The Oil and Gas Authority (Levy and Fees) and Pollution Prevention and Control (Fees) (Miscellaneous Amendments) Regulations 2020

Explanatory Note

(This note is not part of the Regulations)

These Regulations make provision for calculating and imposing a levy on the holders of petroleum licences in respect of the period beginning on 1st April 2020 and ending on 31st March 2021 (“the relevant charging period”). The levy is payable to meet costs incurred by the Oil and Gas Authority (“the OGA”) in carrying out its functions as well as costs incurred by the Lord Chancellor in connection with the provision of Tribunals to consider appeals against the decision of the OGA.

These Regulations also make provision to increase certain fees charged in relation to activities carried out by the Secretary of State and OGA relating to the offshore oil and gas industry.

Regulation 3 sets out liability to pay the production levy for the relevant charging period. This is the highest rate of levy.

Regulation 4 sets out liability to pay the non-production levy. Paragraphs (2) and (3) provide that micro-enterprises holding promote or innovate licences at the relevant time in certain circumstances qualify to pay the non-production levy at discounted rates in respect of those licences.

Regulation 5 provides the methodology for calculating the production levy and the non-production levy.

Regulations 6 to 8 provide for the process by which licensees are notified as to the amount of levy payable, for interest to be payable on late payments and for the OGA to be able to take action to recover any unpaid levy as a civil debt.

Regulation 9 requires the amount of the levy to be paid by licensees under regulation 3 or 4 to be adjusted if the total amount of levy to be recovered under these Regulations exceeds the leviable costs incurred by the OGA and Lord Chancellor in respect of the relevant charging period.

Regulation 10 sets out revised rates for fees under the Oil and Gas Authority (Fees) Regulations 2016.

Regulations 11 to 14 increase the hourly rates used to calculate fees charged under:

(a)

the Offshore Petroleum Production and Pipe-lines (Assessment of Environmental Effects) Regulations 1999 (S.I. 1999/360);

(b)

the Offshore Petroleum Activities (Conservation of Habitats) Regulations 2001 (S.I. 2001/1754);

(c)

the Offshore Petroleum Licensing (Offshore Safety Directive) Regulations 2015 (S.I. 2015/385);

(d)

the Pollution Prevention and Control (Fees) (Miscellaneous Amendments and Other Provisions) Regulations 2015 (S.I. 2015/1431), which makes provision for charging fees:

(i)

relating to certain activities under the Merchant Shipping (Oil Pollution Preparedness, Response and Co-operation Convention) Regulations 1998 (S.I. 1998/1056), the Offshore Installations (Offshore Safety Directive) (Safety Case etc.) Regulations 2015 (S.I. 2015/398) and the Fluorinated Greenhouse Gases Regulations 2015 (S.I. 2015/310);

(ii)

relating to certain licences under regulation 55 of the Conservation of Offshore Marine Habitats and Species Regulations 2017 (S.I. 2017/1013);

(iii)

in connection with consents to locate under section 82A of the Energy Act 2008 (c.32), and emergency safety notices under sections 82F and 82G(8) of the Energy Act 2008;

(iv)

in respect of monitoring compliance with the requirements of the Energy Savings Opportunity Scheme Regulations 2014 (S.I. 2014/1643); and

(v)

for applications for certain licences under section 71 and for stop notices and emergency safety notices under sections 102-105 of the Marine and Coastal Access Act 2009 (c.23).

The fees referred to in regulations 11 to 14 are calculated by first determining the number of hours work carried out by specialist and non-specialist officers and then multiplying those numbers by the relevant hourly rate. In each case these Regulations increase the hourly rate for specialist officers from £183 to £190 and for non-specialist officers from £98 to £101.

A full impact assessment has not been produced for this instrument as no or no significant impact on the private, voluntary or public sectors is foreseen. An impact assessment was produced for the original levy regulations, the Oil and Gas Authority (Levy) Regulations 2015 and is available from the Department for Business, Energy and Industrial Strategy at 1 Victoria Street, London SW1H 0ET and on www.legislation.gov.uk.