Framework For Marginal Fields Risk Service Contracts
Performance-based agreements like the trail-blazing Berantai RSC have a keener, laser-like focus on production and recovery rates as compared with production-sharing contracts favoured by oil majors. This emphasis on optimising production capacities in marginal fields can be extended to contracts governing recovery of main oilfields in an industry of rapidly depleting resources. Currently, Petronas’ recovery factor is about 26 per cent for main oilfields, which can be further improved with optimised production techniques and knowledge exchange.
- Marginal Fields are located within a producing block and its main product is oil;
- The IOC provides technical, financial, managerial or commercial services to the state from exploration through production;
- Risk service contracts – the IOC bears all the exploration costs;
- Petronas retains ownership of oil;
- The Internal Rate of Return (IRR) is estimated at between 7 – 20% subject to terms and conditions – more attractive ROI than a PSC regime;
- Contractor receives fee payment commencing from first production and throughout the duration of the contract
- Fee is subject to taxes – but to incentivise investment in marginal fields Malaysia has reduced tax for from 38% to 25%, to improve commercial viability of investment projects;
According to think tank, Arc Media Global, while efficient, the RSC is essentially a contract that significantly increases an operator’s risks of exposure.
Read more about this topic: Production Sharing Agreement
Famous quotes containing the words framework for, framework, marginal, fields, risk, service and/or contracts:
“Seeing our common-sense conceptual framework for mental phenomena as a theory brings a simple and unifying organization to most of the major topics in the philosophy of mind.”
—Paul M. Churchland (b. 1942)
“Most young black females learn to be suspicious and critical of feminist thinking long before they have any clear understanding of its theory and politics.... Without rigorously engaging feminist thought, they insist that racial separatism works best. This attitude is dangerous. It not only erases the reality of common female experience as a basis for academic study; it also constructs a framework in which differences cannot be examined comparatively.”
—bell hooks (b. c. 1955)
“If the individual, or heretic, gets hold of some essential truth, or sees some error in the system being practised, he commits so many marginal errors himself that he is worn out before he can establish his point.”
—Ezra Pound (1885–1972)
“It matters little comparatively whether the fields fill the farmer’s barn. The true husbandman will cease from anxiety, as the squirrels manifest no concern whether the woods will bear chestnuts this year or not, and finish his labor with every day, relinquishing all claim to the produce of his fields, and sacrificing in his mind not only his first but his last fruits also.”
—Henry David Thoreau (1817–1862)
“We saw the risk we took in doing good,
But dared not spare to do the best we could
Though harm should come of it”
—Robert Frost (1874–1963)
“Whatever events in progress shall disgust men with cities, and infuse into them the passion for country life, and country pleasures, will render a service to the whole face of this continent, and will further the most poetic of all the occupations of real life, the bringing out by art the native but hidden graces of the landscape.”
—Ralph Waldo Emerson (1803–1882)
“If love closes, the self contracts and hardens: the mind having nothing else to occupy its attention and give it that change and renewal it requires, busies itself more and more with self-feeling, which takes on narrow and disgusting forms, like avarice, arrogance and fatuity.”
—Charles Horton Cooley (1864–1929)