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(1) Ownership of physical assets purchased, installed or constructed by a contractor for petroleum activities shall be transferred to the Corporation at the option of the Corporation either when the full cost has been recovered in accordance with the terms of the petroleum agreement or when the petroleum agreement terminates.

(2) The contractor is entitled to further use of the assets for purposes of operations under the petroleum agreement and remains liable for maintenance, insurance and other costs associated with the use of the assets.

(3) The contractor is in any of the events specified under subsection (1) responsible for the decommissioning of the assets.

(4) A physical asset that is used by a contractor in a petroleum activity as a capital or financial lease shall be treated as a purchased asset.

(5) Where at least fifty percent of the cost of a physical asset has

been recovered in accordance with the terms of an existing petroleum agreement, the Corporation may have the title to the asset transferred to the Corporation by the contractor on the payment by the Corporation of the unrecovered portion of the cost of the asset.

(6) A contractor is not required under this section to transfer to the Corporation, equipment or any other assets rented or leased by the contractor for use in petroleum activities and which are of the type customarily leased for use in accordance with petroleum industry practice.

(7) A lien, charge or an encumbrance on an asset shall lapse upon the transfer of that asset under this section, however, the rights of use established with the prior approval of the Minister shall remain in force.