Finance (No.2) Act 1987

101 Oil taxation.

(1) Schedule 10 to the [1987 c. 16.] Finance Act 1987 (nomination scheme for disposals and appropriations of oil) shall have effect subject to the amendments in Schedule 8 to this Act.

(2) In section 62 of the Finance Act 1987 (market value of oil to be determined on a monthly basis) subsection (6) (meaning of relevant sale of oil in relation to the additional return required by subsection (4) of that section) shall have effect subject to the following modifications—

(a) after the words “sale of oil”, in the second place where they occur, there shall be inserted the words “at arm’s length”; and

(b) in paragraph (b) after the words “sub-paragraph (3A) thereof” there shall be inserted “or otherwise”.

(3) Section 63 of the Finance Act 1987 (blends of oil from two or more fields) shall have effect with the omission from subsection (1) of the words from “and in” onwards and with the addition, at the end of that subsection, of the following subsection—

“(1A) In this section—

(a) “oil field” includes an area which is a foreign field for the purposes of section 12 of the [1983 c. 56.] Oil Taxation Act 1983;

(b) “oil” includes any substance which would be oil if the enactments mentioned in section 1(1) of the principal Act extended to such an area as is referred to in paragraph (a) above;

(c) “blended oil” means oil which has been mixed as mentioned in subsection (1) above; and

(d) “the originating fields”, in relation to any blended oil, means the oil fields from which the blended oil is derived.”

(4) In paragraph 5 of Schedule 2 to the [1975 c. 22.] Oil Taxation Act 1975 (returns by the responsible person for an oil field) after sub-paragraph (2A) there shall be inserted the following sub-paragraph—

“(2B) If in any chargeable period oil won from the oil field is mixed as mentioned in section 63 of the Finance Act 1987 so as to give rise to blended oil, within the meaning of that section, then, as respects that chargeable period, for paragraph (a) of sub-paragraph (2) above there shall be substituted the following paragraph—

‘(a) state the total of the shares of the participators in the oil field of the oil won from the field during the period less so much of the oil won from the field as is not saved’.”

(5) Subsections (2) to (4) above have effect with respect to chargeable periods ending after 1st January 1987 and, subject to subsection (6) below, Schedule 8 to this Act has effect with respect to calendar months in chargeable periods beginning with March 1987.

(6) Paragraph 5 of Schedule 8 to this Act has effect with respect to chargeable periods ending after such date as the Treasury may by order made by statutory instrument appoint; but no order shall be made under this subsection unless a draft of it has been laid before and approved by a resolution of the House of Commons.