PRT: non-field expenditure - exploration and appraisal expenditure: searching and ascertaining
Searching and ascertaining (or exploration and appraisal) will cover
- the cost of shooting or purchasing seismic (in contrast to the CT provisions, see OT26045, there is no distinction between seismic that is directly commissioned or purchased)
- the cost of interpreting seismic data
- drilling exploration wells
- further evaluation of the geological prospects
- drilling of wells to ascertain the extent of the reservoir, testing flow rates etc.
Conversely, it will not include
- production feasibility studies
- preliminary engineering and design work studies
- work done on evaluating another company’s prospects before buying its share capital or seeking to ‘farm in’ (see OT18320)
- drilling of future production slots under the guise of appraisal wells
- economic studies.
Both these lists are intended as a guide and not to be exhaustive.