§ Mr. Dempseyasked the Secretary of State for Energy whether he has reached any further participation agreement.
§ Dr. J. Dickson MabonIn implementation of Her Majesty's Government's policy of securing majority state participation, Her Majesty's Government and the British National Oil Corporation, BNOC, concluded on 17th December a memorandum of understanding with Chevron on the principles governing majority State participation in Chevron's interest in the Ninian Field and related facilities in the North Sea. All parties intend to conclude a definitive legal agreement embodying these principles as soon as possible.
The agreement provides for BNOC to have access after a build-up period to up to 51 per cent. of Chevron's oil from the Ninian Field at market price with Chevron having certain repurchase rights. There will be full consultations between Her Majesty's Government, advised by BNOC under Section 3(3) of the Petroleum and Submarine Pipelines Act 1975, and Chevron on matters of common interest. Through these participation 124W arrangements, BNOC will gain an effective voice and vote in the committees managing field operations.
The Government and BNOC have also today signed heads of agreement on participation by BNOC with Santa Fe (UK) Limited and Santa Fe Minerals (UK) Inc in respect of the Santa Fe interest in the licence covering Block 211/18 in which the greater part of the Thistle Field is situated. It is intended that a definitive agreement should be signed by 31st May 1977. Santa Fe has a 22.5 per cent. interest in the licence and a 21.7 per cent. interest in the Thistle Field.
Under the agreement BNOC will after a build-up period have the right to take, at market price, up to 51 per cent. of Santa Fe's share of petroleum won and saved from all commercial development in Block 211 /18. The agreement also provides for BNOC to have additional voting rights under the pertinent operating agreements.
The implementation of the agreement will fully satisfy the Government's policy of achieving majority State participation in Santa Fe's interest whilst leaving Santa Fe financially neither better nor worse off.