Regulation for implementing the Petroleum Law of the Mongolian People’s Republic.

The purposes of the Regulation are to legally confirm general regulations for the Petroleum Operations in accordance with provisions and ideas of the Petroleum Law. The Government shall consider a draft of a contract submitted by Administration and may permit Contractor to conduct the Petroleum Operations in the territory of MPR. Mining permit is to be granted according to appropriate procedures. The Government of the MPR and administration shall have the right of access to and control of the Contract Area and Petroleum Operation. The municipal organization shall only have the right of access. The Government will adopt the amount and forms of payment of royalty and levy tax according to the MPR appropriate tax regulation. In case of emergencies involving national security, environmental damage, or preservation of historical and cultural values, the Government may decide to prohibit and restrict Petroleum Operations and will inform Contractor of the decision in time. The document consists of VII Sections that contain 35 Articles. Section I (arts. 1-7) lays down general provisions. Section II (Arts.8-10) regards application, negotiations, approval. Section III (Arts.11- 15) regards petroleum operations. Section IV (Arts.16-22) regards valuation of petroleum, royalty, rent, taxation, bonuses, administration fee, accounting procedure. Section V (Arts.23-24) deals with cost recovery and production sharing. Section VI (Arts.25-28) regards importing, owning, free of customs duties and selling property. Section VII (Arts.29-35) regards additional provisions.