Effects of Fiscal Regime Changes on Investment Climate of Malaysia's Marginal Oil Fields: Proposed Model

Manaf, Nor Aziah Abdul; Saad, Natrah; Ishak, Zuaini; Mas’ud, Abdulsalam

doi:10.1016/j.sbspro.2014.11.050

Cited by 9 publications

(8 citation statements)

References 5 publications

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“…In order to achieve the recovery of 15 to 16.5 billion boe, real time well tests based on MPFMs would likely be the best option, as real time field data provides vital information to facilitate exploration success and to optimise oil and gas production, petroleum revenue tax ( Figure 8) and financial performance in terms of net present value, internal rate of return, profitability index, saving index and so on [19]. In its 2014 budget, the UK government announced a review of the fiscal regime to ensure that it supports MER UK [21].…”

Section: Discussionmentioning

confidence: 99%

Maximising Economic Recovery - A Review of Well Test Procedures in the North Sea

Marshall¹,

Thomas²

2015

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One of the primary recommendations of the Wood Review is for Government and Industry to develop and commit to a new strategy for Maximising Economic Recovery from the United Kingdom Continental Shelf (UKCS). To achieve this recommendation several strategies are proposed. These cover the key UKCS areas which require enhanced development to ensure that the UK maximises the production of its assets.As part of the Technology Strategy, there is push to apply better reservoir management techniques on a cost effective basis. In order to manage a reservoir appropriately, the produced fluids have to be measured accurately. Typically in the UK, this is accomplished through the use of Well Tests and associated equipment -namely test separators supported by single-phase flow measurement technologies.Well test data is critical to operations in the offshore industry and covers a wide variety of applications. The data can be used to allocate produced fluids to particular wells either directly, or through verification of multiphase flowmeters. The data can also be used in the determination of reservoir size and in the positioning of new wells and installations. Another key use of well test data is in the optimisation of well production where well stream parameters can be altered to maximise hydrocarbon production levels.However, recent first-hand audit experience by DECC suggests that well test measurement systems may not be operating at their optimal levels. For instance, primary measurement elements (flowmeters) are often not removed and recalibrated on a routine basis. There is also evidence of flowmeters being exposed to two phase flows resulting in meter degradation. In addition, the interval between the testing of individual wells may extend to several weeks, with the flow rates between tests inferred by interpolation. The risk is therefore that these measurements may result in a measurement bias. This paper will present work completed on behalf of DECC into the current state of the art for well testing in the UKCS. North Sea operators have been questioned and their responses used to calculate typical uncertainties achieved during well testing. The significance of the uncertainty in measurement is highlighted through case studies into the impact on the applications that use well test data. Finally, alternative methods to current well testing practice are discussed with their expected impact on the UK offshore oil & gas industry.The submitted paper provides evidence and recommendations in line with the ethos of the Wood Review, as well as assisting industry to achieve the goals and step-wise improvement in performance, which the Review demands.

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Section: Discussionmentioning

confidence: 99%

Maximising Economic Recovery - A Review of Well Test Procedures in the North Sea

Marshall¹,

Thomas²

2015

All Days

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“…The concessionary system requires auditing and transparency, and it may be difficult to implement in developing countries. It could be fraught with gold-plating, over-invoicing, transfer pricing and low saving index (Kaiser, 2007;Abd Manaf et al, 2014).…”

Section: Fiscal Regime Elementsmentioning

confidence: 99%

Impact of Production Sharing Contract Price Sliding Royalty: The Case of Nigeria’s Deepwater Operation

Okoro

Okoye²,

Okafor³

et al. 2021

IJEEP

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Petroleum fiscal regime has been a controversial issue in Nigerian economy. The basic issue is which regime will lead to the greatest benefit to the government without negatively affecting the performance of the international oil companies. Nigeria has in the past used different regime and had adopted the current price sliding royalty regime in 1996. The aim of this study is to examine how the new price sliding royalty affects the stake of government and contractors. This study adopts ex-post research design approach using data from various sources between 1980 and 2019. The autoregressive distributed lag (ARDL) regression approach was adopted for the data analysis. The unit root results reveal that the time series data consists of a mix of I(1) and I(0) variables. The ARDL bound cointegration test shows that all the variables specified in the models have long run relationship. Estimates from the models indicate that the royalty regime in the Deep Offshore and Inland Basin Production Sharing Contract has positive and significant impact on the stake of government in the long and short runs, but negative impact on the stake of contractors. Furthermore, the royalty regime has negative impact on contractors' performance in the long run. However, the impact on the three fiscal indicators (oil revenue, government expenditure, and deficit-GDP ratio) is positive. The study therefore recommends the repeal of the Nigerian petroleum fiscal policy with the new price sliding royalty to encourage investment and development of the petroleum sector.

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“…It is defined as the "proportion of the host nation's income from investment project to the total project revenue within the valid period of the contract" (Luo and Yan, 2010:758). It measures how much the host government takes via upstream petroleum fiscal terms (Sen, 2014;Manaf et al, 2014). In designing a petroleum tax system, host governments most often attempt to maximize their share of the oil wealth (Agalliu, 2011).…”

Section: Hypothesis Developmentmentioning

confidence: 99%

Balancing the Interests of Parties in Contractual Relationship: How Fair Is the Nigerian Petroleum Tax System to the State and the Oil Majors?

Kyari

2020

IJEEP

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Securing a fair share of oil wealth to the host government at the same time providing adequate incentives to the oil majors are two objectives that underpin the design of a fair petroleum tax system. These objectives are competing rather than complementing and thus the need for compromise by both the government and the oil majors to achieve fair contractual relationship. This study investigates whether the Nigerian petroleum tax system has fairly captured the interests of both the government and the oil majors. Guided by the economic rent theory, the study revealed, among others, that the tax system was fair in securing the government its fair share of oil wealth. Similarly, the tax incentives to the oil majors were adequate in positively influencing their investment decisions. The study concludes that the Nigerian petroleum tax has fairly captured the interests of both the government and that of the oil majors.

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Effects of Fiscal Regime Changes on Investment Climate of Malaysia's Marginal Oil Fields: Proposed Model

Cited by 9 publications

References 5 publications

Maximising Economic Recovery - A Review of Well Test Procedures in the North Sea

Maximising Economic Recovery - A Review of Well Test Procedures in the North Sea

Impact of Production Sharing Contract Price Sliding Royalty: The Case of Nigeria’s Deepwater Operation

Balancing the Interests of Parties in Contractual Relationship: How Fair Is the Nigerian Petroleum Tax System to the State and the Oil Majors?

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