operators of liquefied natural gas (“ LNG ”) infrastructure ; and
• electricity , relating to onshore and offshore generation , storage , aggregation , transmission and distribution of electricity across Great Britain ( but excluding Northern Ireland ).
Upstream oil and gas
The following qualifying entities meet the specified descriptions for the purposes of the upstream oil and gas sector :
• qualifying entities that own , operate , or enable the operation of an upstream petroleum facility ;
• qualifying entities that develop or enable the development of an upstream petroleum facility ( for “ new ” facilities only , being those under construction or that have commenced operations in the previous 12 months ); or
• qualifying entities that hold a licence for an upstream petroleum facility under section 2 of the Petroleum ( Production ) Act 1934 or section 3 of the Petroleum Act 1998 .
However , there is a materiality threshold determined by the throughput of the relevant upstream petroleum facility , such that an entity is only a “ qualifying entity ” if the relevant upstream petroleum facility :
• has a throughput of more than 3 million tonnes of oil equivalent in the 12 calendar months preceding the month in which the purchaser gains control ( or the first 12 calendar months of operation if it is a new facility ); and
• the upstream petroleum facility is situated in whole or in part in the United Kingdom , or is used in connection with the supply of petroleum to persons in the United Kingdom .
For the purposes of the Regulations , “ upstream petroleum facility ” means any terminal ( excluding gas processing facilities in the United Kingdom or LNG import or export facilities ), upstream petroleum pipeline ( excluding interconnectors ) or unit of infrastructure that is or will be necessary for the purposes of a petroleum production project carried out by virtue of a licence granted under section 2 of the Petroleum ( Production ) Act 1934 or section 3 of the Petroleum Production Act 1998 .
As a result , any qualifying entity that either holds a licence for the exploration , drilling and production of petroleum in the UK or is an owner , operator or enables the operation of any infrastructure related to or necessary for exploration , drilling or production that meets the throughput and nexus tests will be within the scope of the mandatory notification regime .
Based on a conversion factor of 1 tonne of oil equivalent to 6.84357 barrels of oil equivalent (“ boe ”), facilities that have an annual throughput of 20,530,710 boe or 56,250 boe / day will be captured – meaning that the larger participants in production activities in the UK North Sea and much of the associated petroleum infrastructure would satisfy this test .
Downstream oil
The following qualifying entities are relevant for the purposes of the downstream oil sector :
• qualifying entities engaged in the import or storage of any crude oil , intermediates , components or finished fuels ;
• qualifying entities engaged in the production of intermediates , components or finished fuels through refining or blending processes ;
• qualifying entities engaged in the distribution of petroleum-based fuels to storage sites by road , pipeline , rail or ship ; and
• qualifying entities engaged in the delivery of petroleum-based fuels to retail sites , airports or end users .
There is again a materiality test in order for an entity to constitute a “ qualifying entity ”, assessed by reference to the qualifying entity ’ s capacity in one of the previous three calendar years :
• if it had a capacity of greater than 500,000 tonnes ; or
• if it owned a facility with a capacity of greater than 50,000 tonnes .
Downstream oil activities and capacities are viewed in the aggregate under the Regulations , such that an entity that imported 400,000 tonnes of finished fuel in 2020 , imported a further 450,000 tonnes of fuel and produced 75,000 tonnes of finished fuel in 2021 and imported 400,000 tonnes of fuel in 2022 is deemed to have a capacity of 525,000 tonnes due to its 2021 capacity . The relevant qualifying entity would therefore satisfy the capacity tests notwithstanding that it did not meet the threshold for importing or production alone and only did so in one of the previous three calendar years .
Downstream gas
The following qualifying entities are within the scope of the Regulations in relation to the downstream gas sector :
• qualifying entities holding a gas transmission licence , distribution licence , interconnecter licence or exemption under section 7 or 7ZA of the Gas Act 1986 ;
• qualifying entities that own or operate a gas processing facility in Great Britain which has the capacity to process more than 6 million cubic metres of gas per day ; and bracewell . com