Aupec - Petroleum Economics - Fiscal

Core Disciplines

Our core disciplines include:

  • Policy - International energy policy and taxation
  • Fiscal - Financial modelling and investment appraisal
  • Economic - Economic forecasting, modelling and risk assessment
  • Legal - Production Sharing Contract negotiation
  • Training - Training & knowledge transfer programs

Fiscal

Oil and Gas companies operating around the world pay taxes designed by government authorities to capture the ‘economic rents’ or super profits that the industry is capable of generating.

In some countries the oil produced is divided between the state and the oil company on the basis of sophisticated sharing arrangements. The variety and complexity of taxes that are levied, or production sharing contracts that are negotiated, make the oil and gas industry unique from other industries.

Aupec is a specialist in designing both oil tax regimes and production sharing contracts. We have helped Governments design tax systems, and advised state oil companies in their negotiation of production sharing contracts with commercial oil companies.

To support our advice we have constructed a suite of computer based models of existing tax regimes and production sharing contracts from countries around the world. We use these to measure the tax revenues generated for governments from oil and gas exploitation, and to assess the impact of the tax on the profitability of the oil and gas fields modelled.

Aupec has also designed software that enables governments to forecast future tax revenues from their entire oil industry many years ahead. For countries that rely almost exclusively on oil revenues to develop their economies this capability has proved invaluable.