UNITISATION OF PETROLEUM FIELDS UNDER THE PSLA

Abstract

Unitisation is a commercial agreement between the titleholders of a shared petroleum pool that extends across two (or more) title boundaries.In 1998, a working group involving government and industry representatives was formed, with the intent of drafting a guideline on unitisation. However, work on the guideline was put on hold until after resolution of the Perseus Athena unitisation issue. During the intervening period, a number of new unitisation cases have arisen and a further number are on the horizon.A workshop was held in Perth on 22 February 2001 to canvass opinions and options on unitisation. Around 30 representatives from government (Commonwealth, Western Australia, Victoria, Northern Territory and the Timor Gap Joint Authority) and industry (APPEA, Agip, Apache, BHP, ExxonMobil, MIMI, Phillips, Santos, Shell and Woodside) attended and contributed to the Workshop.There is general agreement among industry and government representatives that there is a range of unitisation issues under the Petroleum (Submerged Lands) Act 1967 (PSLA) that need to be clarified. In response, the Commonwealth is examining those parts of the Act that deal with property rights with respect to shared pools and when government should direct unitisation. This could lead to changes to the PSLA depending on consultations with interested parties on these matters.The aim of this paper is to canvas a number of options with regards to property rights and government direction. These options could also help resolve a range of other issues relating to unitisation, including information sharing and secondary taxation of unitised fields.