Production Sharing Contracts: What is Market Price?
Article from: OGEL 1 (2005), in Production Sharing Contracts
Introduction
PSCs, or Production Sharing Agreements (PSAs), are a familiar tool of hydrocarbon producing countries to gain overseas investment in the oil and gas sector. The basic concept is that overseas investors provide the cash to explore and develop licensed areas and, once projects are onstream, the host government takes a share of the proceeds either in cash or in kind; usually some combination of both. The host government's interests are usually represented by a national oil company (NOC), who, in some cases, have an equity interest in licensed acreage. This note provides a general ...