Corporation Tax Act 2010 section 272

Oil extraction activities

Section 272 defines "oil extraction activities" for the purposes of Part 8, covering the searching, extracting, transporting, and initial treatment or storage of oil within the UK or designated areas.

• Oil extraction activities include searching for oil in the UK or a designated area, and extracting oil under authorised rights held by the company or an associated company.
• Transporting oil extracted offshore is included if the oil is carried to the place where it first lands in the UK, or to the place where an arm's length seller could reasonably be expected to deliver it.
• Initial treatment and initial storage of oil won from an oil field are also oil extraction activities, provided the extraction rights are held by the company or an associated company.
• The definitions of "initial storage" and "initial treatment" are taken from section 12(1) of the Oil Taxation Act 1975, with an adjustment so that storage capacity is proportionate to the company's share of oil won from the field.