Under this law, all crude petroleum in Libya is the property of the Libyan State. Hence, no person may explore or exploit petroleum in Libya unless authorised by a permit or a concession issued in accordance with the law.
The petroleum law authorises land allocations and permits to prospectors for the drilling of oil wells. It does not cover natural gas. The law also establishes the Petroleum Commission, which makes decisions on whether to grant concessions to private companies. Furthermore, it provides broad authority for the Petroleum Commission to decide on matters concerning granting, assigning, renewing, relinquishing, or cancelling licenses and concessions.
This regulation defines applicable taxes, fees, rents, royalty rates and penalties due to non-compliance. Moreover, it has provisions regarding transport facilities (including pipelines) and oil refining.
In its second annex, which is a standard Petroleum Concession Contract, the regulation establishes the right of special government employees to inspect installations and determines the need to properly measure and record all extracted petroleum and natural gasoline.