Person:
(i) has not complied with a condition or term to which an Authorisation is subject;
(ii) has not complied with this Code;
(iii) has knowingly provided false information to the Designated Authority in connection with an Authorisation;
(iv) has not paid any amount payable by it under this Code or under an Authorisation within a period of three (3) months after the day on which the amount became payable; or
(v) is subject to or commits an Insolvency Event,
the Designated Authority may, with the approval of the Joint Commission, on that ground, by instrument in writing served on the Authorised Person terminate the Authorisation.
(b) The Designated Authority shall not terminate the Authorisation due to one or more of the relevant grounds identified in sub-paragraphs 21.1(a)(i) –(iv) unless there has been a material breach by the Authorised Person of one of those grounds.
(c) Where this Code or an Authorisation expressly grants the Designated Authority a right to terminate an Authorisation, that right shall be exercised in compliance with the requirements of this Section 21.
21.2 Designated Authority to give Notice
Except in relation to an Insolvency Event, in which case the Designated Authority may terminate an Authorisation forthwith, the Designated Authority shall not terminate an Authorisation unless:
(a) it has, by instrument in writing served on the Authorised Person, given not less than thirty (30) days notice of its intention to so cancel the Authorisation;
(b) it has, in the instrument, specified a date on or before which the Authorised Person may submit in writing to the Designated Authority any matters that it wishes to be considered; and
(c) it has taken into account any information provided under paragraph 21.2(b) and any action taken by the Authorised Person or other parties to remove that ground or to prevent the recurrence of similar grounds.
21.3 Generally
Termination of an Authorisation for any reason (including the passage of time) is without prejudice to rights and obligations expressed in the Code or the Authorisation to survive termination, or to rights and obligations accrued thereunder prior to termination, and all provisions of an Authorisation reasonably necessary for the full enjoyment and enforcement of those rights and obligations survive termination for the period necessary.
21.4 Partial Termination
If the Authorised Person is more than one Authorised Person in respect of a particular Authorisation and circumstances arise in which the Designated Authority may terminate an Authorisation, the Designated Authority may:
(a) elect to terminate an Authorisation only in respect of those Authorised Persons whose acts or omissions (or in relation to whom acts, omissions or events have occurred which) have led to such circumstances, and shall so notify the remaining Authorised Persons; or
(b) allow other Authorised Persons to remedy the breach of the defaulter to the satisfaction of the Designated Authority.
PART IX MISCELLANEOUS
Section 22 Regulations
22.1 Provisions in Regulations
(a) The Designated Authority, with the approval of the Joint Commission, may make regulations prescribing all matters that by the Code are required or permitted to be prescribed or are necessary or convenient to be prescribed for carrying out or giving effect to the Code.
(b) Without limiting the generality of paragraph 22.1(a), the regulations may make provision for all or any of the following matters:
(i) the exploration for Petroleum and the carrying on of operations, and the execution of works, for that purpose;
(ii) the production of Petroleum (including the rate at which it is recovered) and the carrying on of operations, and the execution of works, for that purpose;
(iii) the measurement and sale or disposal of the Designated Authority's and a Contractor's Petroleum, and the carrying on of operations for that purpose;
(iv) the conservation, and prevention of the waste, of natural resources, whether Petroleum or otherwise;
(v) the construction, erection, maintenance, operation, use, inspection, certification and re-certification of structures, facilities, installations, other works, equipment and other property;
(vi) the control of the flow or discharge, and the prevention of the escape, of Petroleum, water or drilling fluid, or a mixture of water and drilling fluid with Petroleum or any other matter;
(vii) the clean-up or other remedying of the effects of the escape of Petroleum;
(viii) the prevention of damage to Petroleum-bearing strata;
(ix) the prevention of waste or escape of Petroleum;
(x) the abandonment, decommissioning, removal and disposal of structures, facilities, installations, equipment and other property, and of other works, used or held for use in Authorised Activities and the cleaning up of Authorised Areas, including steps required to prevent hazard to human life, property and the environment;
(xi) the carrying on of Authorised Activities in a safe and environmentally sound manner;
(xii) the preparation of assessments of the impact of Authorised Activities on the environment;
(xiii) the authorisation by the Designated Authority of entry into the JPDA by the employees of Authorised Persons and the employees of their sub-contractors;
(xiv) the control of movement into, within and out of the JPDA of vessels, aircraft, structures, facilities, installations, equipment and other property used or held for use in Authorised Activities;
(xv) the actions, in addition to those mentioned in sub-Section 7.4, to be taken by the Designated Authority and the Contractor on the discovery of Petroleum;
(xvi) the content and information to be provided in respect of programmes and budgets requiring the prior approval of the Designated Authority;
(xvii) the control of tariffs charged for the use of structures, facilities, installations and other works, and the conditions of such use;
(xviii) the auditing of an Authorised Person and of its accounts and records;
(xix) reporting by Authorised Persons on compliance with proposals set out in this Code and Authorisations, including in relation to
(aa) the training and employment of Timor-Leste nationals, (bb) procurement of Timor-Leste goods and services,
(cc) occupational health and safety, and (dd) environmental protection.
(xx) fees, to be paid to the Designated Authority, in order to cover the costs of its activities (any changes in fees shall not be made to apply retrospectively). These include fees to be paid by:
(aa) applicants for Authorisations; (bb) Authorised Persons; and
(cc) persons wishing to inspect the register mentioned in sub-Section 20.1;
(xxi) the publication of payments made by an Authorised Person to the Designated Authority under an Authorisation; and
(xxii) any other matters relating to the Code.
(c) The power under this Section 22 to make regulations may be exercised:
(i) either in relation to all cases to which the power extends, or in relation to all of those cases subject to specified exceptions, or in relation to any specified cases or classes of cases; and
(ii) so as to make, as respects the cases in relation to which it is exercised: (aa) the same provision for all those cases, a different provision for
different cases or classes of cases, or different provisions as respects
the same case or classes of case for different purposes of the Code; or
(bb) any such provision either unconditionally or subject to any specified condition.
(d) The Designated Authority may, by instrument in writing served on a person or a class of person, make a regulation on a matter consistent with the forgoing provisions of this sub-Section 22.1 to apply to that person or class of persons.
22.2 Failure to Comply
(a) Where a person fails or neglects to comply with a regulation, the Designated Authority may cause to be done all or any of the things required by the regulation to be done.
(b) Costs and expenses incurred by the Designated Authority under paragraph 22.2(a) shall be a debt due to the Designated Authority by the person to whom the regulation was given and may be recovered in a court of competent jurisdiction.
Section 23 Directions
23.1 Issue Directions
(a) The Designated Authority may, by instrument in writing served on an Authorised Person, give to that person a direction as to any matter with respect to which regulations may be made under Section 22, or as otherwise provided in the Code.
(b) Directions given by the Designated Authority under sub-Section 23.1 are subject to any regulations made under Section 22.
23.2 Failure to Comply
(a) Where a person fails or neglects to comply with a direction given to it under sub- Section 23.1, the Designated Authority may cause to be done all or any of the things required by the direction to be done.
(b) Costs and expenses incurred by the Designated Authority under sub-Section 23.1 in relation to a direction shall be a debt due to the Designated Authority by the person to whom the direction was given and may be recovered in a court of competent jurisdiction.
Section 24 Removal of Property
(a) Without prejudice to the generality of sub-Section 23.2, where an Authorised Person fails or neglects to comply with a direction to remove and dispose of property from an Authorised Area, the Designated Authority may remove all or any of the property, and dispose of all or any of it in any manner it thinks fit (including by sale, whether at public auction or otherwise).
(b) The Designated Authority may deduct from the proceeds of any sale of any such property all or any part of any costs and expenses incurred by it under sub-Sections
22.2 and 23.2 in relation to that property and any other amounts owed to the Designated Authority by the Authorised Person pursuant to the Treaty, the Code or an Authorisation.
Section 25 Arbitration
25.1 Settlement of Disputes
(a) Any dispute between Timor-Leste and Australia concerning the interpretation or application of the Code shall, as far as practicable, be settled by consultation or negotiation.
(b) Any dispute which is not settled in the manner set out in paragraph 25.1(a) shall, at the request or Timor-Leste or Australia, be submitted to an arbitral panel in accordance with the procedure set out in Annex B to the Treaty.
Section 26 Transitional Provision
26.1 Interim Petroleum Mining Code
(a) This Code shall commence on, and the Interim Petroleum Mining Code shall be repealed from, the Commencement Date.
(b) Notwithstanding paragraph 26.1(a), the Interim Petroleum Mining Code, as in force immediately before the Commencement Date, continues to apply in relation to production sharing contracts numbered 03-12, 03-13, 03-19 and 03-20.