Section 79

(1) Subject to sections 142 (2) and 197(2) of the Petroleum Industry
and use of Act, a person intending to be involved in more than one stream, that is, upstream,
separate
midstream or downstream petroleum operations, shall register and use a separate
company for
company for each stream of petroleum operations under the Petroleum Industry
each stream
Act:
of petroleum
operations
Provided that, for companies with petroleum mining leases selected un-
Act No. 6,
der section 93 (6) (b) and (7) (b) of the Petroleum Industry Act, no stamp
2021
duties, value added tax or income tax on chargeable gains shall be levied by
the Government on such segregation.
(2) For strategic projects in the upstream petroleum operations that seek
to produce oil and natural gas to be processed or refined to finished petroleum
products, and supplied in wholesale solely to the domestic market, such projects
shall have the option to be established as an integrated strategic project (ISP),
whereby the capital investment in the associated midstream petroleum operations
as defined under the Petroleum Industry Act, can be consolidated with the
upstream petroleum operations for purposes of tax.
(3) Where an ISP option is elected, the following provisions shall apply –
(a) arm's length transfer prices shall be established to fiscalise the
hydrocarbons transferred from the upstream petroleum operations to the
midstream petroleum operations; and
(b) capital investment in the midstream petroleum operations consoli-
dated with upstream petroleum operations shall not be represented for capital
allowance when fiscalising the income from midstream petroleum operations.