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New Zealand Oil & Gas

New Zealand Oil & Gas

New Zealand is ranked 8th in the world for its abundant natural resources (World Bank 2010), ranked top in the world for least corrupt government (Transparency International, 2012) and is ranked first in the world for investor protection (World Bank 2013).

New Zealand Legislative Framework

The Crown Minerals Act 1991 (“Minerals Act”) sets out the broad legislative framework for the exploration and production of petroleum within New Zealand. The relevant regulations for petroleum permit holders are the Crown Minerals (Petroleum) Regulations 2007, the Crown Minerals (Petroleum Fees) Regulations 2006, and the Crown Minerals (Royalties for Petroleum) Regulations 2013.
New Zealand's royalty regime stipulates the payment of either an ad valorem royalty (AVR) or an accounting profits royalty (APR), depending on whichever is the greater in any given year. The royalty rates are either:
a) 5% AVR, that is 5% of the net revenues obtained from the sale of petroleum, or
b) 20% APR, that is 20% of the accounting profit of petroleum production.