Oil and Gas Act of 1998 (Papua New Guinea)
The Oil and Gas Act is the principal governing law for petroleum exploration and development in Papua New Guinea (PNG). The Act provides for the application and issuance of various licenses including petroleum prospecting licenses, petroleum retention licenses, petroleum development licenses, pipeline licenses and petroleum processing facility licenses. The provisions include the rights conferred by the licenses, terms of the licenses, application for extension, grant or refusal of extension, conditions for issuance, among others. The Act also provides for imposable fees, royalties and development levies. The Act also provides for State Equity Entitlement which means that the State has the right (but not the obligation) to acquire, directly or through a nominee, all or any part of a participating interest not exceeding 22.5% in each petroleum project. Moreover, the State grants to the project area landowners, the affected Local-level Government and the affected Provincial Governments of a petroleum project, a royalty benefit shared among them in the proportions agreed in a development agreement or, by default, determined by the Minister in an instrument.