PEANZ Advocates Easier Tax on Offshore Rigs

An easing of a taxation disincentive for offshore rigs to make long stays in New Zealand waters is being advocated by the Petroleum Exploration Association of New Zealand.

Mike Patrick, executive officer of PEANZ says that it is seeking to reduce or eliminate the tax complexity for rig operators which adds to mobilization and demobilization costs. Currently non-resident contractors New Zealand income tax if they stay in New Zealand waters for more than 182 days in any rolling 365-day period.

PEANZ has asked for similar tax treatment as luxury yachtsman now get, namely no income tax until contractors have spent a consecutive 365 days in local waters over any 2 years. This would encourage rigs to drill multi-well programs for longer than 6 months.

Meanwhile, Swift Energy New Zealand CEO Don Morgan and Westech Energy (NZ) director Kevin Johnson have been re-elected as chairman and vice-chairman of PEANZ to serve a second one-year term.