The Government is to enact new legislation for the establishment of a Petroleum Development Authority and formulation of a National Policy on Upstream Petroleum Industry.
The new Bill which will replace the Petroleum Resources Act No. 26 of 2003 also provides for the regulation and management structure capturing the maximum economic value of domestic petroleum resources through modern exploration, development, production, and management practices in Sri Lanka.
The Petroleum Resources Bill has been published in the Gazette and will be presented to Parliament later this month.
The objective of the new legislation is to establish a Policy Advisory Committee to advise on formulation of a national policy for the upstream petroleum industry covering the exploration, development, production, and management of all petroleum resources in Sri Lanka.
It will also provide the legal framework to regulate all processes of the exploration, development, production, and management of all petroleum resources including the provision of operational guidelines.
Its other objectives are to establish an independent, efficient, and transparent regulatory framework in relation to the exploration, development, production, and management of petroleum resources in the country, manage the available petroleum resources in an equitable, safe, and environmentally sustainable manner and design, implement, monitor, and revise fiscal regimes that meet evolving economic needs of the country while providing fiscal stability to contractors.
The Petroleum Development Authority will be administered by a Board of Directors and will include five ex-officio members including the Director-General of the Authority who will be appointed by the Minister in charge of the subject with Cabinet approval, DG of the Public Utilities Commission, Chairman, Marine Environment Protection Authority as well as representatives of the three ministries including the Finance Ministry.
Its four other members will be appointed by the Minister in charge of the subject with Cabinet approval and will be persons who have achieved eminence in the field of upstream petroleum industry, whose qualifications shall be prescribed.
The Minister will also appoint a Policy Advisory Committee, in consultation with the Authority comprising experts in the fields of industry, commerce, law and any other subject, to advise on formulating the National Policy on Upstream Petroleum Industry.
The Authority will be vested to call for proposals for the conduct of petroleum operations in respect of defined exploration blocks in the Petroleum Resources Agreement.
The ownership of petroleum resources and petroleum data will be with the State.
(FT)