Capital Gains: Rebasing of Assets Held at 31 March 1982 - Definitions
Oil Exploration or Exploitation Assets are assets which have at some time been used in connection with activities of searching for, winning or exploiting oil in the UK or UKCS which are either:
- non-mobile assets (e.g. most platforms, pipelines etc), or
- mobile assets dedicated to an oil field in which the company (or a connected person) is, or has been, a participator (e.g. a shuttle tanker used to evacuate crude or a floating production platform).
These terms have their PRT meaning at OTA75\Part 1.
A mobile asset is dedicated to an oil field if it is used in connection with the field, and is likely to continue to be so used, during substantially the whole of its life, although not necessarily to that field exclusively (e.g. a support vessel used 80% of the time on one field and 20% on several other fields).
There is no statutory definition of mobile but its dictionary meaning implies ease and expectation of movement while in use.
It was necessary to include connected persons in relation to mobile assets to cover intra- group transfers at no gain/no loss.
Oil Exploration or Exploitation Rights are rights to assets to be produced by oil exploration or exploitation activities, being activities carried on in connection with searching for, winning or exploiting oil in the UK or UK Continental Shelf, or rights to interests in or to the benefits of such assets. These rights will include rights to future oil production under the licence but also a subordinated interest in that oil e.g. a net production interest.