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Oil and Gas (Enterprise) Act 1982

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This is the original version (as it was originally enacted).

7Borrowing powers etc. of Oil Corporation

For subsections (3) and (4) of section 6 of the 1975 Act (borrowing powers etc.) there shall be substituted the following subsections—

(3)The aggregate amount outstanding at any time in respect of the principal of any money borrowed temporarily by the Corporation and relevant subsidiaries shall not exceed such amount as is for the time being specified by the Secretary of State; and the aggregate amount outstanding at any time in respect of the principal of—

(a)any money borrowed by the Corporation or a relevant subsidiary from an outside person;

(b)any sums for the repayment of which by an out side person the Corporation or a relevant subsidiary is surety or guarantor; and

(c)the Corporation's commencing debt, shall not exceed £600 million or such larger amount, not exceeding £800 million, as is for the time being specified by an order made by the Secretary of State.

(4)In applying subsection (3) above, any money borrowed temporarily by the Corporation or a relevant subsidiary for the purpose of repaying, before the due date, any money borrowed by it otherwise than by way of temporary loan shall be disregarded

(5)Where the Corporation or a relevant subsidiary sells petroleum on terms such that any of the petroleum will or may fall to be delivered more than twelve months after the payment of the price therefore, the price of so much of the petroleum as has not been delivered at any time after the payment shall be treated for the purposes of subsection (3) above as money borrowed by the Corporation or subsidiary from the purchaser.

(6)Where any person makes to the Corporation or a relevant subsidiary a payment which is to be appropriated to purchases of petroleum by that person from the Corporation or subsidiary, then, unless the terms of the payment are such that the whole of it may reasonably be expected to be so appropriated within twelve months after the making of the payment, so much of the payment as has not been so appropriated at any time shall be treated for the purposes of subsection (3) above as money borrowed by the Corporation or subsidiary from the purchaser.

(7)Where the Corporation or a relevant subsidiary purchases property on terms such that any part of the price will or may fall to be paid more than twelve months after the transfer of the property, so much of the price as has not been paid at any time after the transfer shall be treated for the purposes of subsection (3) above as money borrowed by the Corporation or subsidiary from the vendor.

(8)In applying subsection (7) above, any part of the price which may fall to be paid more than twelve months after the transfer of the property and which, if it did, would fall to be calculated by reference to the amount by which the value of the property exceeded its estimated value, or any income derived from the property exceeded the estimated amount of that income, shall be disregarded.

(9)Where in any case to which subsection (7) above applies any part of the price cannot be ascertained at the time of the transfer, that subsection shall have effect in relation to that part of the price as if—

(a)the amount thereof; and

(b)the extent to which it has not been paid at any time,

were such amount or extent as the Secretary of State, with the approval of the Treasury and after consultation with the Corporation, may determine.

(10)Where at any time a company ceases to be a relevant subsidiary, the Secretary of State may by order provide that subsection (3) above shall have effect as if for the amounts there specified there were substituted such lower amounts as he may consider appropriate having regard, in particular, to the aggregate amount outstanding at that time in respect of the principal of—

(a)any money borrowed by that company; and

(b)any sums for the repayment of which by an out side person that company was at that time surety or guarantor.

(11)In this section—

' the Corporation's commencing debt' means the debt assumed by the Corporation under section 4(2) of the Oil and Gas (Enterprise) Act 1982 ;

' outside person' means a person other than the Corporation or a relevant subsidiary;

' sell' includes barter and exchange and ' purchase ', ' price' and ' payment' shall be construed accordingly.

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