NEW PALAU PETROLEUM ACT SIGNED BY PRESIDENT

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Toribiong: Palau can now realize revenues from natural resources

By Aurea Gerundio-Dizon

KOROR, Palau (Island Times, Dec. 30, 2011) – President Toribiong yesterday signed into law the Petroleum Act for the Republic of Palau.

The new law, designated as RPPL No. 8-37, will govern the prospecting, exploration, exploitation, development and production of oil and gas resources, including mineral resources that are found on land, offshore within the 200 nautical mile exclusive economic zone or on the continental shelf subject to the sovereign jurisdiction and exclusive ownership of Palau.

The Petroleum Act clarifies the rights and obligations of the national government and state governments, as stated in the Constitution as well.

The Petroleum Act was aimed at establishing a comprehensive, national petroleum law, incorporating international guidelines, standards and practices in the petroleum field that will promote the prudent development and effective regulation of petroleum operations and related activities within the territory.

The new law requires transparency for all transactions and conduct of petroleum operations.

Among the requirements is the annual publication of all payments made by or on behalf of each licensee in the conduct of petroleum operations in a publicly accessible, comprehensive and comprehensible manner and all payments and revenues arising from or relating to petroleum operations shall be subject to credible and independent audit, applying international auditing standards.

Now that the exploration and extraction aspects of the petroleum industry have been enacted into law, the president said he will then appoint a ministry to oversee the Act through an Executive Order.

"God willing, perhaps Palau can now begin to realize some revenues from natural resources with which we have been blessed," Toribiong said after signing the law.

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