Oil and gas producers will be subject to tougher liabilities and rules around decommissioning in Australia in an effort to prevent a repeat of the Northern Endeavour fiasco, which is expected to cost taxpayers over $190 million. The raft of measures announced yesterday by federal resources minister Keith Pitt includes a stricter “trailing liability” regime, which will allow the government to pursue a former permit holder to pay for decommissioning work if needed. The draft legislation will enhance regulators’ powers to evaluate the suitability of companies buying into an asset and take action when control of a company changes hands. The proposed legislation requires companies with greater than 20% interest in a title to inform the National Offshore Petroleum Titles Administrator of a change in control within 30 days or face a fine in excess of A$500,000. Change of control will be subject to government approval. Earlier this year ExxonMobil abandoned its $3 billion sale of its ageing Bass Strait assets after Pitt warned...read more...
SectorOil & Gas