Circular of the Ministry of Finance and the State Administration of Taxation on Amendment of the Interim Provisions concerning Payment of Royalties for Chinese-Foreign Cooperative Exploitation of Inland Petroleum Resources

Circular of the Ministry of Finance and the State Administration of Taxation on Amendment of the Interim Provisions concerning Payment of Royalties for Chinese-Foreign Cooperative Exploitation of Inland Petroleum Resources
Circular of the Ministry of Finance and the State Administration of Taxation on Amendment of the Interim Provisions Concerning Payment of Royalties for Chinese-Foreign Cooperative Exploitation of Inland Petroleum Resources

Cai Shui Zi [1995] No.63

July 28, 1995

The finance departments (bureaus), and state taxation bureaus of all provinces, autonomous regions, municipalities directly under the Central Government, the finance bureaus, and state taxation bureaus of all cities specifically designated in the state plan,

The Interim Provisions on the Payment of Royalties for Sino-Foreign Cooperative Exploitation of Land-based Petroleum Resources was issued by the Ministry of Finance on January, 1995. In order to meet the need of exploiting petroleum resources cooperating with foreigners, encouraging foreign businessmen to invest in cooperative exploitation of inland petroleum resources in China, it is hereby decided after studying to amend Article 3 and Article 12 of the Interim Provisions on the Payment of Royalties for Sino-Foreign Cooperative Exploitation of Land-based Petroleum Resources as follows:

Article 3 The royalties shall be computed and imposed separately according to the gross output of crude oil or natural gas from each oil or gas field in a calendar year. The royalties shall be as follows:
1. The rates of royalties for the Chinese-foreign cooperative oil or gas field located in Qinghai, Tibet, Xinjiang provinces or regions and shallow sea regions shall be as follows:
(1) Crude Oil
The gross output of crude oil from each field in a calendar year Royalty rate
The range not exceeding 1 million ton exempted
The range from 1 million to 1.5 million ton 4%
The range from 1.5 million to 2 million ton 6%
The range from 2 million to 3 million ton 8%
The range from 3 million to 4 million ton 10%
The range over 4 million ton 12.5%
(2) Natural Gas
The gross output of natural gas from each field in a calendar year Royalty rate
The range not exceeding 2 billion cubic meters exempted
The range from 2 billion cubic meters to 3.5 billion cubic meters 1%
The range from 3.5 billion cubic meters to 5 billion cubic meters 2%
The range over 5 billion cubic meters 3%
2.
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