6Reduction of royalty in certain cases

6 Reduction of royalty in certain cases

(1) Where the Designated Authority is satisfied that the rate of recovery of petroleum from a well has become so reduced that, having regard to the rate or rates of royalty applicable under the last preceding section, further recovery of petroleum from that well would be uneconomic, the Joint Authority may, by instrument in writing, determine that the royalty in respect of all or any of the petroleum recovered from that well on or after a date specified in the determination shall be at such rate (being a rate lower than the rate that would be applicable under the last preceding section) as the Joint Authority specifies. (2) The prescribed rate in respect of petroleum to which a determination under subsection (1) is applicable is the rate specified in the determination. (3) The Joint Authority may, by instrument in writing, revoke or vary a determination under subsection (1) and the revocation or variation applies to petroleum recovered on or after such date as is specified in the instrument.