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Revised Statutes of Newfoundland 1990
AN ACT RESPECTING THE NEWFOUNDLAND AND LABRADOR PETROLEUM CORPORATION
1. This Act may be cited as the Petroleum Corporation Act.
1980 c37 s1Back to Top
2. In this Act
(a) "board" means the board of directors of the corporation;
(b) "corporation" means the Newfoundland and Labrador Petroleum Corporation continued by section 3;
(c) "minister" means the Minister of Mines and Energy;
(d) "petroleum" means petroleum as defined by the Petroleum and Natural Gas Act;
(e) "petroleum regulations" means The Newfoundland and Labrador Petroleum Regulations, 1977 as made under the Petroleum and Natural Gas Act; and
(f) "resident" means a natural person who
(i) is of legal age, and
(ii) has been ordinarily resident in the province for at least 3 years.
1980 c37 s2; 1987 c28 Sch B; 1989 c23 Sch BBack to Top
3. The Newfoundland and Labrador Petroleum Corporation is continued as a corporation and consists of those persons who comprise the board.
1980 c37 s4Back to Top
4. The objects of the corporation are
(a) to engage in exploration for and the development of petroleum;
(b) to engage in research and development projects relating to petroleum resources;
(c) to buy, sell, export, import, produce, transport, store, distribute, refine, exchange and market petroleum of all descriptions;
(d) to advise on matters that the Lieutenant-Governor in Council and the Petroleum Directorate may request;
(e) to hold the participation rights of the province in accordance with the petroleum regulations;
(f) to co-operate with federal and provincial petroleum companies on matters relating to the petroleum industry; and
(g) to engage or invest in ventures or enterprises related to the exploration, production, importation, distribution, refining and marketing of petroleum and related resources.
1980 c37 s5Back to Top
5. (1) The corporation may do everything necessary or conducive to carrying out its objects, both within and outside the province, and in particular may
(a) carry on other business that seems to the corporation capable of being conveniently carried on in connection with its business or calculated directly or indirectly to enhance the value of or make profitable the property or rights of the corporation;
(b) acquire and undertake the assets, business, property, privileges, contracts, rights, obligations and liabilities of another person carrying on a business that the corporation is authorized to carry on, or possessed of property suitable for the purposes of the corporation;
(c) apply for or acquire patents, patent rights, copyrights, trade marks, formulae, licences, concessions and the like, conferring a right to use, or secret or other information as to, an invention that seems capable of being used for the purposes of the corporation, or the acquisition of which seems calculated directly or indirectly to benefit the corporation, and use, exercise, develop or grant licences in respect of, or otherwise turn to account, the property, rights or information acquired;
(d) acquire a right, title or interest as set out in the petroleum regulations;
(e) participate in provincial leases in the form of direct participation or carried interest in accordance with the petroleum regulations;
(f) enter into partnership or into an arrangement for sharing of profits, union of interests, co-operation, joint venture, reciprocal concession or otherwise, with another person carrying on or engaged in or about to carry on or engage in a business or transaction that the corporation is authorized to carry on or engage in, or a business or transaction capable of being conducted so as to directly or indirectly benefit the corporation; and lend money to, guarantee the contracts of, or otherwise help that person;
(g) acquire and hold shares, debentures or other securities of another corporation having objects altogether or in part similar to those of the corporation, or carrying on a business capable of being conducted so as, directly or indirectly, to benefit the corporation, and sell or otherwise deal with the shares, debentures or other securities;
(h) obtain, purchase and sell an interest in petroleum permits, leases or other petroleum rights;
(i) assign for financing or other purposes part of its holdings, in the form of farm outs, overriding royalties or through other methods, to a company, financial institution or other organization;
(j) obtain royalties in kind on behalf of the province with the approval of the minister, but the corporation shall pay the province the full value of those royalties under the petroleum regulations;
(k) notwithstanding the bidding procedure set out in the petroleum regulations, acquire upon application 1 or more permits up to a total of 10 permits on the basis of the conditions set out in the petroleum regulations;
(l) enter into arrangements with a government or authority that seem conducive to the attainment of the objects of the corporation and obtain from the government or authority rights, privileges and concessions, and carry out, exercise and comply with those arrangements, rights, privileges and concessions;
(m) establish and support or help in the establishment and support of associations calculated to benefit employees or former employees of the corporation, or the dependants or connections of those persons, and make payments towards insurance in respect of those persons;
(n) subscribe or guarantee money for charitable or benevolent objects, or for an exhibition or for a public, general or useful object;
(o) promote a corporation for the purpose of acquiring or taking over a part of the property and liabilities of the corporation, or for another purpose that seems directly or indirectly calculated to benefit the corporation;
(p) acquire, hold, sell, lease, exchange or otherwise deal with real and personal property and rights or privileges that the corporation thinks necessary or convenient for the purposes of its business;
(q) construct, improve, maintain, work, manage, carry out or control works and conveniences that seem calculated directly or indirectly to advance the interests of the corporation, and contribute to, subsidize or otherwise help or take part in the construction, improvement, maintenance, working, management, carrying out or control of those works and conveniences;
(r) lend money to persons having dealings with the corporation or with whom the corporation proposes to have dealings or to another corporation whose shares are held by the corporation;
(s) draw, make, accept, endorse, discount, execute and issue promissory notes, bills of exchange, bills of lading, warrants and other negotiable or transferable instruments;
(t) sell or dispose of a part of the undertaking of the corporation for the consideration that the corporation thinks appropriate;
(u) apply for, secure, acquire by grant, legislative enactment, assignment, transfer, purchase or otherwise and exercise, carry out and enjoy a charter, licence, power, authority, franchise, concession, right or privilege that a government or authority or a corporation or other public body may be empowered to grant, and pay for, help in and contribute toward carrying the charter, licence, power, authority, franchise, concession, right or privilege into effect, and appropriate the corporation's debentures and assets to defray the necessary costs, charges and expenses;
(v) procure the registration and recognition of the corporation in a province, foreign country or place, and designate persons there according to the laws of the province, foreign country or place to represent the corporation and to accept service for and on behalf of the corporation of a process or suit;
(w) remunerate a person for services rendered, or to be rendered, in placing or helping to place or guaranteeing the placing of debentures or other securities of the corporation;
(x) raise and help in raising money for, and to help by way of bonus, promise, endorsement, guarantee or otherwise, another corporation with which the corporation may have business relations or whose shares, debentures or other securities are held by the corporation and to guarantee the performance or fulfilment of contracts or obligations of such a corporation or of other persons with whom the corporation may have business relations, and in particular to guarantee the payment of the principal of and interest on debentures or other securities, mortgages and liabilities of such a corporation;
(y) adopt the means of making known the products of the corporation that seem expedient;
(z) distribute to the shareholders of the corporation in kind, specie or otherwise, property or assets of the corporation including proceeds of the sale or disposition of property of the corporation and in particular shares, debentures, or other securities of or in another corporation belonging to the corporation, or of which it may have power to dispose, if the distribution, apart from this paragraph, would have been lawful if made in cash;
(aa) establish agencies, subsidiaries and branches;
(bb) invest and deal with the money of the corporation;
(cc) apply for, promote and obtain a statute, ordinance, order, regulation or other authorization or enactment that seems calculated directly or indirectly to benefit the corporation; and oppose a proceeding or application that seems calculated directly or indirectly to prejudice the interests of the corporation;
(dd) take or hold mortgages, liens and charges to secure payment of the purchase price, or for an unpaid balance of the purchase price of a part of the property of the corporation of whatever kind sold by the corporation or money due to the corporation from purchasers and others and sell or otherwise dispose of the mortgages, liens and charges;
(ee) promote education and training, research and development and economical, managerial and technical knowledge about the petroleum industry in the province;
(ff) carry out the objects of the corporation and do the things set out in this subsection as principal, agent, contractor, or otherwise, either alone or in conjunction with others; and
(gg) do those things that are incidental or conducive to the attainment of the objects and the exercise of the powers of the corporation.
(2) The rights and powers granted to the corporation by this section and the other provisions of this Act shall be in addition to the rights and powers conferred on it by section 19 of the Interpretation Act.
(3) The corporation may exercise its powers by resolution of the board except where some other mode of exercising a power is prescribed in this Act or the by-laws.
1980 c37 s6Back to Top
Board of directors
6. (1) There shall be a board of directors of the corporation consisting of the president of the corporation and not more than 10 other persons appointed by the Lieutenant-Governor in Council to the board.
(2) The directors, other than the president of the corporation, shall be appointed by the Lieutenant-Governor in Council to hold office for a term not exceeding 3 years.
(3) Where the office of a director becomes vacant during the term of the director appointed to it, the Lieutenant-Governor in Council may appoint a director for the remainder of the term.
(4) A director may, at the end of his or her term of office, be reappointed to the board.
(5) A director is entitled to receive for attendance at meetings of the board and committees those fees that may be fixed by the by-laws of the corporation.
(6) A director shall be paid by the corporation reasonable travelling and living expenses incurred by the director while absent from his or her ordinary place of residence in the course of his or her duties as a director.
1980 c37 s7Back to Top
Chairperson of board
7. (1) The Lieutenant-Governor in Council shall appoint 1 of the members of the board to be the chairperson of the board.
(2) The chairperson shall preside at meetings of the board and shall perform other duties and exercise the powers that are imposed upon or assigned to the chairperson under the by-laws of the corporation or by resolution of the board.
(3) Where at a meeting the chairperson is absent, 1 of the directors present who is chosen by the directors present shall preside and has and may exercise the powers of the chairperson.
(4) The chairperson shall be paid by the corporation the remuneration that may be fixed by the Lieutenant-Governor in Council.
1980 c37 s8Back to Top
Officers of the corporation
8. (1) The Lieutenant-Governor in Council shall appoint a president, a general manager and other officers of the corporation that are considered necessary.
(2) The officers named in subsection (1) shall be paid the salary by the corporation that is fixed by the board with the approval of the Lieutenant-Governor in Council.
(3) The officers named in subsection (1) shall perform the duties and exercise the powers that are imposed upon or assigned to those officers under the by-laws of the corporation or by resolution of the board.
1980 c37 s9Back to Top
9. (1) The head office of the corporation shall be at the place in the province that may be designated by the Lieutenant-Governor in Council.
(2) The corporation may establish other offices and agencies that it considers expedient.
1980 c37 s10Back to Top
Administration of corporation
10. The board shall administer the affairs of the corporation and make for the corporation all contracts that the corporation may by law enter into; and subject to the approval of the Lieutenant-Governor in Council, the board may make by-laws for
(a) the administration, management and control of the property and affairs of the corporation;
(b) the functions, duties and remuneration of officers, agents and employees of the corporation;
(c) the appointment or disposition of committees created for the purposes of the corporation;
(d) the affixing of the common seal of the corporation;
(e) the time and place for the holding of meetings of the board, the quorum at those meetings and the procedure at those meetings; and
(f) the conduct in other particulars of the affairs of the corporation.
1980 c37 s11Back to Top
Conflict of interest
11. A member of the board shall not vote on or speak to a matter before the board where the member
(a) has an interest in the matter distinct from an interest arising from his or her functions as a member of the board;
(b) has a monetary interest directly or indirectly in that matter; or
(c) is an officer, employee or agent of an incorporated or unincorporated company, or other association of persons, that has a monetary interest in that matter.
1980 c37 s12Back to Top
12. The corporation may employ those officers, agents and employees that are necessary for the purposes of the corporation.
1980 c37 s13Back to Top
Status of corporation
13. (1) The corporation is an agent of the Crown, and its powers under this Act may be exercised only as an agent of the Crown.
(2) The corporation may, on behalf of the Crown, enter into contracts in the name of the Crown or in the name of the corporation.
(3) Property acquired by the corporation is the property of the Crown and title to it may be vested in the name of the Crown or in the name of the corporation.
(4) Actions, suits or other legal proceedings in respect of a right or obligation acquired or incurred by the corporation on behalf of the Crown, whether in its name or in the name of the Crown, may be brought or taken for or against the corporation in a court that would have jurisdiction if the corporation were not an agent of the Crown.
(5) It is the duty of the corporation in carrying out its business to comply with the laws of the province.
1980 c37 s14Back to Top
14. (1) The authorized capital of the corporation is $100,000,000 divided into 1,000 common shares of the par value of $100,000 each.
(2) The minister shall sign for the common shares of the corporation and the amount of each subscription shall be paid out of the Consolidated Revenue Fund at the times that the corporation may require and the Minister of Finance approves.
(3) The common shares of the corporation are not transferable and shall be registered in the books of the corporation in the name of the minister and held by him or her in trust for the Crown.
(4) Where authorized by by-law, passed by the directors and approved by the Lieutenant-Governor in Council, the board may issue marketable overriding royalties either directly or in conjunction with the borrowing requirements under section 15.
(5) Where the corporation has sufficient financial income, through the payment of signed shares or otherwise, the Lieutenant-Governor in Council may order the board to issue free of charge marketable overriding royalties to residents of the province under the terms and conditions set out in the order.
1980 c37 s15Back to Top
15. (1) Where authorized by by-law, passed by the directors and approved by the Lieutenant-Governor in Council, the board may
(a) borrow money upon the credit of the corporation;
(b) limit or increase the amount to be borrowed;
(c) issue debentures or other securities of the corporation;
(d) pledge or sell the debentures or other securities for those sums and at the prices that may be considered expedient; and
(e) secure the debentures, or other securities, or other present or future borrowing or liability of the corporation, by mortgage, charge or pledge of all or a currently owned or later acquired real and personal, movable and immovable, property of the corporation, and the undertaking and rights of the corporation.
(2) Debentures or other securities of the corporation shall not be issued under a by-law under this section unless the issuing of the debenture or other security has first been approved in the manner set out in the by-law.
(3) A by-law under subsection (1) may provide for the delegation of the powers by the board to the officers or directors of the corporation to the extent and in the manner that may be set out in the by-law.
(4) Nothing in this section limits or restricts the borrowing of money by the corporation on bills of exchange or promissory notes made, drawn, accepted or endorsed by or on behalf of the corporation.
1980 c37 s16Back to Top
16. (1) The Lieutenant-Governor in Council shall fix the dividends to be paid by the corporation.
(2) A dividend shall not be declared where the corporation is insolvent or that makes the corporation insolvent or, subject to subsection (4), that will impair the capital of the corporation, and in determining the solvency of the corporation for the purposes of this subsection, no account shall be taken of an increase in the surplus or reserves of the corporation resulting merely from the writing up of the values of the assets of the corporation, unless the writing up was made more than 5 years before the date of the declaration of the dividend.
(3) For the amount of a dividend that the directors may lawfully declare payable in money, they may issue for it the shares of the corporation as fully paid up, or they may credit the amount of the dividend on the shares of the corporation already issued but not fully paid up, and the liability of the holder of the shares is reduced by the amount of the dividend.
(4) Nothing in this Act prevents the corporation when at least 75% in value of its assets are of a wasting character from declaring or paying dividends out of its funds derived from the operations of the corporation notwithstanding that the paid-up capital of the corporation may be reduced or impaired, if the payment does not reduce the value of its remaining assets so that they will be insufficient to meet the liabilities of the corporation then existing exclusive of its paid-up capital.
(5) The directors may deduct from the dividends payable to the Crown the sums of money that are due from the Crown to the corporation on account of calls or otherwise.
(6) In this section "dividend" includes bonus or a distribution to the Crown.
1980 c37 s17Back to Top
17. (1) The Lieutenant-Governor in Council may, on the recommendation of the minister and the Minister of Finance, authorize the Minister of Finance to guarantee, on behalf of the Crown, the principal and interest of debentures or other securities issued by the corporation for the purpose of raising capital otherwise than from the Crown.
(2) The Minister of Finance may approve or decide the form, manner and conditions of guarantees under this section.
1980 c37 s18Back to Top
18. (1) Upon the recommendation of the minister and the Minister of Finance, the Lieutenant-Governor in Council may, when so requested by the corporation, authorize the Minister of Finance to advance to the corporation, out of the Consolidated Revenue Fund, amounts
(a) by way of loans on those terms and conditions that the Lieutenant-Governor in Council may determine; or
(b) by way of purchases of preferred shares to which may be attached the rights, restrictions, conditions or limitations that the Lieutenant-Governor in Council may determine.
(2) The authorized capital of the corporation is increased by the amount of preferred shares issued under this section.
(3) Preferred shares issued under this section shall be redeemable at the option of the corporation but they need not bear a stated rate of dividends or be cumulative with respect to dividends.
1980 c37 s19Back to Top
19. (1) The total of
(a) the principal amount outstanding of debentures or other securities guaranteed under section 17; and
(b) the amount outstanding of loans or preferred shares under section 18
shall not exceed $200,000,000.
(2) Nothing in this section shall be interpreted as limiting the amount
(a) that the corporation may borrow without a Crown guarantee; or
(b) that a subsidiary of the corporation may borrow without a Crown guarantee.
1980 c37 s20Back to Top
20. An amount provided to the corporation for a purpose related to the undertaking of the corporation by an appropriation by the Legislature, the administration of which is assigned to the corporation, shall be made available to and accounted for by the corporation at the times and in the manner that the minister may determine, subject to a special provision made in that behalf by the Legislature at the time the amount is appropriated by the Legislature.
1980 c37 s21Back to Top
21. (1) The financial year of the corporation shall correspond to the financial year of the province.
(2) Three months before the beginning of a financial year of the corporation, the corporation shall submit to the minister, in the form that the minister may prescribe, its capital budget for that financial year including the capital budget of those subsidiaries of the corporation that the minister may prescribe and setting out the proposed capital expenditures and commitments of the corporation and the subsidiaries.
(3) The corporation may submit to the minister supplementary capital budgets in the form that the minister may prescribe.
(4) Where the capital budget or a supplementary capital budget for a financial year of the corporation is approved by the Lieutenant-Governor in Council on the recommendation of the minister, the President of the Treasury Board and the Minister of Finance, it constitutes the authority for capital expenditures and commitments by the corporation, including loans and guarantees by the corporation, set out in the budget or supplementary capital budget.
(5) The fact that the corporation did not have authority to make a capital expenditure or a commitment in respect of a capital expenditure may not be asserted against a person dealing with the corporation or with a person who has acquired rights from the corporation.
1980 c37 s22Back to Top
22. The auditor general shall audit the accounts of the corporation and has authority to call for and shall be supplied by the corporation with books and vouchers which he or she thinks necessary for the audit.
1980 c37 s23Back to Top
23. (1) The board shall, not later than April 30 in a year, prepare and submit to the minister a report containing
(a) a financial statement setting out the assets and liabilities of the corporation as at the end of the immediately preceding financial year and the results of its operations for that financial year; and
(b) a report by the board giving an account of the activities of the corporation during the financial year and setting out other matters that may appear to it to be of public interest in relation to the affairs or activities of the corporation,
and the statement and report shall be laid before the Legislature within 15 days after they are submitted to the minister, if the Legislature is then in session, or, if it is not in session, then, within 15 days after the beginning of the next session.
(2) The financial statement referred to in subsection (1) shall be signed by 2 directors and certified by the auditor general and shall have attached to it a report on it which the auditor general may have made to the corporation.
1980 c37 s24
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