Quyết định 84/2010/QD-TTg

DECISION

ON ISSUING REGULATION ON OIL AND GAS EXTRACTION

THE PRIME MINISTER

Pursuant to the Law on Organization of the Government dated December 25, 2001;

Pursuant to the Petroleum Law dated July 6, 1993 and the Law amending and supplementing a number of articles of the Petroleum Law dated June 9, 2000; the Law amending and supplementing a number of articles of the Petroleum Law dated June 03, 2008;

Pursuant to Decree No. 48/2000/ND-CP dated September 12, 2000 of the Government detailing the implementation of the Petroleum Law and Decree No.115/2009/ND-CP dated December 24, 2009 of the Government amending and supplementing a number of articles of Decree No. 48/2000/ND-CP detailing the implementation of the Petroleum Law and Regulation on bidding for oil and gas exploration and extraction projects issued together with the Decree No. 34/2001/ND-CP;

At the proposal of the Minister of Industry and Trade,

DECIDES:

Article 1. Issuing with this Decision the Regulation on oil and gas extraction.

Article 2. This Decision take effect on February 15, 2011.

This Decision supersedes the Decision No. 163/1998/QD-TTg dated September 07, 1998 of the Prime Minister on issuing Regulation on extraction of oil and gas resources.

Article 3. Implementation organization

1.The Ministry of Industry and Trade will guide and organize the implementation of this Decision.

2. Ministers, heads of ministerial-level agencies, heads of government-attached agencies, Chairmen of People's Committees of provinces and centrally-affiliated cities are liable to execute this Decision.

REGULATION 

OIL AND GAS EXTRACTION

 (Issued together with Decision No. 84/2010/QD-TTg dated December 15, 2010 of the Prime Minister)

Chapter 1.

GENERAL PROVISION

Article 1. Subjects of application and scope of adjustment

1. This Regulation applies to state agencies, organizations and individuals related to the activities of oil and gas extraction.

2. This Regulation prescribes the activities of oil and gas extraction in the territory, exclusive economic zone and continental shelf of the Socialist Republic of Vietnam.

Article 2. Explanation of terms

In this Regulation, the terms below are construed as follows:

1. Well intervention is the activities of repair or technical impacts conducted at the extraction well, injection well, waste well or survey well in order to restore, enhance or change the extraction flow or injection including the completion of the well;

2. Oil and gas extraction works are the combination of means and equipment for the oil and gas extraction including fixed rig, mobile rig, warehouses, storage tanks, pipeline system, mooring buoys, wells and related equipment;

3. Extraction equipment and means is the equipment which is installed in the extraction area including separators, treaters and auxiliary equipment for extraction, gathering areas, helipads, warehouse, storage tank, housing, but excluding rigs, underwater extraction system, drilling equipment, diving equipment system or output pipeline;

4. Offshore oil and gas extraction works is the oil and gas extraction works which are built, installed at the offshore locations;

5. Onshore oil and gas extraction works is the oil and gas extraction works which are built, installed onshore or on natural or artificial island.

6. Fluid is crude oil, crude gas, gas condensate, liquefied gas mixture or water;

7. Waste is the types of solid, liquid substances, gas or waste liquid waste from the well or other impurities generated during the extraction activity or other activities at the oilfield;

8. Physical environmental condition is the climatic, hydrological, oceanographic conditions and other physical conditions relating to the implementation of this Regulation;

9. Oil and gas extraction team is the personnel assigned with tasks by the operator to operate the oil and gas extraction works;

10. Injection pipeline is the pipeline used to transport fluid to the injection well or waste well;

11. Technological pipeline is the pipeline used to transport fluid from the well to technological equipment and vice versa;

12. Infield pipeline is the pipeline used to transport fluid and connected between extraction works within the oilfield

13. Output pipeline is the pipeline used to transport oil and gas from extraction works to other locations outside extraction area.

14. Injection well is the well used to inject fluid into the reservoir or oilfield;

15. Oil well is crude oil extraction well from the reservoir, product layer or oilfield;

16. Gas well is the well extracting gas from gas reservoir, product layer or gasfield or from gas cap of the oilfield.

17. Appraisal well is the well drilled to gather more information about the volume and properties of product reservoir, product layer or oilfield;

18. Development well is the well drilled into the product reservoir, product layer or oilfield to conduct the following activities:

a) Extraction of product or fluid;

b) Observation and monitoring of change of product reservoir;

c) Injection of fluid into product reservoir or layer;

d) Injection of fluid into well.

19. Oil and gas recovery factor is the ratio between the amount of oil which may be extracted from the field or from reservoir compared with the oil reserve on the spot of the oilfield or reservoir in expected technical economic conditions;

20. Oil and gas extraction activities are all activities related to the oil and gas extraction from the product reservoir or layer or field;

21. General plan for oil and gas field development is the overall plan established by the operator and submitted to the Vietnam Oil and Gas Group for approval in order to choose the most appropriate development scheme (early or full field development) at the time of report taking in account the possibility of field or area expansion (if any) in the future;

22. Plan for early oil and gas extraction is a material made by the operator and approved by the Vietnam Oil and Gas Group for submission to the Ministry of Trade and Industry for approval in order to apply appropriate technology to gather information about the reservoir or field or gather information about the behaviour of extraction to optimize the field development;

23. Plan for development of oil and gas field is a material made by the operator and approved by the Vietnam Oil and Gas Group for submission to the Prime Minister for approval to carry out the works construction, equipment installation and extraction of reservoir or field;

24. Completion part of well is the part of well shaft which has been reinforced or installed with equipment through which fluid enters or goes out of well body;

25. Part of oil and gas extraction toroidal rim is the space between the outer wall of tubing and inner wall of casing;

26. Oil and gas extraction area is the area which is having or will be installed with oil and gas extraction works under the provisions of this Regulation

27. Oilfield is a combination of geological structures in the ground which has been identified with one or more product reservoirs or product layers which are estimated to contain oil, gas capable of commercial exploitation and ensure the economics at a specified time;

28. Extracted water is the water recovered together with oil and gas from extraction well;

29. Reservoir water is the water with natural origin appearing in the voids of soil and rock including natural water in the reservoir, strata, other containing layers and only moving in the reservoir or field due to impact of extraction activities

30. Oil and gas casing is the one installed in the well shaft to separate oil reservoir from other reservoirs;

31. Oil and gas extraction pipe is the pipe installed along the well shaft to extract or inject the fluid;

32. Packer is the equipment of well bed used to separate the space of toroidal rim between the tubing and casing or the part of naked shaft for extraction activities or injection of the well.

33. Supporting means are means of air, waterway and road transport or other means used to transport people, materials, equipment or support other works;

34. Extraction output approved is the extraction output in a specified time and is approved by the Vietnam Oil and Gas Group.

35. Actual extraction output is the oil and gas output actually achieved within a specified time;

36. Serious accident or incident is the accident or incident happening at the area of oil and gas extraction leading to one of the following consequences:

a) There are people dead or missing;

b) Causing serious injury to employees operating the oil and gas extraction works to the extent that these employees cannot undertake their assigned tasks.

c) There are incidents of fire or explosion causing serious consequences;

d) Oil spill incident;

dd) Leakage of radioactive or toxic substances;

e) Loss of control fluid flow running from the well;

g) There are equipment and means necessary for the safety of people, works or means damaged beyond repair;

h) There is equipment and facilities essential to the environmental protection damaged beyond repair.

37. Product reservoir is a reservoir containing natural oil and gas in the oil and gas field is estimated to contain an accumulation of oil and gas separated from the other reservoirs by partitioning factors.

38. Product layer is a combination of product reservoir in a stratigraphic unit of oil and gas field.

39. Underground extraction equipment is the equipment installed on the sea floor to serve the oil and gas extraction or injection of fluids including pipelines and related extraction control systems;

40. Reservoir testing is the hydrodynamic study conducted to determine some hydrodynamic properties of reservoir and assess the extraction capacity of the well and reservoir through the determination of relationships between pressure of well bottom with the flow of fluid of reservoir extracted from well;

41. Pat of reservoir testing is a part of well shaft opened through the reservoir and bank during reservoir testing;

42. Extraction part is a part of well shaft opened through the reservoir or product layer during the extraction;

43. Oil reservoir is the reservoir containing oil and gas primarily in the form of liquid;

44. Gas reservoir is the reservoir containing oil and gas primarily in the form of gas;

Article 3. Presenting and submitting information and specimen

Organizations or individuals conducting oil and gas activities will have to submit the information, documents and specimen to the Vietnam Oil and Gas Group as prescribed by this Regulation and relevant legal documents.

Chapter 2.

PLAN FOR FIELD DEVELOPMENT AND OTHER ACTIVITIES OF OIL AND GAS EXTRACTION

Article 4. General plan for development of oil and gas field

1. Contents of Report on general plan for development of oil and gas field include:

a) Introduction of contents and purpose of the Report;

b) History of exploration and appraisal of oil and gas volume, geological modeling of the field and appraisal plan at the next stage;

c) Field technologies and expected development schemes; preliminary oil recovery factor;

d) Forecast of extraction output and field operation management;

dd) Preliminary design of selected development schemes: Technology diagram, works construction and installation of equipment;

e) Drilling technology, drilling plan and well completion;

g) Safety and environmental protection;

h) Technical and economic evaluation and selection of appropriate development schemes at the time of report preparation;

i) Evaluation of financial and technological level of risk of project;

k) Progress of project implementation.

2. In order to have the grounds for preparation of general plan for development of oil and gas field, the operator will prepare preliminary design to determine the total investment with the permissible rate of error difference of less than 30%.

3. Competence and procedures for approval of the general plan for development of oil and gas field comply with provisions of relevant legal documents and agreement in the oil and gas contract.

Article 5. Plan for development of field

1. Report on the plan for development of field is prepared based on the selected scheme of the Report on general plan for development of oil and gas field aiming at optimal development and extraction.

2. Report on the plan for development of oil and gas field needs the supplementation, update and detail of information in the general plan for development of oil and gas field including basic contents as follows:

a) Introduction of contents and purpose of the Report;

b) Result of study of geological features of the field;

c) Data and component analysis, fluid properties and reservoir, oil and gas extraction output, oil recovery factor;

d) Studies of field simulation models, field technology and extraction design;

dd) Information about extraction technology and feasible studies.

e) Well drilling technology and completion;

g) Description of works system and extraction equipment used;

h) Data and components analysis and environmental properties;

i) Plans for treatment, disposal or burial of waste;

k) Expected plans: Protection of natural resources and environment; safe operation and handling of incidents; solution to prevention and treatment of pollution risks and field clearance for environmental rehabilitation after extraction.

l) Personnel, training and local human resources;

m) Calculation of total investment, economic efficience of project;

n) Evaluation of financial and technological level of risk of the project;

o) Progress and schedule of implementation;

p) Making statistics of technical principles and regulations applicable during extraction drill.

q) Conclusion and proposal.

3. The operator will have to carry out the basic design (FEED) or equivalent to prepare the cost estimate of total investment of the Plan for development of oil and gas field with the rate of error difference of less than 10%;

4. Competence and procedures for approval of the Plan for development of oil and gas field;

a) The operator will be only permitted to conduct the extraction activities under the Plan for development of field approved by the Prime Minister;

b) Procedures for approval of the Plan for development of field comply with provisions of relevant legal documents and agreement in oil and gas contract.

Article 6. Early extraction Plan

1. The early extraction Plan is prepared in the following cases:

a) The available information does not allow the determination of reasonable extraction scheme according to the usual practice but need to gather and supplement data on the basis of monitoring the actual behavior of extract of the field, product layer and reservoir;

b) The ratio of P1/2P reserve grade is not lower than 40% except for special cases decided by the Prime Minister.

2. Early extraction Plan for the purpose:

a) Minimizing risks in development and extraction of oil and gas field in the future and proving that the early extraction Plan does not affect the efficiency of oil recovery in the whole process of the field development;

b) Making use of commercial and economic advantages at the time of implementation of the early extraction Plan;

c) Making use of extraction facilities built upon implementation of plan for development of oil and gas field in the future.

3. Requirement for early extraction:

a) The early extraction Plan must spcify the reason for implementation, the associated risks in need of study to minimize them and contents to be deployed;

b) The time limit for early extraction does not exceed 03 years from the first commercial product line. Within the time limit for early extraction, the Vietnam Oil and Gas Group will require the operator to make a report on evaluation and change method of extraction to ensure that the early extraction Plan is not detrimental to the last efficiency of oil recovery.

4. The contents of the early extraction Plan include the contents of Plan for development of field.

5. Competence and procedures for approval

a) The Vietnam Oil and Gas Group and the operator will submit the early extraction Plan to the Ministry of Industry and Trade for consideration and approval.

b) The procedures for approval of the early extraction Plan complies with the provisions of relevant legal documents and agreement in oil and gas contract.

Article 7. Opening of reservoir and extraction

1. The operator is not allowed to open the other oil or gas reservoirs other than the early extraction Plan and Plan for development of oil and gas field.

2. The operator only conducts the extraction of oil and gas or field as prescribed by the Petroleum Law, this Regulation and relevant legal provisions.

Article 8. Modification and supplementation of the Plan for development of oil and gas field or the early extraction Plan

1. The operator will carry out the procedures for modification and supplementation of the Plan for development of oil and gas field or the early extraction Plan approved in one the following cases:

a) The operator plans to change the progress of activities of field development; change the rate of investment over 10% compared with the total investment approved by the competent state authorities; change or generate the existing basic equipment items in the field; implement at the reservoir or field the trial program or extraction program different from the Plan for development of oil and gas field or the early extraction Plan approved.

b) The activities of extraction or new geological information indicate the need for change of extraction and development scheme in order to achieve the highest overall efficiency;

c) The increase in oil and gas recovery factor towards achieving higher economic efficiency by applying new methods or technologies.

2. Procedure and competence in approving the modification and supplementation of Plan for development of oil and gas field and the early extraction Plan respectively as specified in Article 5 and 6 of this Regulation.

Article 9. Implementation of Plan for development of oil and gas field and early extraction Plan

1. The operator carries out work items in the Plan for development of field or the early extraction Plan approved under the annual work program approved by the Vietnam Oil and Gas Group.

2. Every year, the operator makes a report to the Ministry of Industry and Trade and Vietnam Oil and Gas Group on the plan for implementation of work items in the Plan for development of oil and gas field or the early extraction Plan and relevant documents.

The plan for implementation of work items includes documents concerning plan on safety, environmental protection and oil and gas resource protection or other documents as required by the Vietnam Oil and Gas Group;

3. Upon completion of the ealy extraction Plan as specified in Article 6, the Operator will have to submit the following reports to the Ministry of Industry and Trade:

a) Result of implementation of the early extraction Plan together with data and analysis demonstrated.

b) Conclusion on the applicability of testing outline for the extraction of the whole field.

Chapter 3.

STUDY OF WELL, RESERVOIR AND FIELD SURVEY

Article 10. Collection and analysis of core sample

1. The operator will have to collect the core sample according to the sampling plan approved by the Vietnam Oil and Gas Group.

2. The operator must preserve and analyze the features and characteristics of core sample to ensure sufficient provision of geological data and parameters in order to evaluate the product reservoir; store and submit these analysis results as agreed by the oil and gas contract. The Vietnam Oil and Gas Group will require the operator to take and analyze the additional core sample in case of necessity.

Article 11. Reservoir survey and testing

1. The operator will submit the plan for well survey and reservoir testing to the Vietnam Oil and Gas Group in accordance with approved plan. The changes if any must be approved by the Vietnam Oil and Gas Group.

2. The operator must conduct the testing of the reservoir in the beginning while putting the well into extraction in order to collect data on the capacity for generating oil and gas products, determine properties of reservoir bed and collect fluid sample of the well.

3. The repair of well may change the capacity for generating oil and gas products or receiving capacity of well, the operator must conduct the study of well to determine the extent of effecting the capacity of product generation or receiving capacity of well right after the completion of repair.

4. The operator will have to make a report to the Vietnam Oil and Gas Group on the result of each reservoir testing right after the performance.

Article 12. Measurement or survey of reservoir pressure

1. Before extraction and injection from each completion part of development well, the operator has to determine the static pressure of reservoir at each part of completion if this parameter has not been determined yet.

2. Within the first 02 years since the reservoir or field has been put into extraction, the operator will have to measure, survey or analyze information about the static pressure of reservoir, product layer and field once for every 3 or 6 months periodically based on the extraction behavior of reservoir, product layer and field. The operator has to agree with the Vietnam Oil and Gas Group on the methods, a number of wells and location of wells necessary for closing to conduct study to ensure the precision of the static pressure of the reservoir.

3. In the following years, the operator will have to submit the plan for survey of reservoir pressure to the Vietnam Oil and Gas Group for appraisal and approval of the plan for survey of reservoir pressure for the next year specifying the methods, a number of wells and location of wells necessary for closing to conduct study to ensure the accuracy of the static pressure of the reservoir.

4. At the proposal of the operator, the Vietnam Oil and Gas Group will consider and approve the study schedule of reservoir pressure of reservoir different from the schedule prescribed above to suit the actual production conditions.

Article 13. Measurement of extraction parameter in the well

1. The operator will conduct measurement of extraction parameter in the well of extraction or injection according to the plan approved by the Vietnam Oil and Gas Group.

2. After the measurement, the operator will report to the Vietnam Oil and Gas Group on the measurement result.

Article 14. Collection and analysis of fluid sample

1. The operator has to collect the sample at the depth or on the surface of at the wellhead for re-generation at the initial reservoir condition in case of failing to collect sample at the depth of the wells whose reservoir is tested or extracted.

2. During the extraction, the operator will have to collect and analyze oil, gas and water sample taken at the wellhead of a number of appropriate wells with sufficient numbers to evaluate the component of fluid of reservoir at least once for every 12 months when there are reasons indicating that the components of fluid extracted from reservoir have changed.

3. The operator will have to collect oil and gas sample in accordance with API RP 44 Recommended Practice (Recommendation of collection of fluid of oil and gas reservoir) of the latest edition or the operator suggests other standards in accordance with international oil and gas practice.

4. When water appears in the fluid from the well which has been put into operation, the operator has to collect sample and analyze water to determine the component of water extracted from well and within the scope of technology permission, evaluate the origin of water extracted from the well.

5. For gas well, the operator has to determine the origin of water which is being extracted. In case the water being extracted is the reservoir water, it is necessary to formulate and immediately carry out the process for determination of flow of reservoir water during the extraction. The operator has to make a report to the Vietnam Oil and Gas Group on the result of performance of the above process right after the result.

6. The water sample taken in the above items must be analyzed in accordance with the API RP 45 Recommended Practice (Recommendation of analysis of water sample of oil and gas field in accordance with international oil and gas practice.

7. The operator has to make a report to the Vietnam Oil and Gas Group on the result of analysis fluid component from each reservoir, the result describing the basic physiochemical properties of that fluid and other information as required by the Vietnam Oil and Gas Group right after the completion of analysis and complete report.

Chapter 4.

OPERATION OF DEVELOPMENT WELL

Article 15. Principle of operation of development well

1. The operator has to complete and operate the development well according to the technical process to ensure the integrity of the well and equipment used in the well for other purposes, safe operation of well, environmental protection, maintenance of evaluation, control of activities of the well and oil and gas recovered from the well efficiently.

2. The operator has to adjust equipment of the well or change the completion part of well if seeing that the condition of the well badly affects the extraction or injection leading to the reduction in final revocery coefficient. If the technical conditions do not allow the performance of these activities, the operator has to report to the Vietnam Oil and Gas Group stating the reasons.

3. For the wells extracted with multiple separate reservoirs, the operator has to perform the following activities:

a) After the completion of well, the operator has to conduct the testing of reservoir separately in order to ensure proper separation between reservoirs including inside and outside the casing.

b) During the following process of extraction, if in doubt about that separation, the operator has to conduct separate testing activities.

Article 16. Approval for operation in well bed

1. For development well, the operator is only permitted to repair and intervene the well, drop geophysical measurement equipment or processing to increase the flow of product upon approval of the Vietnam Oil and Gas Group.

2. Within 30 days before conducting the above activities, the operator has to submit documents related to the process and equipment performed by the contractor to the Vietnam Oil and Gas Group for consideration and approval.

3. The above regulations do not apply for geophysical measurement conducted through the Christmas Tree equipment on the conditions that these activities do not change the completion part of well or cause adverse effect to the oil and gas extraction coefficient of reservoir.

Right after receiving the written approval of the Vietnam Oil and Gas Group concerning the operation of development well, the operator will send a copy of this text to the extraction works.

4. In case of not getting the approval, the operator may perform the above activities if these activities require urgent performance to avoid eruption of oil well or the operator must prove the urgency to conduct these activities before the deadline specified above.

Article 17. Report on well completion and operation

Within 30 days after having completed activities as specified in Article 15 and 16 of this Regulation, the operator will submit the report on activities of well completion and operation including:

1. Summary of activities and incidents which have occurred (if any);

2. Diagram and technical parameters attached of equipment in the well bed, casing, tubing,  Christmas Tree equipment and extraction control system;

3. Parameters of the component and properties of fluid used for well completion;

4. Evaluation of results of activities done.

Article 18. Requirement for installation of casing and tubing

The operator has to ensure that the casing and tubing put in the well are designed accordinig to Vietnamese standards and regulations or other standards in accordance with international oil and gas practice.

Article 19. Part of extraction toroidal rim

1. The operator must not put the offshore well and onshore gas extraction well into operation with the content of 50 parts per million (50ppm) volume when the part of extraction toroidal rim is not separated effectively from the completion part of well.

2. The part of extraction toroidal rim must be structured and installed for easy discharge of well.

3. The operator has to select solution used for the completion or repair of well which is a harmful type at least to the product layer and well bed equipment in accordance with international oil and gas practice.

4. The operator has to install the packer for:

a) The well must be equipped with safety valve of the well bed in accordance with Article 20 of this Regulation;

b) Well with pressure in the space of extraction exceeds 1885,5 Psi.

5. With the wells required to be installed with packer and the operator does not install the equipment to continuously monitor the pressure in the space around the pipe over the packer. Every year, the operator has to check the extent of hydraulic separation between the casing and tubing. The checking data must be kept throughout the life of the project and must be presented on the requirement of the Vietnam Oil and Gas Group.

Article 20. Safety valve of well bed

1. For offshore wells, the safety valve of well bed must be installed at the depth of 30 m below the sea level if:

a) Wells with self-eruption without mechanical assistance;

b) Wells with gas extracted with hydrosunphua content higher than 50 parts per million (50ppm) volume;

2. Với giếng khai thác trên đất liền và có khả năng tự phun không cần hỗ trợ cơ học, van an toàn lòng giếng phải được lắp đặt nếu:

For onshore extraction well which is able to gush itself without mechanical assistance, the safety valve of the well bed must be installed if:

a) The well is located within the range and may cause danger to residents, environment and well equipment due to oil eruption or spill.

b) The well with gas extracted with hydrosunphua content higher than 50 parts per million (50ppm) volume;

3. Technical parameters, design, installation, operation, maintenance, repair and change of safety valve of well bed must be in accordance with:

a) API Spec 14A standard (Technical Standard of safety valve of well bed) and API RP 14B Recommended Practice (Recommendation of design, installation, repair and safe operation of the well bed) in the latest edition or other standards consistent with international practice;

b) Other technical standards proposed by the operator and approved by the Ministries managing sectors and fields.

4. All of the safety valves of well bed which have been installed must be:

a) Tested pressure on the spot immediately after the installation is complete;

b) General inspection at least once for every year, or more frequently if required from actual mining operations.

5. The operator is only permitted to operate the well when the safety valve may be operated normally.

6. The operator is responsible for taking all measures to ensure the safety of the well.

Article 21. Wellhead and Christmas tree equipment

The operator has to ensure the wellhead and Christmas Tree equipment including the valves designed according to international and Vietnamese standard for safe and efficient operation in the maximum load conditions (including but not limited to the expected pressure, thermal stress, mechanical load, corrosion, physical conditions of the environment, etc.) that wellhead and Christmas Tree equipment will bear during the extraction process with the following conditions:

1. Standard: in order for the design to ensure the safe and efficient operation, the wellhead and Christmas Tree equipment including valves, should be consistent with:

a) API Spec 6A standards (Technical standard of wellhead and Christmas Tree equipment) of the latest edition if the well is offshore with the wellhead above the water level;

b) API RP 17A Recommended Practice “Recommendation of design and operation of underground extraction system” and API Spec 17D standard “Technical standard of underground wellhead and Christmas Tree equipment” of the latest edition if the well is offshore with the wellhead below the water level;

c) API Spec 6A standards (Technical standard of wellhead and Christmas Tree equipment) of the latest edition if the well is onshore;

2. The wellhead and Christmas Tree equipment must ensure the design and installation with pressure measurement equipment in all middle parts of casing and temperature of wellhead.

3. After the first installation and after each time of repair, the Christmas Tree must be tested its degree of pressure bearing to the possible maximum pressure during the extraction process.

4. The wellhead damper must be checked at least once every year according to API RP 14H Recommended Practice "Recommendation of Installation, Maintenance and Repair of Safety Valves onshore and offshore" or more frequently if required from actual operation of the field.

Article 22. Other activities in conjunction with extraction operation

The operator is only permitted to drill, complete, repair or stimulate the flow, geophysically measure, pump chemicals or conduct other constructional activities in conjunction with the extraction activities when these are included in the safety Plan approved as prescribed by this Regulation.

Chapter 5.

PROTECTION OF NATURAL RESOURCES

Article 23. Management of oil and gas field

1. The extraction methods proposed in the Plan for development of oil and gas field must ensure economically optimal oil and gas recovery factor according to oil and gas industry practice.

2. The operator has to determine the location and method of well operation to ensure oil and gas recovery factor approved.

3. The additional drilling or artisanal extraction (tertiary) may significantly increase the oil and gas recovery factor towards achieving economic efficiency. The operator has to study these plans and submit them to the Vietnam Oil and Gas Group for approval.

Article 24. Injection for replacement of fluid into reservoir or oil and gas field

1. When extracting oil in the mode of maintenance of reservoir pressure, the operator does not pump the fluid into the reservoir different from the network of injection well and reservoir which has been approved.

2. The operator must not change the amount of fluid injected into the reservoir approved by the Vietnam Oil and Gas Group.

3. The operator must not extract oil and gas with the output at risk of reducing the reservoir pressure lower than the rate of pressure approved in the Plan for development of field.

4. In case seeing that the final oil and gas recovery factor from the reservoir does not decline, the Vietnam Oil and Gas Group will consider and approve the extraction output or inject other fluids with the above requirements

Article 25. Injection of gas back to reservoir

In case the extraction of oil fields with the associated gas output is not sufficient for collection, the operator will have to inject the gas back to the oil and gas field. The plan for back gas injection will be approved by the Vietnam Oil and Gas Group and reported to the Ministry of Industry and Trade.

Article 26. Simultaneous extraction of oil and gas

The operator only conducts the simultaneous extraction of oil and gas from reservoir or field with gas cap upon assurance of oil and gas recovery factor and approval from the Vietnam Oil and Gas Group.

Article 27. Simultaneous extraction of multiple reservoirs

1. The operator must not extract oil and gas from 2 reservoirs or more by a tubing or common one well shaft except for special cases to be approved by the Vietnam Oil and Gas Group. The simultaneous extraction of multiple reservoirs is only accepted when the final oil and gas recovery factor is guaranteed without any effect and maximum limitation of flow exchange between reservoirs.

2. Upon simultaneous extraction of multiple reservoirs, the operator has to measure the total flow of product reservoirs and determine the extraction flow of each separate reservoir.

Article 28. Gas burning and relief

1. The operator only burns and relieves gas in the following cases:

a) During the reservoir testing not exceeding 48 hours with the flow and volume no larger than the flow and volume necessary for relief to swab and clean well.

b) The burning of gas for reservoir testing or after completion, repair or processing of well if planned to last more than 48 hours must be approved by the Vietnam Oil and Gas Group.

c) Periodical burning the residual gas obtained from the processing system which is impossible to collect it economically and the burning does not cause any danger of safety; burning in case of emergency such as the compressor or other equipment is damaged but not exceeding 48 hours; burning upon periodical maintenance, checking and testing.

d) In case of emergency, the operator may relieve gas temporarily if failing to burn it but not exceeding 24 hours and through safety valves;

dd) Burning or relieving gas from well to relieve pressure.

2. For cases not prescribed in Clause 1 of this Article, the operator will submit them to the Ministry of Industry and Trade for consideration and approval.

3. The operator will submit the plan for burning of associated gas to the Ministry of Industry and Trade for consideration and approval for each year for each oil field.

Article 29. Oil burning or destruction

1. The operator carries out the oil burning or destruction in case of emergency or seeing that the burning or destruction of oil is necessary upon the beginning of completion or repair of well or in case of processing stimulus of flow increase on condition that the volume of oil burnt or destroyed is less than 1m3/h and must ensure environmental safety upon oil burning or destruction as prescribed by law.

2. The operator will inform in writing to the Vietnam Oil and Gas Group upon oil burning or destruction and must have plan to deal with cases of emergency.

3. During the well testing, the operator only burns or destroys oil in accordance with the volume approved by the Vietnam Oil and Gas Group.

Chapter 6.

EXTRACTION OUTPUT

Article 30. Principle of oil and gas extraction

The operator must extract oil and gas with the logical method of extraction according to the practice of oil and gas industry and appropriate technology with the feasibility proven in order to obtain the oil and gas recovery factor with stable extraction output according to the Plan for development of field approved.

Article 31. Forecast of extraction output

1. Based on the rate of extraction output approved in the Plan for development of field, the operator has to submit the forecast of oil and gas extraction capacity for the following years and update the forecast of extraction through the life of field for each reservoir before October 01 of each year.

2. Forecast of extraction capacity for the first year must calculate by each month on the basis of each well. The extraction forecast for the next 04 years must calculate by each quarter and long-term forecast of the entire life of the field must be calculated by each year. If the change of forecast of annual extraction output exceeds the limit of ±10%, the operator has to explain in writing to the Vietnam Oil and Gas Group.

3. For long-term forecast of oil extraction, the final oil recovery factor with the error exceeding 15% compared with the final oil recovery factor approved in the Plan for development of field, the operator will supplement the studies of field to ensure the final recovery factor as calculated is not declined.

Article 32. Approval of extraction output

1. The Vietnam Oil and Gas Group will approve the extraction output quarterly and annually.

2. The operator has to prepare the actual production conditions and product distribution, including measures to pump gas back into the field, minimizing the gas burning and relief to ensure the feasibility and maintain the expected extraction output in each specific phase.

3. In case of technical reasons, technology or force majeure that the output of the field fluctuates at the rate of ± 10% or more compared with the approved output, the operator has to explain the changes in writing.

4. Within 30 days after the significant changes of extraction flow, the operator has to make a report to the Vietnam Oil and Gas Group to formulate necessary solutions including the planning, additional study to ensure the output as planned. After applying the above measures but failing to achieve the desired result, the Vietnam Oil and Gas Group may consider the rate of extraction accordingly.

5. During the year, if there is a change in the output due to one or more causes during the manufacturing process, then each quarter, the operator will notify the Vietnam Oil and Gas Group of the change in monthly extraction output changing for each quarter. In that case, the operator will present the following documents  at least one month prior to the turn next quarter:

a) Expected extraction capacity for each subsequent quarter;

b) The expected average and monthly actual average extraction output of the field before and remaining quarters of the year;

c) Formulation of chart of actual oil output extracted in comparation with the oil output approved, formulation of chart of gas volume pumped back into the reservoir, actual burning and relief compared with the actual volume of gas pumped back into the reservoir, burning and releasing as approved since the year with explanation about the excess of the limit of ± 10% or greater between actual oil extraction output with the extracted oil output approved and the gas volumes burnt, released and pumped back into reservoir in excess of the allowed limit.

6. The Vietnam Oil and Gas Group will condider and approve the maximum output for each well or field based on the technical conditions, actual extraction technology of that well or field.

Article 33. Excesive and insufficient oild output

1. The operator will have to take measures to achieve the approved oil output. When there are objective causes, the actual extraction output is permitted for change within ±10% of monthly average oil output approved for one field on condition that the actual extraction output of the contractual area having that field does not change over ±5% compared with the monthly average output approved if the contractual area has two fields or more.

2. In case the adjustment of extraction output exceeds 10% for the field or 5% of output approved for contractual area having two fields or more.

3. In case, there are months with excessive or insufficient output, the operator will have to adjust the output of the following months so that the cumulative output still ensures the output approved or the adjustment approved for that year.

Article 34. Extraction output of natural gas

1. For natural gas, the operator will submit the report on forecast of natural gas extraction output for each field on the basis of demand for gas use for the subsequent years before October 01 of each year. Those forecasts must comply with the provisions in Article 31 of this Regulation.

2. The operator must not extract natural gas different from annual gas sale and purchase contractwith the customers in proportion to the extraction output approved in the Plan for development of field.

In case there is requirement for change or supplementation of gas output in addition to the scope above mentioned, the operator will have to make a report to the Vietnam Oil and Gas Group for appraisal and approval.

Article 35. Extraction of associated gas

1. The operator has to submit the forecast of extraction and associated gas use plan for each oil field together with oil extract plan specified in Article 32 of this Regulation.

2. The operator has to ensure the monthly average oil-gas ratio does not exceed the approved limit.

3. In case the oil-gas ratio is higher than the approved limit, the operator will carry out the subsequent extraction activities after getting the approval of the Vietnam Oil and Gas Group;

4. The Vietnam Oil and Gas Group will consider and modify the limit of oil-gas ratio for each oil field on the basis of technical information and latest studies in the year or in accordance with the limit of volume of gas pumped back into the reservoir or relieved.

Article 36. Allocation of extraction output

The operator has to distribute the oil extraction output by each month from the well cluster of the field on the basis of scaling of each well in accordance with the flow division system and the process of allocation agreed with the Vietnam Oil and Gas Group.

Chapter 7.

MEASUREMENT AND CHECK

Article 37. General provision

1. The operator has to measure and store data of flow, total output of each type of fluid extracted or injected into the well, sold, burnt or destroyed.

2. The operator will measure and store data of flow, total output of gas used as raw material for extraction activities in the field and requires the extraction by the method of gas lift.

3. The operator has to measure and store data of flow, total output of crude oil used as liquid to be the hydraulic energy for mechanic extraction equipment.

4. The operator has to measure and store data of flow, total output of each type of fluid in and out the processing department in the field.

Article 38. Flow measurement equipment

When the operator uses the measurement equipment to measure the flow of fluid  as specified in Article 37 of this Regulation, this equipment must meet the following requirements:

1. The valves, instrumentation, calibration tubes, and other auxiliary equipment installed and used must conform to the instructions of the equipment manufacturer, the relevant national and international standards to maintain stable flow logically through the measurement equipment to ensure safety.

2. There is measurement range corresponding to the use purpose; proper operation in the selected measurement part.

Article 39. Commercial gas flow meter

When using the commercial gas flow meter used in extraction activities, the meter must be compatible with measurement equipment of temperature, pressure and component of fluid in a continuous manner or adjustment equipment of these parameter to ensure the precision of the measurement.

The operator will submit the following information to the Vietnam Oil and Gas Group:

1. The technical parameters the meter include the minimum and maximum flow, pressure and working temperature, material for fabrication of meter and process of installation;

2. A detailed list of pressure and temperature bearing components or gravity force adjustment components, accessories for deironing, dewatering, degassing, equipment for sampling, volume recording equipment or control equipment used in conjunction with the meter;

3. A detailed list of actual working conditions of the meter including the flow measurement range, determining that the flow is continuous or interrupted, maximum pressure, and pressure and temperature measurement range.

4. Detailed document about the precision of the meter, the equipment and necessary calibration process;

5. Certificates of measuring equipement inspection of national and international competent authorities;

6. Copies of all reports on meter adjustment.

Article 40. Calibration of flow measuring equipment

When using equipment to measure total flow, water, gas, the operator will calibrate and maintain the calibration of all measuring equipment according to the standard and periodical regulation approved by the Vietnam Oil and Gas Group.

Article 41. Measurement of condensate and crude oil

1. When using measuring equipment of operation by the rotation principle or occupancy principle to measure condensate and crude oil, the operator will calibrate all of measuring equipment and maintain the calibration of all measuring equipment according to the standard and periodical regulation approved by the Vietnam Oil and Gas Group.

2. When using the measuring equipment by the principle of pressure drop in flowing fluid to measure condensate and crude oil, the operator has to install a self-recording equipment compatible with this equipment.

Article 42. Dossier of measurement activity

The operator will keep books, record reports, data and results of periodic inspection on measurement activities for each measuring equipment of gross flow or flow checking equipment that the operator will use for the whole life of project. During that time, the competent state agency, the Vietnam Oil and Gas Group may require the operator to submit these books and records.

Article 43. Precision of substitution measurement or measurement adjustment

1. The permissible minimum precision for the measurement of monthly total oil and gas output in the extraction area must meet the requirements of the Vietnam Oil and Gas Group.

2. The operator has to determine the flow of each well with sufficient frequency to ensure minimum precision.

3. The operator has to check the precision of the measuring equipment which is being used and make a report on the result of inspection to the Vietnam Oil and Gas Group as required.

4. On the requirement of the competent state authorities, the Vietnam Oil and Gas Group, the operator will replace or calibrate any measuring equipment which does not satisfy requirement for precision in accordance with provisions in this Regulation.

Chapter 8.

BUILDING OIL AND GAS EXTRACTION WORKS

Article 44. General requirements on technical quality and safety and environment for oil and gas extraction works

1. The operator is only permitted to put the oil and gas extraction works into operation after receiving certification of technical quality and safety and environment as prescribed by Vietnamese law and international Conventions of which the Socialist Republic of Vietnam is a member.

2. For offshore oil and gas extraction works, the operator has to comply with the following provisions:

a) Fixed platform must be designed, built, equipped and installed in accordance with Vietnam Standard “TCVN6171 and TCVN6767 – Fixed offshore structures”;

b) Mobile platforms must be designed, built, equipped and installed in accordance with Vietnam Standard “TCVN 5309 ÷ TCVN 5319 –  Mobile offshore structures”;

c) The floating repositories should be designed, built, equipped and installed in accordance with Vietnam Standard “TCVN 6474 – Rules for the decentralization and technical supervision of floating repository";

d) The marine piping systems must be designed, built, equipped and installed in accordance with Vietnam Standard “TCVN6475 ÷ TCVN6475-13-  Rules for the decentralization and technical supervision of marine piping systems.

dd) The anchor buoys must be designed, built, equipped and installed in accordance with Vietnam Standard “TCVN6809-  Rules for the decentralization and fabrication of anchor buoy”;

e) The international Conventions include: The International Convention for the Safety of Life at Sea 1974 (SOLAS, 74); the International Convention on Load Lines 1966 (LOAD LINE, 66); the International Convention for the Prevention of Pollution From Ships (MARPOL, 73/78); The International Regulations for Preventing Collisions at Sea 1972 (COLREG, 72); the International Convention on Tonnage Measurement of Ships, 1969 (TONNAGE, 69); the Code for the Construction and Equipment of Offshore. Drilling Units (MODU Code) or other standards approved by the Ministry of Transport.

g) The extraction works are built and installed to make the oil and gas extraction safe, economically efficient and consistent with international standards.

3. For onshore oil and gas extraction works, the operator must perform activities as prescribed by law.

4. The oil and gas extraction works may be designed, built, equipped and installed according to other technical standards proposed by the operator and approved by the specialized state management agencies.

Article 45. Safety system on extraction works

1. The operator is only permitted to use wellhead system and oil and gas extraction equipment, processing equipment, separation vessels, pressure vessels, pumps, compressors, pipelines and valve manifold when these equipment is protected by safety system. This system must be in good operating condition during oil and gas extraction.

2. The safety system must be designed to maximally limit the potential for human injury, environmental damage and damage to extraction works when the equipment has problems.

3. The safety system must automatically detect the dangerous or abnormal signs related to the protected equipment. Based on the reliable fault detection system, the safety system will stop operating the whole or any part of the works.

4. The operator is only allowed to use offshore extraction works when the safety system for the works is designed and installed in accordance with Vietnam standard and regulation. In case Vietnam has not issued standards and regulations in this area, the operator will apply international standard but the application of that standard is not contrary to the law of Vietnam and ensure the safety.

Article 46. Emergency shutdown valve

1. The operator must install emergency shutdown valve at the wellhead and Christmas Tree in the following cases:

a) Product extraction well contains hydrosunphua with the content above 50 parts per million (50ppm) volume;

b) Well in offshore extraction area;

c) It is necessary to disconnect fluid lines from the well by problems in the pipeline or injection pipeline likely causing harm to people or seriously destroy natural environment,

2. The operator must ensure that all emergency shutdown valves installed in the well are in accordance with Vietnam standard and regulation. In case Vietnam has not issued standards and regulations in this area, the operator will apply international standard but the application of that standard is not contrary to the law of Vietnam and ensure the safety.

Article 47. Product processing equipment

The operator is only permitted to use collector pipe, separation vessels, pressure or fire vessels which are designed and installed under Vietnam standard “TCVN6153 ÷ TCVN6156 – Pressure vessel” or other technical standards in accordance with international practice.

Article 48. Pressure relief system

1. At extraction works, the operator has to connect pressure relief valves and liquid hydrocarbon processing equipment with the decanter or tank large enough to contain the largest liquid volume which may escape before the system is securely closed.

2. At extraction works, all pressure relief valves in gas processing equipment must be connected with the gas burning or relief system.

3. At extraction works with the content of hydrosunphua in extracte fluid in excess of 10 parts per million (10 ppm) volume, the extraction works must be installed with gas burning system regularly operating.

Article 49. Alarm system

1. The operator is only permitted to extract oil and gas when the extraction works are equipped with the alarm equipment that warns people in the works in situations likely causing danger to people, works or harm to natural environment.

2. When installing extraction works, the operator must ensure the operation instructions at the works, including:

a) The written description of the alarm system and the methods used to identify the types of alarm;

b) The written description of the alarm signs

c) The mounting position of fire detection, smoke and gas leak equipment;

d) The written description of power supply of alarm equipment;

dd) Maintenance and calibration of alarm equipment;

e) A number of and position of portable equipment used for gas detection.

3. All alarm systems on extraction works must ensure regular, continuous and highly reliable operation, frequently checked, maintained and designed against disturbance.

4. When the automatic alarm system of extraction works isunder check, maintenance or repair, the operator has to ensure that all functions of the system is maintained through manual control system or substitute preventive measures guided in the operating procedures or emergency situations.

Article 50. Communications system

1. The extraction areas with the handlers must be equipped with radio or telephone system and emergency communications system and the above communications system must be in continuous operation.

2. The offshore extraction works must be equipped with two-way communications system with the radio system regularly maintained between the offshore works with the onshore operation center, with rescue ships and with any the other offshore extraction works nearby and with the marine means of transport in the nearby area.

3. The offshore extraction works with the handlers must be equipped with the text transfer means to the onshore operation center and internal telephone system as well as general information system with the speakers to be placed so that all people everywhere on the works may receive can work on getting the information emanated.

4. The offshore uninhabited extraction works must be:

a) Equipped with information system with two-way radio during the time people work there;

b) Equipped with system capable of detecting all bad situations which may occur to endanger the works, natural environment and notification and information to the operation center.

Chapter 9.

SAFETY, ENVIRONMENT AND EMPLOYEE TRAINING

Article 51. Recording and reporting of physical environmental condition

1. For offshore extraction works, the operator has to maintain general recording of natural environmental observation during the field extraction of each working shift under the form with information meeting requirements of this Regulation and approved by the Vietnam Oil and Gas Group.

2. For onshore extraction works, the Vietnam Oil and Gas Group will require the operator to monitor and record the wind direction and speed, temperature and precipitation on a certain timetable.

3. For offshore works, the operator has to observe and record:

a) At least once a day in normal conditions and at least 3 hours in stormy conditions: wind direction and speed, direction, height and wavelength of the sea waves, direction and velocity of flow, pressure and atmospheric temperature, sea temperature, distance vision;

b) Recording total precipitation of the previous day once a day.

4. The operator of floating extraction platform has to observe and record the inclination, rocking and bobing of the extraction system and the tension of each anchor rope at least once for every 6 hours when the wind speed is less than 35 km / hour and at least once for every 3 hours when wind speed exceeds 35 km / hour.

5. For offshore extraction works, during the time of production activities, the operator has to record the meteorological forecast of each day and when the meteorological conditions of the day change compared with the forecast.

6. Before March 1 of each year, the operator has to make a report to the Service of Natural Resources and Environment, Ministry of Natural Resources and Environment on assessment of environmental condition of the last year. For the offshore extraction area, the report on assessment of environmental condition must include the general assessment of hydrological and oceanic conditions, as well as the downtime due to weather conditions.

Article 52. Environmental impact assessment and environmental survey

1. Before developing oil and gas field, the operator will make a report on environmental impact assessment and submit it to the Ministry of Natural Resources and Environment for consideration and approval.

2. During the extraction process, the operator has to survey and monitor the quality of water and sediment environment of the field area. For onshore extraction activities, the survey of both air and underground water is carried out; diagram, frequency and parameters to be surveyed and monitored under the environmental management program approved by the competent state authorities in the report on the environmental impact assessment for oild and gas field development and regulations of law.

3. The operator has to survey and monitor working environment in the oil and gas extraction works as prescribed by law.

Article 53. Environmental protection in works construction

The operator has to build or install works or each part of extraction works in accordance with design and construction to ensure the efficiency in use and reduce to the lowest level the influence on seafloor surface, river bed, soil, creatures or the natural environment.

Article 54. Waste collection and treatment

The operator has to ensure that all wastes generated during the extraction must be collected and treated as prescribed by law.

Article 55. Extracted water and industrial wastewater

1. The operator must not operate any discharge system of extracted water or other industrial wastewater treatment systems if these systems are not designed and maintained to ensure the value of oil content in water and limit of contamination are lower than or equal to the monthly average value or maximum value of the day as prescribed by Vietnamese law on environmental protection for oil and gas activities and other relevant Vietnam standards.

2. The operator has to set up the process of logical sample taking and analysis to ensure the fair honest feedback on the treatment condition, quality of extracted water and industrial wastewater better treated or in accordance with standard and regulation of Vietnam environment.

3. The operator must not discharge the extracted water into the surface water or into the water reservoirs which may be used for domestic water supply.

4. When the extraction is performed onshore, the operator is only permitted to discharge the extracted water and industrial wastewater under the diagram of report on environmental impact assessment approved by the competent state authorities.

5. The operator is only permitted to operate the discharge system of extracted water into the reservoir once ensuring no environmental pollution or with support for maintenance of reservoir pressure and approved by the competent state authorities.

Article 56. Equipment, maintenance and replacement of equipment

1. The operator is responsible for immediate repair or replacement of equipment which is being used in the extraction works and has broken down causing unsafety to people and equipment there.

2. The operator will prepare supporting programs with the advanced technology required to control the level of mechanical and chemical corrosion of the components of the extraction works process and the pipe arm and wellhead in extraction works and report the Vietnam Oil and Gas Group as required.

Article 57. Operation stoppage

1. The operator must stop all extraction activities in the following cases:

a) When extraction activities causes serious accidents and incidents;

b) When the continuation of extraction activities may cause serious unsafety to people working and extraction works or violate regulations of law on waste and environmental protection;

c) When there are people seriously injured likely causing other serious consequences or incidents causing serious damage to equipment;

d) When a well in the extraction area is lost its control or in danger of loss of control, the operator must close the wells in that extraction area operating until the above risks are remedied.

2. The operator only continues extraction activities again upon completion of adjustment, repair to meet requirements of law on safety and environmental protection certified by competent state authorities.

3. In other special cases, the operator is only permitted to stop extraction activities of one well or field in accordance with the plan approved by the competent state authorities. The maintenance or abandonment of well must comply with regulations of law and ensure safety of natural resources and environment.

4. Activities of field or reservoir extraction are considered finished when the Plan for field clearance is completed and approved by the Ministry of Industry and Trade.

Article 58. Staff capacity

1. Before assigned with tasks, the employees working for the operator must be trained and have sufficient knowledge, appropriate degrees or certificates of practice to safely carry out their assigned tasks.

2. On the requirement of the Vietnam Oil and Gas Group, the operator has to provide the summary of background and experience of any employee, technician and supervisor working in the extraction area.

Article 59. Training

When the extraction activities require the use of people with special skills, the operator will submit the additional training program planned for employee training to the Vietnam Oil and Gas Group. The operator has to ensure that the people selected to be trained under the approved program must have adequate capacity for the course completion.

Article 60. Coaching, training and exercise safety and environmental protection

1. The operator has to formulate a training plan for health safety and environment specifically for each title, determine the training frequency, purposes, requirements and contents of the training for each training subject to ensure that all people working in the extraction works must understand and be proficient in safety processes for people and their responsibilities in implementing the incident prevention plan as well as the plan for evacuation out of the extraction when necessary. The employees working for the recruitment operator must be given information for understanding and implementation of regulations on environmental protection in daily activities.

2. At least once every 12 months, the operator of extraction works must hold a practice for those who work in the works concerning the emergency response and oil spill response.

3. The operator will organize again the practice of any process which is applied in the extraction works if deemed unsafe and notify all people concerned to participate in the practice. In case of necessity, the operator will add the safety programs practiced again into the book of safety instruction.

Chapter 10.

PRODUCTION ACTIVITIES RELATING TO OIL AND GAS EXTRACTION

Article 61. Requirements for equipment

1. The operator ensure that the equipment and machinery used in the extraction works must be certified the environmental and technical safety quality as prescribed by law and international convention of which the Socialist Republic of Vietnam is a member.

2. The equipment and machinery must have a control system and safety system for environmental protection, be installed and operated in order to reduce the noise to a minimum rate to avoid harm to people and animals.

3. The equipment and machinery must be installed so as to minimize the risk of danger to the extraction works or to the working people, minimize to the lowest level of environmental destruction and installed conveniently for use.

Article 62. Requirements for check of valves, sensing devices and the related reports

1. For onshore extraction works, the operator has to conduct the following tasks:

a) Testing at least once for every 6 months the emergency shutdown valve systems at the wellhead testing all emergency shutdown valves at wellhead;

b) Testing at least once for every 12 months the safety valves of the pressure vessel installed at the well or at extraction works.

c) Testing at least once for every 3 months the pressure sensors;

d) Testing at least once for every 3 months the liquid level control equipment by activating the sensing devices.

dd) Testing at least once for every 3 months the automatic shutdown valves connected with the compressed air pump or at the input of the pressure vessel, testing the automatic shutdown valves operating on the principle of shutdown at the lowest level in the pipelines

e) When the onshore extraction works have installed the oil or gas processing equipment, the operator has to test all safety valves of the above equipment at least once for every 12 months.

2. For offshore extraction works, the operator has to conduct the following tasks:

Annually checking and testing all parts of the safety system ofworks by Vietnam standards " TCVN – 6171 – Fixed offshore structures", “TCVN 5309 ÷ TCVN 5319 - Mobile offshore structures", "TCVN 6474 - Rules for the decentralization and technical supervision of floating repository"; "TCVN 6475-1 ÷ TCVN 6475-13 - Rules for the decentralization and technical supervision of marine piping systems, TCVN6809 – Rules for the decentralization and fabrication of anchor buoy”.

3. In case of trial operation of works, the equipment specified in Clause 1 and 2 of this Article but detecting those equipment are broken or not precisive, the operator has to replace them or prepare all valves and sensing devices immediately.

4. The operator has to report to the Vietnam Oil and Gas Group on unsuccessful testing or detection of error or breakdown of any equipment in the safety system of the works no later than 30 days after the end of the trial.

Article 63. Supporting means

1. The operator only uses the supporting means which are designed, fabricated and maintained and capable of operating safely in natural environment conditions forecasted in that area.

2. The operator only uses the supporting means which have been registered, decentralized and issued with technical certificate of marine safety and security and prevention of environmental pollution as prescribed by law and international convention of which Vietnam is a member

3. The person in charge of supporting means has to inform the people getting on supporting means of regulations on safety applicable to these means.

Article 64. Ship on duty at the field

1. The operatoe of offshore extraction works with handler must have ship on duty at the field continuously operating to ensure prompt rescue in case of emergency.

2. Ship on duty at the field must ensure the following standards:

a) Having sufficient temporary shelter for the people of the extraction works in the event of evacuation;

b) Having first-aid equipment and medical personnel qualified for first aid to the injured people;

c) Having capacity to save those who fall into the sea near the extraction works;

d) Being equipped to act as a communications center in case of emergency to ensure communications between the extraction works with other ships and the extraction works in the vicinity, with the means of rescue, bases and means of rescue onshore.

3. The operator of offshore extraction works with handler must ensure that the ship on duty at the field is always available for support and rescue of people in the extraction works in case of emergency and moves closely to the extraction works if necessary for prevention and rescue in the following cases:

a) Helicopter taking off or landing;

b) There are people working on the side;

c) There are people working in the water edge or in the water;

d) Helping the extraction works avoid the risk of bumping or collisions and other dangerous threats.

Article 65. Transport

The operator has to ensure the transport of people and goods to and out of the extraction works is carried out safely and in accordance with current regulations of law.

Article 66. Communications

1. The operator of offshore extraction works with the handler has to ensure that the communications equipment in there is able to continuously operate and the person on duty of receiving and giving information has skills and level of control.

2. There must be someone on duty to give and receive information 24 hours a day continuously to perform the following tasks:

a) Monitoring, receiving and hearing on the radio with the frequency 156.8 MHz (channel 16), the frequency 156.525 MHz (channel 70) and recording the information relating to safety and emergency situations;

b) Tracking information and notice on the sea and in the air relating to any movement of supporting means operating between the offshore extraction works with the mainland.

Article 67. Positioning undersea

For offshore extraction system, the operator has to install equipment and ensure the ability to position any underground system that lies below sea level.

Chapter 11.

RIGHT OF ENTRY AND SUPERVISION AND INVESTIGATION

Article 68. Right of entry

1. Except in case of emergency, only the following people will be allowed to enter the onshore extraction area and safe areas on the offshore extraction works:

a) People of extraction team or people allowed by the operator;

b) Representative of the Vietnam Oil and Gas Group or of the competent state authorities to carry out the tasks of inspection and monitoring of field extraction;

c) Person appointed by the Vietnam Oil and Gas Group but there must be the person of the operator accompanying;

d) Inspection teams or inspectors under the provisions of law.

2. The operator of offshore extraction works has to take reasonable measures to ensure that the vessel or aircraft operator operating in or moving towards the safety area of works to identify the boundaries of safety area and comply with regulations of law.

3. Other special cases of entry will be prescribed by the competent state authorities.

Article 69. Equipment checking and remedial measures.

1. When representatives of the competent authorities of Vietnam have the grounds to confirm that the working conditions of the equipment used for oil and gas extraction may cause death or serious injury to persons working in the works, or at risk of not controlling the well or environmental pollution, the representative of the competent authorities of Vietnam may notify in writing to the operator and require to test the features of equipment;

2. When re-testing the devices if finding that these devices do not comply with the technical parameters specified in the operating manual, the operator has to replace or repair them immediately.

3. Where there is no ability to test the equipment to ensure the safety and Vietnam Oil and Gas Group Moderators asked to check or replace them immediately.

Article 70. Investigation of accidents and incidents

1. The competent state authorities or the Vietnam Oil and Gas Group will investigate any incident or event occurring at the extraction area if seeing that event may cause remarkable destruction or damage of extraction equipment or overflow of fluid into the natural environment exceeding permissible limit of this Regulation or the approved limit or cause casualties to the employees in the extraction works.

2. In other cases if necessary, the competent state authorities will set up an inspection team as prescribed by law.

Chapter 12.

RECORDING AND REPORTING

Article 71. Measurement unit

The operator must use the unit system as prescribed by law on measurement to record data and in the reports for submission to the competent state authorities or the Vietnam Oil and Gas Group. In special cases, the operator will use other units but they must be converted into the unit as prescribed by law

Article 72. Recording serious incidents or accidents

1. The operator must immediately inform the Vietnam Oil and Gas Group by the fastest means of communications of the serious incidents or accidents occurring in the extraction works.

2. After informing the Vietnam Oil and Gas Group upon occurrence of accident or incident, the operator must immediately report in writing of such accident or incident to the Vietnam Oil and Gas Group specifying the happening, remedial measures, extent of damage and treatment experience.

3. The Vietnam Oil and Gas Group will report to the competent state authorities for handling, monitoring and remedy as prescribed by law.

Article 73. Name and naming of field and well

1. The Vietnam Oil and Gas Group stipulates and approves the naming of reservoir, product layer or field.

2. The Vietnam Oil and Gas Group approves the boundaries of reservoir, product layer or field submitted by the operator.

The operator must use the name of field, product layer or field approved in all reports, records and other documents required by the Vietnam Oil and Gas Group.

3. The operator names the well completed to put it into operation in the following order:

a) The fixed name including abbreviated name of field and product layer where that well is opened its reservoir;

b) The variable name indicating type of well and well conditions by regulations as follows:

Active well named with the letter O;

Suspended well named with the letter S;

The abandoned well is named with the letter A;

Injection well named with the letter I;

Extraction well named with the letter P;

Body-cutting well named with the letter ST;

Article 74. Construction progress

The operator will annually submit a general report on construction progress and significant events occurring during the construction or installation of extraction works in the month to the Vietnam Oil and Gas Group. When required, the operator will report on the construction progress and installation of extraction works every day.

Article 75. Recording production activities

The operator will store and provide the competent state authorities and the Vietnam Oil and Gas Group upon requirement with the following documents:

1. Coaching safety skills and provision training courses;

2. List of people working in the extraction area at any time;

3. The movement of supporting means;

4. The inspections, repairs, modifications or brokedown of equipment;

5. The examination of corrosion and erosion of the extraction system and maintenance results;

6. Loss of fuel or oil and other escaping chemicals;

7. The data on pressure, temperature, flow of compressor, means and handling equipment;

8. Calibration of measuring devices and other devices;

9. Checking of safety valve on the surface and safety valve in the well;

10. Operating conditions of wells;

11. The extraction flow of the wells over time and the loss of oil and gas or chemicals into the natural environment;

12. Other relevant documents

The operator has to store the above documents during the term of oil and gas contract and submit them to the Vietnam Oil and Gas Group at the end of oil and gas contract.

Article 76. Recording of extraction activities

1. The operator has to record and store data of extraction of reservoir, product layer and field and submit these documents upon the requirements from the competent state authorities or the Vietnam Oil and Gas Group.

2. The operator has to record and report to the Vietnam Oil and Gas Group on the detailed extraction output of each day, month, quarter or year of each well, reservoir, product layer and field.

3. The operator has to store the above documents until the end of field extraction.

Article 77. Monthly extraction report

1. Before the 10^th date of each month, the operator has to submit three (03) copies of the report on extract situation after allocation of output of the previous month under the prescribed form to the Vietnam Oil and Gas Group.

2. The operator has to comply with the process of calculation of extracted output according to the text approved by the Vietnam Oil and Gas Group.

Article 78. Monthly report on oil and gas processing

Within the first 10 days of the month, the operator of oil and gas processing station will submit three (03) copies of report on situation of oil and gas processing particularly specifying the volume which has been processed of the previous month under the prescribed form.

Article 79. Yearly extraction report

1. Before March 01 of each year, the operator will submit the report on annual extraction report on reservoir or field of the previous year.

2. Annnual extraction report as prescribed above includes:

a) Diagram of extraction and injection of reservoir or field;

b) Evaluation of situation of extraction of each well, reservoir or field;

c) Evaluation of extraction capacity of each reservoir or field;

d) Estimate of the degree of extraction reduction of the reservoir or field;

dd) Detail of conditions of reservoir;

e) Evaluation of waterlogged situation of products;

g) A summary of the testing and studies related to the conditions of wells and extraction equipment of reservoir or field;

h) Evaluation of activities of safety valves in the well;

i) List of major changes of any extraction works in the reservoir or field.

3. When the operating condition of the well or reservoir is different compared with the forecast in the annual report of that well or reservoir, the operator will have to submit a report on evaluation of well condition for each stage required by the Vietnam Oil and Gas Group.

4. In the annual extraction report, the operator will describe in detail the geophysical measurement activities conducted in the development well.

Article 80. Data report

The operator will submit three (03) copies of the result, data, analysis and diagram under the prescribed form within 30 days after completion of the following activities:

1. The testing, measurement, counting or geophysical analysis or fluid samples are in accordance with Chapter III of this Regulation;

2. The trial separation or well operation is under the provisions of Chapter IV of this Regulation.

Article 81. Storage and assurance of confidentiality of information and documents

1. All information, documents and samples in accordance with this Regulation must be presented or submitted to the Vietnam Oil and Gas Group. The Vietnam Oil and Gas Group will store and keep confidentiality of all information, documents and samples presented or submitted to request the approval for the Plan for development of field, the early extraction Plan or the right to conduct the extraction activities.

2. The competent state authorities and the Vietnam Oil and Gas Group may use information, documents and sample submitted by the operator for the purpose of management of natural resources of oil and gas for the state management and economic development.

Article 82. Right to publish and disseminate information

1. Without the consent of the Vietnam Oil and Gas Group, the parties concerned must not publish information related to the Plan for development of field, the early extraction Plan all other extraction activities.

2. When necessary, the Vietnam Oil and Gas Group has the right to inform the parties concerned of essential information including the name, location of field, well or extraction works the operator uses and extraction condition of reservoir or field.

3. The Vietnam Oil and Gas Group will publish the information relating to the environmental studies or plans for incident prevention when necessary.

4. The Vietnam Oil and Gas Group will publish information about extraction activities directly relating to safety activities in the area after notifying the operator.

Article 83. Violation handling

Tổ chức, cá nhân vi phạm quy định Quy chế này sẽ bị xử lý theo quy định của pháp luật Organizations and individuals violating the provisions of this Regulation will be handled as prescribed by law./.