The Oil Stocking Order 2012

Explanatory Note

(This note is not part of the Order)

This Order forms part of the implementation by the United Kingdom of Council Directive 2009/119/EC imposing an obligation on member States to maintain minimum stocks of crude oil and/or petroleum products (OJ No L 265, 9.10.2009, p.9) (“the 2009 Directive”). The other obligations of the 2009 Directive requiring transposition are implemented by section 6 of the Energy Act 1976 (c.76) (“the 1976 Act”) and directions given under that provision. Such a direction may require a producer, supplier or user of crude liquid petroleum or petroleum products to create and maintain stocks at a specified level. The United Kingdom stocks held by such persons are used by the United Kingdom to meet its obligations under the 2009 Directive to hold emergency stocks.

Part 2 provides when stocks of crude liquid petroleum or petroleum products, as well as biofuels and additives, may be counted as United Kingdom stocks for the purpose of complying with a direction under section 6 of the 1976 Act.

Under Part 3, article 7 restricts execution and other legal process against stocks designated by another member State as “specific stocks” under Article 9 of the 2009 Directive. Article 8 requires a person who has been given a direction under section 6 of the 1976 Act, to notify the Secretary of State if that person ceases to be a producer, supplier or user of crude liquid petroleum or petroleum products. The Secretary of State may extend the period of a direction which applies to such a person.

Under Part 4, article 9 requires authorisation by the Secretary of State of arrangements under which stocks may be held in the United Kingdom on behalf of other member States. Article 10 requires that consent from the Secretary of State is required to move specific stock which is held in the United Kingdom and is commingled with other stock. Article 11 prevents any person from hindering an emergency stock release.

Under Part 5, articles 12 and 13 set out the procedural requirements in respect of applications for the authorisation of arrangements. Schedule 1 sets out the details required in respect of applications. Article 14 provides for the revocation of authorisations.

Part 6 prescribes the circumstances in which a person is to be treated as a substantial supplier to the United Kingdom market, being a person who can be directed to create stocks of crude liquid petroleum and petroleum products under section 6(2)(b) of the 1976 Act.

Part 7 sets out criminal penalties in respect of the offences in this Order for which provision is made under section 2(2) of the European Communities Act 1972 (c.68). Schedule 2 makes provision for the enforcement of those penalties, replicating in relevant part the provisions in Schedule 2 to the 1976 Act which have effect with respect to the enforcement of that Act and provision made under it.

Under Part 8, article 18 revokes the Petroleum Stocks Order 1976 (S.I. 1976/2162), the Petroleum Stocks (Amendment) Order 1982 (S.I. 1982/968) and the Petroleum Stocks (Amendment) Order 1983 (S.I. 1983/909). Article 19 requires the Secretary of State to review the operation and effect of this Order and publish a report within five years after it comes into force and within every five years after that. Following a review it will fall to the Secretary of State to consider whether the Order should remain as it is, or be revoked or be amended. A further instrument would be needed to revoke the Order or to amend it.

A full impact assessment of the effect that this instrument will have on the costs of business and the voluntary sector is available. A transposition note setting out how the 2009 Directive is transposed into the law of the United Kingdom is also available. These documents can be obtained from the Energy Resilience Team, Department of Energy and Climate Change, 3 Whitehall Place, London SW1A 2AW. These documents have also been published with the Explanatory Memorandum alongside the instrument on www.legislation.gov.uk.