PETROLEUM (SUBMERGED LANDS) REGULATIONS 1987

The regulations adopt several key concepts from the Petroleum (Submerged Lands) Act 1981 without defining them. A “title” under the Act includes an exploration permit, a retention lease, a production licence, and a pipeline licence. The regulations tie fees to these titles by reference to “blocks” for permits, leases and production licences, and to “kilometres” for pipeline licences. A block is a standard subdivision of an offshore area under the Act, and the fee formulas in regulations 8, 9 and 10 multiply the number of blocks held at the start of the relevant year by a per-block rate. The concept of a “dealing” is central to regulations 3 and 4. A dealing includes any transaction that transfers, creates, varies or extinguishes an interest in a title, and it must be approved by the Minister and registered in the Register kept under the Act. Regulation 4 introduces the related concept of a “related dealing”: an earlier transaction between some or all parties that creates or assigns an option or right to enter into the main dealing, or that is altered or terminated by it. This requires disclosure of the same level of detail as the main dealing (instrument description, parties, values, and registration numbers). Another key concept is the “revenue unit”, used in Schedule 2 and regulation 5. The regulations do not define the term; its value is set by the Interpretation Act or another instrument. Because the fee amounts in Schedule 2 are expressed in revenue units rather than fixed dollar values, they automatically adjust when the revenue unit value changes, insulating the government from inflation erosion without further amending regulations. By contrast, the annual fees in regulations 8 to 11 and the security amounts in regulation 6 are fixed in dollars and require a formal amendment to change. The “GST component” in regulation 12 is a separate concept: it adds a percentage to annual fees for periods after 30 June 2000, calculated as one-tenth of the annual fee multiplied by the fraction of the year after that date, reflecting the introduction of the Commonwealth goods and services tax.

The regulations primarily affect corporations and other entities that hold, apply for, or deal in offshore petroleum titles in Northern Territory coastal waters. This includes major oil and gas companies, joint venture participants, and smaller exploration companies. Specifically, any person who lodges an application for an exploration permit (section 21(1)(f)), retention lease (section 24(1)(a)), production licence (section 30(2)(c)), or pipeline licence (section 38A(2)(e)) must pay the respective fee prescribed in Schedule 2. Any registered holder of such a title must pay the annual fee set out in regulation 8, 9, 10 or 11 for each year the title remains in force. Any party that seeks to transfer a title or register a dealing (such as an assignment of an interest, a mortgage, or a surrender) must pay the relevant fee under section 79 (transfer), section 92 (registration of dealings), or section 111 (consent to variation). The fees under section 92 vary by complexity: 857 revenue units for a straightforward registration, 4,285 revenue units for a dealing that triggers the market value provisions under section 92(4) or (7). The regulations also affect any person who requests access to documents, cores, cuttings or samples held by the Designated Authority under section 118 of the Act. That person must pay the loan, search, copying and forwarding fees in regulation 7. The security amounts in regulation 6 bind titleholders who must lodge a bank guarantee or other security under section 114(1)(a) as a condition of grant. An exploration permit or retention lease holder must provide $30,000; a production licence holder must provide $300,000; and a pipeline licence holder must provide $120,000. These amounts are modest relative to the capital costs of offshore operations but represent a non-trivial compliance cost for small players. The NT Government, through its Designated Authority, is the recipient of all fees and the beneficiary of the securities, and must determine the revenue unit value annually to apply the Schedule 2 fees.

The regulations impose a duty on any person who lodges a document or makes an application under a provision listed in Schedule 2 to pay the fee specified. The duty is strict: the Act likely conditions the acceptance or registration of the document on payment, and the regulations simply quantify that obligation. Similarly, every holder of an exploration permit, retention lease, production licence or pipeline licence must pay the annual fee under regulation 8, 9, 10 or 11, with the GST increment under regulation 12 added for periods after 30 June 2000. The Designated Authority has the right to charge that additional amount separately and require payment within one month. A person who transfers a title under section 78 must use the form set out in Schedule 1, which includes fields for the names of transferor and transferee, the type and number of the title, the consideration or value, and execution by seal or signature. A person lodging a notice of a dealing under section 81(4)(b) must supply all particulars listed in regulation 4(1), including description and date of the instrument, title details, full names and business addresses of parties, the effect of the dealing on registration, pre and post registration interests, value of consideration or interest (if applicable), whether an application under section 92(7) has been made or proposed, and details of any related dealing. The right to access information and physical samples under section 118 is qualified by regulation 7: the applicant must pay the loan fee of 35 revenue units per day or part day, the search fee of 35 revenue units per hour after the first half-hour, and the full cost of copying, reproduction, forwarding or consignment including packaging. The Designated Authority also has the right to require security under section 114(1)(a) in the amounts prescribed by regulation 6 before granting or approving certain titles. Importantly, the regulations do not create any right to a refund if an application is withdrawn or rejected; the Act would govern that, and the regulations are silent. Nor do they prescribe any grace period for late payment of annual fees; the Act presumably allows suspension or cancellation, but the regulations do not address it.

The regulations themselves do not create penalty provisions. They are purely prescriptive: they set amounts, forms, and particulars. Any enforcement of non-payment of fees or failure to provide the prescribed particulars flows from the Petroleum (Submerged Lands) Act 1981 itself, not from these regulations. Under the Act, a failure to pay an annual fee may result in the suspension or cancellation of the title, though the regulations do not specify the procedure or timing. Similarly, a failure to provide the prescribed particulars under regulation 4 for a dealing might lead the Minister or Designated Authority to refuse to register that dealing, leaving the transfer or mortgage ineffective against the title. The security amounts in regulation 6 are conditions precedent to grant; if a permittee fails to provide the required security, the Minister may not approve the grant. The regulations thus operate as gatekeepers: without the fee or security, the right cannot be obtained or maintained. There is no criminal penalty for non-payment; the consequence is administrative (refusal or forfeiture). For the GST component under regulation 12, the additional amount is payable within one month after the charge is made; if not paid, the Designated Authority may treat the annual fee as unpaid, with the same consequences. The regulations also do not prescribe interest on late payments, though the Act might. The precision of the revenue unit system in Schedule 2 creates a risk if the revenue unit value changes during the period between lodgement and processing; the regulations do not state that the fee is the fee at the date of payment or at the date of lodgement. The Designated Authority’s discretion to charge the full costs of copying and forwarding under regulation 7 is open-ended, being “an amount equal to all costs incurred”, which could include internal labour costs or only external costs; the lack of a ceiling or itemisation creates potential for dispute. Because the regulations rely on the Act for enforcement powers, a titleholder contesting a fee demand would need to challenge the underlying Act provision rather than the regulation itself.

The regulations are made under the Petroleum (Submerged Lands) Act 1981 (NT) and have no independent existence outside that Act. Their interpretation is governed by the Interpretation Act 1978 (NT), which defines “revenue unit” and sets the formula for its current value. The regulations also interact with the Commonwealth A New Tax System (Goods and Services Tax) Act 1999, because regulation 12 incorporates the definition of “GST” from that Act and uses it to add a component to annual fees. This is a rare example of a Northern Territory regulation directly adopting a Commonwealth tax law definition. The form of transfer in Schedule 1 interacts with the general law of property and contract. It requires the transferor to “transfer all right, title and interest” in the title, which likely operates as a statutory assignment under the Act, overriding any common law requirement for a deed. The form also requires insertion of the value of consideration or a reference to a prior dealing; this ties into the Act’s provisions on market value under section 92, which may trigger stamp duty implications under the Stamp Duty Act (NT). However, the regulations do not themselves impose stamp duty or require evidence of stamping. The interaction with the Petroleum (Submerged Lands) Act is direct: every cross-referenced section in the regulations (sections 21, 24, 30, 38A, 38F, 41, 48, 51, 54, 64, 71, 78, 79, 81, 86, 87, 92, 111, 114, 118, and 138) forms part of the primary Act, and the regulations supply only the missing detail (amounts, forms, particulars). The regulations do not interact with Commonwealth offshore petroleum laws because the NT Act applies to coastal waters within the territory’s jurisdiction, not the Commonwealth’s offshore area. However, a titleholder operating across both jurisdictions may need to comply with separate regulations in each. The regulations also do not interact with environmental or safety legislation, though the Petroleum (Submerged Lands) Act contains provisions that do, and the fees collected may fund regulatory activities in those areas.

The regulations were first made as SL No. 3, 1987, notified on 11 February 1987 and commenced the same day. They originally contained only regulations 1 and 2 (citation and form of transfer) plus Schedule 1. The entire structure of fees and security amounts was inserted by SL No. 69, 1991, which added regulations 3 to 12, substituted Schedule 1, and inserted Schedule 2. That amendment, notified on 18 December 1991, commenced the same day. SL No. 41, 1995, notified on 19 December 1995, amended regulations 8 to 11 to increase the annual fee amounts: exploration permit fee from $1,400 to $1,500 (or $78 to $84 per block), retention lease fee from $11,237 to $12,075 per block, production licence fee from $16,750 to $18,000 per block, and pipeline licence fee from $112 to $120 per kilometre. These changes took effect from 19 December 1995. SL No. 36, 2000, notified on 30 June 2000 and commenced the same day, inserted regulation 12 to add the GST component for annual fees payable after 30 June 2000. This was a one-time adjustment, not a periodic indexation mechanism. The most recent substantive amendment was SL No. 14, 2013, notified on 29 May 2013 and commencing 1 July 2013. That amendment substituted the whole of Schedule 2, replacing fixed dollar amounts with revenue units (e.g., section 21(1)(f) fee changed from $4,285 to 4,285 revenue units; section 24(1)(a) similarly). It also amended regulations 5 and 7 to change the fees under sections 86, 87, and 118: the section 86(1) fee became 19 revenue units (from a dollar amount), the section 87(3) fee became 28 revenue units, and the loan and search fees under section 118 became 35 revenue units per day or hour. Additionally, regulations 8 to 11 were amended by SL No. 14, 2013, but the amendment record shows only that the amendment changed the dollar amounts? The endnotes indicate SL No. 14, 2013 amended rr 5-11 and r 5; r 5 was amended by No. 14, 2013, but the current text shows r 5 still uses revenue units for s86(1) and 87(3) and $5.75 per page for s87(2). So the 2013 amendment likely converted some dollar fees to revenue units but left others unchanged. The endnotes also show general amendments by the Interpretation Legislation Amendment Act 2018 (Act No. 22, 2018) of a formal nature to regulation 1 and Schedule 1, likely updating citations or formatting. The regulations as in force at 1 July 2013 are the version provided.

The text of the regulations contains no reference to any litigation. There is no case law cited in the source material, and the regulations are essentially mechanical in nature. Reported challenges to administrative decisions under the Petroleum (Submerged Lands) Act 1981 (NT) could include disputes over fee amounts, refusal to register a dealing due to insufficient particulars under regulation 4, or imposition of the GST component. However, no such cases appear in the source provided. In practice, litigation over fee amounts is rare because the amounts are small relative to the value of the titles, and the regulations leave little room for discretion: the Designated Authority simply demands the prescribed fee. Disputes over the registration of dealings might arise if a party argues that the particulars provided under regulation 4 were adequate but the Authority rejected them without cause. In such a case, the Administrative Review Act (NT) might allow merits review of the decision not to register, but that would depend on the Act’s provisions, not the regulations. The security amounts in regulation 6 are fixed and unlikely to be litigated, though a challenge could be mounted if the Designated Authority purported to require a higher amount than prescribed. Similarly, the loan and search fees under regulation 7 could be disputed if the Authority’s calculation of “all costs incurred” for copying or forwarding appears unreasonable, but again the quantum is small. The regulations do not create any private rights of action; they are administrative in character. The lack of litigation history is consistent with the regulations’ function as a price list and form template, rather than a source of substantive legal obligation. No case names or citations are given in the source, and no inference can be drawn beyond the text itself.

Several features of the regulations could catch the unwary. First, the annual fees in regulations 8 to 11 are fixed in dollars and are not indexed to inflation or revenue units. The Schedule 2 fees, by contrast, are in revenue units and adjust automatically. This means the real value of the annual fees erodes over time until the next amendment, while application fees maintain their real value. A permittee reviewing the regulations in 2013 would see the dollar amounts last set in 1995 (for the per-block and per-kilometre rates) and cannot assume they will be updated regularly. Second, the GST component in regulation 12 applies only to annual fees (permit, lease, licence fees) and not to the application or registration fees in Schedule 2, nor to the security amounts. A titleholder paying an annual fee after 30 June 2000 must calculate the GST component separately if the Designated Authority does not itemise it. The formula uses a fraction (AF/10) x (GST period/366), where GST period is the number of days after 30 June 2000. For a full year after that date, the GST component is simply the annual fee divided by 10. However, if the fee year straddles 30 June 2000, only the post-30 June portion attracts the component, requiring a pro-rata calculation. Third, the “related dealing” definition in regulation 4(2) is broad. It catches any earlier transaction between some or all parties that creates or assigns an option or right to enter into the main dealing, or is altered or terminated by it. This extends to dealings registered before 3 September 1986. A party lodging a dealing must disclose all related dealings, even if they appear to be separate transactions, or risk having the registration delayed or rejected. Fourth, the form of transfer in Schedule 1 requires insertion of “the value of the consideration for the transfer or the value of the title transferred”. The regulation does not specify whether GST-inclusive or exclusive values must be stated, nor does it require a valuation methodology. If the transfer is for nil consideration (e.g., internal restructuring), the transferor must still state a value, presumably the market value of the title. Failure to provide a value may lead to rejection. Fifth, regulation 5(2) fixes the fee for a search under section 87(2) at $5.75 per page, not in revenue units. This is a dollar amount that has not changed since at least 1991. The Designated Authority cannot increase this fee without amending the regulation, which creates an incentive for the Authority to limit access to searches or to rely on other fee provisions. Sixth, the security amount for production licences ($300,000) is ten times that for exploration permits ($30,000) and 2.5 times that for pipeline licences ($120,000). A titleholder moving from exploration to production faces a sudden step-up in cash commitment and must plan for this well in advance. Finally, the regulations do not prescribe any mechanism for refunds if an application is withdrawn or rejected. A person who pays a fee under Schedule 2 for an application that is later abandoned may have no statutory right to a refund.

To comply with these regulations, a person or entity must adopt a systematic approach to fee payment, form use, and document preparation. First, before lodging any application under a section listed in Schedule 2, determine the current revenue unit value from the Interpretation Act (NT). Multiply the relevant number of revenue units in Column 2 of Schedule 2 by that value to obtain the dollar amount payable. Fee amounts should be confirmed with the Designated Authority if the revenue unit value is ambiguous. Pay the fee at the time of lodgement, as the Act likely requires payment before acceptance. For transfers under section 78, use the form in Schedule 1 exactly, completing all fields: delete “I” or “We”, insert the transferor’s name(s), specify the type and number of the title, insert the consideration or value, insert the transferee’s name and address, and affix seals or signatures. A witness is not required by the form but may be prudent. For any dealing lodged under section 81(4)(b), prepare a document that sets out all the particulars in regulation 4(1)(a) to (j). This includes: description and date of the dealing instrument; title details; full names and business addresses of all parties; the specific effect of the dealing upon registration by reference to section 81(1) paragraphs; pre and post registration interests of all parties; value of consideration (if section 92(5)(a) applies) or value of interest (if section 92(5)(b) applies); whether an application under section 92(7) will be made; and for any related dealing (as defined), its instrument description, date of approval and registration number. Maintain a register of all related dealings, including options and rights created before the main dealing. If the dealing is part of a chain, disclose each link. For annual fees under regulations 8 to 11, calculate the fee based on the number of blocks (or kilometres for pipelines) as at the start of each year. If the fee year includes any period after 30 June 2000, add the GST component using the formula in regulation 12(3). The Designated Authority may bill the GST component separately; pay it within one month of the charge. For security under section 114(1)(a), arrange a bank guarantee or cash deposit in the prescribed amount ($30,000 for exploration/retention, $300,000 for production, $120,000 for pipeline) before the grant of the title. Ensure the security is maintained for the entire term. For access to information or samples under section 118, expect to pay a loan fee of 35 revenue units per day or part day, a search fee of 35 revenue units per hour after the first half-hour, and all costs of copying or forwarding. Request a cost estimate before proceeding. Keep records of all payments, forms, and particulars for at least the life of the title, as the Designated Authority may require evidence of compliance in any subsequent transfer or renewal.