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Merak Fiscal Model Library: Chad R/T (1999)

The document summarizes the fiscal model for Chad from 1999. Key terms of the fiscal regime include a royalty rate of 12.5% for oil and 5% for gas, a 50% income tax rate with losses carried forward for 5 years, and deductibility of training fees, surface rentals, and operating/exploration costs against tax. The fiscal calculations and reporting are done annually with no ring fencing and abandonment supported tied to economic limits. The model is part of the Merak Fiscal Model Library licensed from Schlumberger Information Solutions.

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Libya Tripoli
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61 views2 pages

Merak Fiscal Model Library: Chad R/T (1999)

The document summarizes the fiscal model for Chad from 1999. Key terms of the fiscal regime include a royalty rate of 12.5% for oil and 5% for gas, a 50% income tax rate with losses carried forward for 5 years, and deductibility of training fees, surface rentals, and operating/exploration costs against tax. The fiscal calculations and reporting are done annually with no ring fencing and abandonment supported tied to economic limits. The model is part of the Merak Fiscal Model Library licensed from Schlumberger Information Solutions.

Uploaded by

Libya Tripoli
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Merak Fiscal Model Library

A world-class collection of standardized fiscal models

Chad R/T (1999)


Fiscal Term Description
Fiscal Regime Type Royalty Tax
Chad Petroleum Code and Regulations & the Permit H Convention dated 23 March 1999, The
Governing Legislation Republic Of Chad
State Participation None defined specifically, may be negotiated in the future
Signature Bonus Negotiable, commonly includes a second bonus at time of commercial discovery
Infrastructure Development Commonly requires a one time infrastructure project
Production Bonus None
Exploration Period I (5 years)
Exploration Period II (3 years)
Surface Rental Exploration Period III (3 years)
Production Period I (25 years)
Production Period II (25 years)
Training Fee per year until first Development Concession, then typically increases for Development.
Fee per year to be paid to Ministry to cover costs associated with attending technical review
Annual Technical Review meetings
The royalty rate is 12.5% for Oil Products and 5% for Gas
Royalty
Royalty is deductible against income tax
• Tax rate of 50%
• Starting from the Calendar Year during which the first commercial production takes place,
losses can be carried forward for five years.
• Signature Bonus is not tax deductible.
• Training Fees, Annual Technical Review Fees, Surface Rentals, Operating and Exploration
Costs are expensed.
• Overhead Costs (outside Chad) shall be allowed as a deduction for income tax and will not
exceed the overhead charged to other members of the contractor group via Joint Venture
Income Tax Agreement.
• Development Costs are depreciated as follows:
Pipelines - 10 year straight line from production start date
Facilities - 20 year straight line from production start date
All other Development Capital - 5 year Straight Line from production start date
• The depreciation in respect to the first Calendar Year for which depreciation is allowable will be
made on a Half Year Rule basis.
• Depreciation will be in effect in the year the asset is placed in service or the Calendar Year
during which first commercial production takes place, which ever is later.

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Chad R/T (1999)

Fiscal Term Description


• Interest, fees and other financing charges may be imputed as Petroleum Costs for tax purposes.
(for commercial Development, Exploration and Appraisal Costs are excluded)

Ring Fencing None


Periodicity All fiscal calculations and reporting is done annually
Abandonment Support Abandonment tied to Peep’s economic limit is supported

Schlumberger Information Solutions


Merak Fiscal Model Library is licensed and supported by Schlumberger Information Solutions (SIS). SIS is an operating unit of Schlumberger that
provides consulting, software, information management and IT infrastructure services to support the core operational processes of the oil and gas
industry. SIS enables oil and gas companies to drive their business performance and realize the potential of the digital oilfield. SIS is on the Internet at
www.sis.slb.com 04-IS-171

April 2005 Page 2 of 2

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