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DZ 3: Petroleum mining: development expenditure from 1 October 1990 to 15 December 1991
or “Petroleum miners can claim expenses for development between 1 October 1990 and 15 December 1991”
You could also call this:

“Rules for claiming costs on abandoned oil exploration wells before December 1991”

If you’re a petroleum miner, you can get money back for costs you had before 16 December 1991 when you drilled, tested, completed, and gave up on a well you were exploring. This is only if you sealed and abandoned the well before it started making money, and if you haven’t already got money back for these costs in an earlier year.

To seal and abandon an exploratory well, you need to make a special promise. This promise says you won’t use the well for mining petroleum or ask for special permission to mine in the area where the well is.

You get this money back in the same year that you seal and abandon the well.

Even though this rule lets you get money back for something that usually counts as a big, long-term expense, you still need to follow the other usual rules about what you can get money back for.

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Next up: DZ 5: Farm-out arrangements for petroleum mining before 16 December 1991

or “Rules for pre-1991 petroleum mining farm-out arrangements”
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Part D Deductions
Terminating provisions

DZ 4Expenditure on abandoned exploratory well before 16 December 1991

  1. A petroleum miner is allowed a deduction for expenditure that they incur before 16 December 1991 in drilling, testing, completing, and abandoning an exploratory well if—

  2. the miner seals and abandons the well before commercial production from the well starts; and
    1. the expenditure has not been deducted in any earlier income year.

      1. To seal and abandon an exploratory well, a petroleum miner must make a declaration under the Oaths and Declarations Act 1957 that they do not intend—

      2. to use the exploratory well in petroleum mining operations; or
        1. to apply for an existing privilege that is a mining licence under Part 1 of the Petroleum Act 1937 over the area containing the exploratory well.

          1. The deduction is allocated to the income year in which the well is sealed and abandoned.

          2. This section overrides the capital limitation. The general permission must still be satisfied and the other general limitations still apply.

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          Notes
          • Section DZ 4(2)(b): amended (with effect on 1 April 2008 and applying for the 2008–09 and later income years), on , by section 112(1) of the Taxation (Annual Rates for 2015–16, Research and Development, and Remedial Matters) Act 2016 (2016 No 1).