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Indonesia Upstream Fiscal and Regulatory Report - 2nd 2018 Bid Round Opened under Gross Split Terms

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    Report

  • 36 Pages
  • September 2018
  • Region: Indonesia
  • GlobalData
  • ID: 4661933
Indonesia Upstream Fiscal and Regulatory Report - 2nd 2018 Bid Round Opened under Gross Split Terms

Summary

Indonesia has introduced gross split PSAs for investment in its upstream oil and gas sector. Following the regulatory overhaul, the government is looking to promote exploration through new licensing rounds. In August 2018, the second conventional regular tender bid round opened, which for the first time includes production acreage. Going forward, Pertamina intends to increase its role as an upstream operator in the sector, this may introduce new third-party opportunities.

“Indonesia Upstream Fiscal and Regulatory Report - 2nd 2018 Bid Round Opened under Gross Split Terms”, presents the essential information relating to the terms which govern investment into Indonesia’s upstream oil and gas sector. The report sets out in detail the contractual framework under which firms must operate in the industry, clearly defining factors affecting profitability and quantifying the state’s take from hydrocarbon production. Considering political, economic and industry specific variables, the report also analyses future trends for Indonesia’s upstream oil and gas investment climate.

Scope
  • Overview of current fiscal terms governing upstream oil and gas operations in Indonesia

  • Assessment of the current fiscal regime’s state take and attractiveness to investors

  • Charts illustrating the regime structure, and legal and institutional frameworks

  • Detail on legal framework and governing bodies administering the industry

  • Levels of upfront payments and taxation applicable to oil and gas production

  • Information on application of fiscal and regulatory terms to specific licenses

  • Outlook on future of fiscal and regulatory terms in Indonesia.


Reasons to buy
  • Understand the complex regulations and contractual requirements applicable to Indonesia’s upstream oil and gas sector

  • Evaluate factors determining profit levels in the industry

  • Identify potential regulatory issues facing investors in the country’s upstream sector

  • Utilize considered insight on future trends to inform decision-making.

Table of Contents

1 Table of Contents2. Regime Overview3. State Take Assessment
4. Key Fiscal Terms
4.1. Bonuses
4.2. Gross Split Production Sharing (Contracts from 2017 Onwards)
4.2.1. Variable Adjustment Factors
4.2.2. Progressive Adjustment Factors
4.3. First Tranche Petroleum (Pre-2017 Contracts)
4.4. Investment Credit (Pre-2017 Contracts)
4.5. Cost Recovery (Pre-2017 Contracts)
4.5.1. Cost Recovery Limit
4.5.2. Recoverable Costs
4.5.3. Marginal Field Uplift (2005-2018)
4.5.4. Treatment of Unrecovered Costs upon Transition to Gross Split Regime
4.6. Production Sharing (Pre-2017 Contracts)
4.6.1. Conventional PSAs
4.6.2. Unconventional PSAs
4.6.3. TACs and KSOs
4.7. Direct Taxation
4.7.1. Corporate Income Tax
4.7.2. Deductions and Depreciation
4.7.3. Withholding Tax
4.8. Indirect Taxation
4.8.1. Value Added Tax
4.8.2. Land and Building Tax
4.8.3. Customs Duties
4.9. Domestic Market Obligation
4.9.1. Unconventional and Coal Bed Methane
4.10. State Participation
5. Regulation and Licensing
5.1. Legal Framework
5.1.1. Governing Law
5.1.2. Contract Type
5.1.3. Title to Hydrocarbons
5.2. Institutional Framework
5.2.1. Licensing Authority
5.2.2. Regulatory Agency
5.2.3. National Oil Company
5.3. Licensing Process
5.3.1. Licensing Procedure
5.3.2. 2018 Conventional Licensing Round
5.4. License Terms
5.4.1. Duration
5.4.2. Relinquishment
5.5. Local Content
5.5.1. Title to Equipment
6. Outlook
7. Appendix
7.1. References
7.2. Contact
7.3. Disclaimer
List of Tables
Table 1: Regime Overview
Table 2: Indonesia, Production Bonuses (US$ mil), Selected Contracts
Table 3: Indonesia, Base Gross Split Ratio
Table 4: Indonesia, Gross Split, Field Development Status Adjustment Factor
Table 5: Indonesia, Gross Split, Field Terrain Adjustment Factor
Table 6: Indonesia, Gross Split, Reservoir Depth Adjustment Factor
Table 7: Indonesia, Gross Split, Supporting Infrastructure Availability Adjustment Factor
Table 8: Indonesia, Gross Split, Reservoir Type Adjustment Factor
Table 9: Indonesia, Gross Split, CO2 Content Adjustment Factor
Table 10: Indonesia, Gross Split, H2S Content Adjustment Factor
Table 11: Indonesia, Gross Split, Crude Oil Gravity Adjustment Factor
Table 12: Indonesia, Gross Split, Local Content Adjustment Factor
Table 13: Indonesia, Gross Split, Production Phase Adjustment Factor
Table 14: Indonesia, Gross Split, Crude Oil Price Adjustment Factor
Table 15: Indonesia, Gross Split, Gas Price Adjustment Factor (Introduced by Regulation 52/2017)
Table 16: Indonesia, Gross Split, Cumulative Oil and Gas Production Adjustment Factor
Table 17: Indonesia, First Tranche Petroleum, 1988-2016 Contracts
Table 18: Indonesia, Third-Generation Production Sharing Contract Investment Credit
Table 19: Indonesia, Depreciation Rates and Useful Lives by Asset Type under GR 79/2010
Table 20: Indonesia, Methods of Reimbursement for Unrecovered Costs Under Older PSAs
Table 21: Indonesia, Contractor Post-Tax Profit Oil Share (%), Third-Generation PSA Incentive Packages (1988-2001)
Table 22: Indonesia, Sliding-Scale Unconventional PSA, 2015
Table 23: Indonesia, Corporate Tax Rates (%)
Table 24: Indonesia, DMO Prices
Table 25: Indonesia, Current Relinquishment
Table 26: Indonesia, Previous Relinquishment, 1981
Table 27: References
List of Figures
Figure 1: Regime Flow Chart - Gross Split PSA
Figure 2: Regime Flow Chart - Cost Recovery PSA
Figure 3: Indonesia, Indicative NPV10/boe, IRR and State Take Comparison, Regional
Figure 4: Indonesia, Legal Framework
Figure 5: Indonesia, Institutional Framework