38BCGrant or refusal of lease in relation to application by licensee

#### 38BC Grant or refusal of lease in relation to application by licensee (1) If: (a) an application has been made under section 38BB; and (b) the applicant has given any further information as and when required by the Designated Authority under subsection 38BB(3); and (c) the Joint Authority is satisfied that recovery of petroleum from the unused area: (i) is not, at the time of the application, commercially viable; and (ii) is likely to become commercially viable within the period of 15 years after that time; the Joint Authority must, by written notice served on the applicant, inform the applicant that it is prepared to grant to the applicant a lease in respect of the unused area. (2) If an application has been made under section 38BB and: (a) the applicant has not given further information as and when required by the Designated Authority under subsection 38BB(3); or (b) the Joint Authority is not satisfied as to the matters referred to in paragraph (1)(c) in relation to the unused area; the Joint Authority must, by written notice served on the applicant, refuse to grant a lease to the applicant. (3) A notice under subsection (1) must contain: (a) a summary of the conditions subject to which the lease is to be granted; and (b) a statement to the effect that the application will lapse if the applicant does not make a request under subsection (4) in respect of the grant of the lease. (4) An applicant on whom a notice has been served under subsection (1) may, within one month after the date on which the notice was served, or within such further period, not exceeding one month, as the Designated Authority, on written application made to the Designated Authority before the end of the first‑mentioned period of one month, allows, request the Joint Authority in writing to grant the lease to the applicant. (5) If an applicant on whom a notice has been served under subsection (1) has made a request under subsection (4) within the period applicable under subsection (4), the Joint Authority must grant to the applicant a retention lease in respect of the unused area. (6) If an applicant on whom a notice has been served under subsection (1) has not made a request under subsection (4) within the period applicable under subsection (4), the application lapses at the end of that period. (7) On the day on which a lease granted under this section in respect of an unused area comes into force, the licence in respect of the block or blocks of which the area consists or in which the area is included ceases to be in force in respect of the area.