Work Obligations in Production-Sharing, Concession, Service and Related Oil and Gas Development Agreements
Article from: OGEL 2 (2003), in Roundup of Articles
The Auction or Cash Bid system of leasing was mostly abandoned after the Second World War and instead the quite new Discretionary System of Licensing was adopted. In the latter system the Lessor of the petroleum, now usually the government, would grant petroleum E and P rights to the International Oil Companies, IOC's, at its discretion following a complex assessment of competing bids carried out by Ministry officials. Under the Discretionary System the IOC's were usually obliged to pay a rather modest cash 'signature bonus' and also to assume a binding obligation to carry out ...