38ENotice of intention to cancel lease

#### 38E Notice of intention to cancel lease (1) Where: (a) a lessee has been given a notice of the kind referred to in paragraph 38H(3)(b) during the term of the lease and has carried out, and has informed the Designated Authority of the results of, the re‑evaluation required by the notice; (b) the lessee has not made an application for the renewal of the lease; and (c) after consideration of the results of the re‑evaluation referred to in paragraph (a) and such other matters as the Joint Authority thinks fit, the Joint Authority is of the opinion that recovery of petroleum from the lease area is commercially viable; the Joint Authority may serve on the lessee and on such other persons as the Joint Authority thinks appropriate an instrument in writing: (d) informing the lessee or the other person that the Joint Authority has formed that opinion and that the Joint Authority intends to cancel the lease; and (e) stating that the lessee or the other person may serve an instrument in writing on the Designated Authority within the period specified in the first‑mentioned instrument, not being a period ending earlier than one month after the date of service of the first‑mentioned instrument, setting out any matters that the lessee or the other person, as the case may be, wishes to be considered. (2) Where: (a) an instrument under subsection (1) is served on a lessee; and (b) the lessee does not, within the period referred to in paragraph (1)(e), serve on the Designated Authority an instrument setting out matters that the lessee wishes to be considered or the Joint Authority, after consideration of matters set out in an instrument served on the Designated Authority by the lessee within that period, determines that the lease should be cancelled; the Joint Authority shall, by instrument in writing served on the lessee, cancel the lease. (3) The cancellation of a lease under subsection (2) has effect: (a) in a case to which paragraph (b) does not apply—at the end of the period of 12 months commencing on the date of service of the instrument of cancellation; or (b) in a case where the lessee makes an application for a licence in respect of one or more of the blocks comprised in the lease within the period referred to in paragraph (a)—when the Joint Authority grants, or refuses to grant, the licence or when the application lapses, whichever first happens. (4) Where a lease is cancelled under subsection (2), the lease shall be deemed to continue in force in all respects until the cancellation has effect in accordance with subsection (3).