Section 25, No. The Extractive Industries Revenue Act 2018No. The Extractive Industries Revenue Act 2018

Subject to this section , in calculating a person’s chargeableincome from a separate petroleum operation for a year of assessment the following shall be included- (a) royalties, area fees and rent paid by the person under this Act or the Petroleum (Exploration and Production) Act, 2011 for the petroleum right, but not exceeding any liability under the relevant extractive industry agreement; (b) expenditure (other than financial costs) for the petroleum operation on the following, but only if it has been expensed in the person’s financial accounts and that expensing is in accordance with generally accepted accounting principles: (i) expenditure on reconnaissance, appraisal and exploration operations; (ii) expenditure in developing petroleum operations and infrastructure, including as may be prescribed by regulations; (c) capital allowances granted for petroleum operation and calculated in accordance with paragraph 5 of the Second Schedule including the disposal of an interest in a petroleum right; (d) contributions to and other expenses incurred in respect of a decommissioning fund for the petroleum operation as required under the extractive industry agreement or decommissioning plan approved by the Minister responsible for management of petroleum matters; Deductions forPetroleum Operations (b) amounts (including interest) accumulated in or withdrawn from the fund. (2) Where there is a surplus in a decommissioning fund and the person conducting the relevant separate petroleum operation- (a) completes decommissioning in accordance with the approved decommissioning plan so as to be entitled to receive the surplus; or (b) breaches the terms of the approved decommissioning plan, the surplus shall be included in calculating the chargeable income of the person from the separate petroleum operation for the year of assessment in which the event referred to in paragraph (a) or (b) occurs. (3) In addition to the consequences referred to in subsection (2), the person may be liable for petroleum resource rent tax for the surplus.