Using the volume model to calculate petroleum royalty
New petroleum royalty regulation changes gas swap arrangements
The Petroleum and Gas (Royalty) Regulation 2021 applies from 1 September 2021.
Find out about the extended gas swap arrangements.
Royalty is calculated by applying a prescribed rate to the volume of liable petroleum produced during a return period.
Different rates apply to the 4 classes of petroleum:
- domestic gas
- supply gas
- project gas
- liquid petroleum.
These position papers will help you to determine your royalty liability under the volume model:
Swap arrangements may be relevant for determining the classification of gas and average sales price for petroleum.
See the Commissioner of State Revenue's determinations on swap arrangements.
When calculating your petroleum royalty rates under the volume model, you may elect in your return form to use the benchmark price for a particular petroleum type as the average sales price on an ongoing basis. To end a benchmark election, you must complete an application to end benchmark election (Form R2.10). The Commissioner will consider the reasons why you want to end the election.