Production Sharing Arrangement: How Effective are the Fiscal Terms Designed for Deepwater Exploration in Nigeria and Indonesia?
Article from: OGEL 3 (2004), in Production Sharing Contracts
The nature of deepwater exploration is characterised by high risks, substantial investments and lead times. In order to stimulate exploration in these areas and attract risk capital from foreign oil companies, there is need to design an efficient fiscal regime with competitive terms. This article examines and compares the different fiscal terms for deepwater acreage in Nigeria and Indonesia to determine their attractiveness for foreign investment. It also highlights the similarities in their contractual structure and shows how the fiscal terms of one system can make it regressive ...