Scribd
Upload
150 views2 pages

Merak Fiscal Model Library: Brunei PSC (2001)

This document summarizes key terms of Brunei's 2001 Production Sharing Contract (PSC) fiscal model: - The PSC model grants contractors rights to recover costs and share in profits. State oil company BNPC may participate up to 50% and repay its share of past costs from revenue. - Royalties are 8% for oil and gas. Cost recovery limits are assumed at 80%. Unrecovered costs carry forward until fully recovered. - Contractor profit oil shares are determined by production rates and cumulative volumes. Profit gas shares are set at 60% or 40% depending on cumulative gas volumes. - A windfall profit sharing mechanism applies if oil/gas prices exceed escalating base

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
150 views2 pages

Merak Fiscal Model Library: Brunei PSC (2001)

This document summarizes key terms of Brunei's 2001 Production Sharing Contract (PSC) fiscal model: - The PSC model grants contractors rights to recover costs and share in profits. State oil company BNPC may participate up to 50% and repay its share of past costs from revenue. - Royalties are 8% for oil and gas. Cost recovery limits are assumed at 80%. Unrecovered costs carry forward until fully recovered. - Contractor profit oil shares are determined by production rates and cumulative volumes. Profit gas shares are set at 60% or 40% depending on cumulative gas volumes. - A windfall profit sharing mechanism applies if oil/gas prices exceed escalating base

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
You are on page 1/ 2

Merak Fiscal Model Library

A world-class collection of standardized fiscal models

Brunei PSC (2001)


Fiscal Term Description
Fiscal Regime Type Production Sharing Contract.
• Petroleum and Mining Law and Income Tax (Petroleum) Law as amended.
Governing Legislation
• Model PSC 2001.
• BNPC has option to participate up to 50% at any time before production start.
State Participation
• BNPC will repay its portion of past costs from its share of revenue.
Royalty Royalty is 8% for Oil and Gas (Royalty Rate for gas may be different from Oil).
• Cost Recovery is calculated on a quarterly basis.
• Cost Recovery Limits exist (assumed 80%) for Oil and Gas.
Cost Recovery Petroleum
• All costs are Expensed (Sequence: Operating, Exploration, Development)
• The unrecovered costs shall be carried forward until fully recovered.
• Contractor’s Share for Profit Oil is determined by the incremental sliding scale of the quarterly
averaged production rate and the cum. production of the field.
Contractor’s Profit Oil Cum. Production Cum. Production
(%) < 200 MMBBL > 200 MMBBL
Production Rate > 25,000 BPD* 60* 40*
Production Rate 25,000 – 50,000 BPD* 40* 40*
Profit Oil Production Rate > 50,000 BPD* 20* 20*
• Contractor’s Share for Profit Gas is determined by the cum. production of the field.
Cum. Production Contractor’s Profit Gas
(TCF) (%)
> 1.5* 60*
< 1.5* 40*
(* Numbers Assumed)
• Windfall Profit Sharing (WPS) is levied when oil/gas price is higher than base price.
Base Oil Price is $20/BBL + 4% escalation every year.
Windfall Profit Sharing Base Gas Price is $1.4/Mcf + 4% escalation every year.
• The WPS is = 50% of Contractor’s Profit Revenue that excess the Contractor ‘s Profit revenue
when calculated with the base prices.

April 2005 Page 1 of 2


Brunei PSC (2001)

Fiscal Term Description


• Income tax rate is 55% for petroleum industry.
• Exploration Costs are expensed.
• Depreciation Schedule for Development Costs are as followed,
Capital Initial Annual
Type Allowance Allowance
Plants &Gathering/ Onshore 5-year SL
Income Tax
Pipelines/Facilities Offshore 4-year SL (Def.)
Platforms 40% 25%
Tangible Drilling Onshore 5-year SL
Cost Offshore 40% 25% (Def.)
Intangible Drilling Cost 20% 5%
• Losses can be carried forward for 6 years
Withholding Taxes Withholding Tax Rate is 20%
• Ring fence is assumed on Cost Recovery, Profit Sharing and WPS Calculation.
Ring Fence
• No Ring Fence for Income Tax.
Periodicity Quarterly (except Income Tax).

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

Merak Software Family

You might also like