Petroleum and Other Minerals Development Act, 1960
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Form and amount of compensation. |
36.—(1) Compensation for petroleum shall be in the form of a royalty rent. | |
(2) The total amount of compensation for petroleum brought to the surface at a petroleum well within the area specified in a petroleum lease and used or sold shall be such proportion of one-third of the royalty rent reserved by the said lease in relation to such petroleum well, as the compensation area in relation to such petroleum well bears to the area contained in a circle of a quarter-mile radius. | ||
(3) The total amount of compensation for petroleum brought to the surface at a petroleum well within an area specified under subsection (2) of section 14 of this Act and used or sold, shall be such proportion of one-third of the royalty rent which would have been payable in relation to such petroleum well if the petroleum in the area so specified had been the subject of a petroleum lease reserving a royalty rent of seven and a half per cent. of the prescribed value of the petroleum (excluding petroleum used by the Minister in searching for or working petroleum in the area), as the compensation area in relation to such petroleum well bears to the area contained in a circle of a quarter-mile radius. |