Reporting of payments to governments

This report is prepared in accordance with the Norwegian Accounting Act Section § 3-3 d) and Securities Trading Act § 5-5 a). It states that companies engaged in activities within the extractive industries shall annually prepare and publish a report containing information about their payments to governments at country and project level. The Ministry of Finance has issued a regulation (F20.12.2013 nr 1682 – «the regulation») stipulating that the reporting obligation only apply to reporting entities above a certain size and to payments above certain threshold amounts. In addition, the regulation stipulates that the report shall include other information than payments to governments, and it provides more detailed rules applicable to definitions, publication and group reporting.

This report contains information for the activity in the whole fiscal year 2016 for BP Norge AS, including the period before it became part of the Aker BP group.

The management of Aker BP has applied judgment in the interpretation of the wording in the regulation with regard to the specific type of payment to be included in this report, and on what level it should be reported. When payments are required to be reported on a project-by-project basis, it is reported on a field-by-field basis. Only gross amounts on operated licences are reported, as all payments within the licence performed by non-operators will normally be cash calls transferred to the operator and will as such not be payments to the government. Aker BP’s activities within the extractive industries, are in all material respects located on the Norwegian Continental Shelf. Hence, the main part of the reported payments below is to the Norwegian government. However, part of the Ivar Aasen project has been conducted in Singapore and in 2016 there was a tax payment to Singapore Tax Authorities which is deemed to be in scope for this reporting.

Reporting of payments

The regulation’s Section 2 no. 5 defines the different types of payments subject to reporting. In the following sections, only those applicable to Aker BP will be described.

Income tax     

Norway

The income tax is calculated and paid on corporate level and is therefore reported for the whole company rather than licence-by-licence. The tax payments in 2016 of NOK 13 213 770 (including interest) are mainly related to adjustments from previous years. This number excludes tax refunds received in 2016.

Singapore

The tax payment related to the activity in the Singapore Branch for 2016 amounted to 490 858 Singapore Dollar.

CO2 tax

CO2 tax is to some extent included in the fuel price/rig rental paid to external rig companies. The CO2 tax paid on the Alvheim field includes the fields tied in to the Alvheim FPSO (Vilje, Volund and Bøyla) as Alvheim performs the payment and charges the other fields via opex share.

Name of field/license   CO2  tax paid in 2016 (NOK)
Alvheim 79 501 965
Hod 177 897
Valhall 11 106 568
Ula 66 317 194
Skarv 132 490 396
Total CO2 paid 289 594 020


NOx

The company is member of the NOx fund and all NOx payments are made to this fund rather than to the government.

Area fee

The table below specifies the area fee paid by Aker BP on behalf of the different licences in 2016. Licenses of which the company has received net refund of area fee are not included in the figures.

Name of field/license  Area fee paid in 2016 (NOK)
Alvheim

Bøyla

Hod

Skarv

Tambar

Ula

Valhall

Vilje

Volund

PL 150B

PL 026B

10 960 000

4 110 000

4 120 000

33 702 000

4 521 000

4 040 000

5 120 000

762 005

1 781 000

449 180

680 000

PL 103B 1 370 000
PL 212B 3 151 000
PL 242 2 192 000
PL 261 21 372 000
PL 364 4 384 000
PL 442 12 330 000
PL 460 6 439 000
PL 539 5 604 411
PL 407 1 415 792
Total area fee paid 134 257 388

Other information required to be reported

When companies are required to report payments as the above, it is also mandatory to report on investments, sales income, production volumes and purchases of goods and services in the country in which companies have activities within the extractive industries. As mentioned above, Aker BP operates on the Norwegian Continental Shelf only. This reporting requirement is therefore deemed to be met by the financial statements as specified below:

  • Total net investments amounted to USD 705 494 110 thousand, as specified in the cash flow analysis in the financial statements. This includes cash payments related to the acquisition of BP Norge AS.
  • Sales income in 2016 amounted to USD 1 260 803 thousand, as specified in Note 8 to the financial statements
  • Total production in 2016 was 28 343 036 barrels of oil equivalent, see Note 8 to the financial statements
  • For information about purchases of goods and services, reference is made to the Income Statement and the related notes