Profit sharing agreement oil and gas. html>cr

May 3, 2012 · The level of royalties can be stipulated by the laws governing the oil and gas sector or specified in the Production Sharing Agreement. 9 These formulaic arrangements and varied profit-sharing regimes across multiple jurisdictions create nuanced challenges from a transfer pricing (TP) perspective. Footnote 48. These events had a direct impact on negotiation with IOCs but favorable conditions for host countries could not be reached as they still lacked the knowledge and skills to exploit their Production-Sharing Agreements (PSAs) are among the most common types of contractual arrangements for petroleum exploration and development. LastName] having its principal place of business located at address (the “Representative”), both of whom agree to be bound by this Agreement. Under the new regime of RSC, the Government will not be concerned with the cost incurred and will receive a share of the gross revenue from the sale of oil, gas etc. The agreement begins with the introduction and background. The case describes the policies followed by the Government of India to attract private investments for Oil & Gas exploration. Dec 2, 2020 · 1. g. Agreement key terms are: - Royalty- 12. 3. Oil Gas Apr 12, 2019 · Masterclass in Production Sharing Contracts (PSC) Exploration and Production Rights and Agreements is a 3-day training course. Production Sharing, Concession, and Service Agreements are the three basic types of the contractual arrangements executed in petroleum exploration and production. In Romania, petroleum royalties start at 3. , partners, employer-employee), the date of the agreement, and a brief description of the business or venture for which the profits are being shared. org. The state, as the ownerof the hydrocarbons, hires the IOC as a contractor for the conductof exploration and production work and the IOC incurs A goverrment has signed a Production Sharing Agreement with an oil and gas company (investor). The contractor then has to pay income tax on its share of profit oil. There are two main types of petroleum fiscal systems, namely concessionary systems (or royalty-tax systems) and contractual systems, as shown on Fig. @AbrahmL. The Production Sharing Contracts (PSCs) under NELP are based on the principle of “profit sharing”. The agreement outlines the distribution of profits, often as a percentage Apr 1, 2024 · The essence of these systems is how costs are recovered and profit is shared between the government and the oil and gas companies (Johnston, 1994; Nakhle, 2010). The reason behind this is because the amount of cost recovery exceeds the total profit sharing from state oil and gas revenues. Lustgarten@propublica. Apr 20, 2015 · Production Sharing Agreements. 5% (minimum) and go up to 13. Keywords: Petroleum Resources, Contract Structure, Production Sharing Agreement, International Oil Company, National Oil A joint operating agreement, typically designated as JOA, is a contract between two or more mineral interests that collaborate on a gas or oil lease to share resources and expertise. WES is expected to increase its volumes at joint venture locations by 50%. security (1) The term “security” means any note, stock, treasury stock, security future, security-based swap, bond, debenture, evidence of indebtedness, certificate of interest or participation in any profit-sharing agreement, collateral-trust certificate, preorganization certificate or subscription, transferable share, investment contract, voting-trust certificate, certificate of deposit The joint operating agreement (“JOA”) is the most commonly used instrument in the oil and gas industry, surpassed only by the oil and gas lease. To help you understand the differences, let’s examine the 5 different categories an oil and gas agreement might fall into and the various types you’re likely to encounter. Both parties own the equipment and facilities of the project, as well as the. Profit oil or gas is the remaining of the production after deducting the share allocated to cost recovery. 25 of 1955 is considered the authoritative legal text for the Libyan oil industry. 3) The contractor (usually an IOC) would bear the pre-production risks and cost recovery would be limited to 40 percent of the annual production. With the nation’s oil industry in tatters, Maduro sees an security (10) The term “security” means any note, stock, treasury stock, security future, security-based swap, bond, debenture, certificate of interest or participation in any profit-sharing agreement or in any oil, gas, or other mineral royalty or lease, any collateral-trust certificate, preorganization certificate or subscription, transferable share, investment contract, voting-trust security (10) The term “security” means any note, stock, treasury stock, security future, security-based swap, bond, debenture, certificate of interest or participation in any profit-sharing agreement or in any oil, gas, or other mineral royalty or lease, any collateral-trust certificate, preorganization certificate or subscription, transferable share, investment contract, voting-trust In the bid to overcome these challenges, enhance the country’s oil reserve and improve the economy of the country, Production Sharing Contract (PSC) was introduced as a policy for the exploration of the country’s petroleum resources. 1. 5% (maximum). The Petroleum Law No. First contracts under Venezuela's new profit sharing program to allow private companies to explore for and produce oil and gas are Oct 6, 2021 · Production or revenue sharing in the Model Petroleum Agreement, aims to ensure that local communities benefit directly from exploitation of petroleum resources located in their counties and sub-counties. In the post-Covid-19 world, the businesses may request not sharing benefits for the communities’ development. In accordance with GR No. . Still, it permits Investing companies to manage and operate the development of the oil field, thereby negotiating a profit-sharing system. IOC may consist of one company or a group of companies (consortium) and might be local or international. Risk Agreements Mar 22, 2021 · The oil and gas entity will be entitled to a share of the oil produced which will allow for the recovery of specified costs (“Cost Oil”) plus an agreed profit margin (“Profit Oil”). 1 Overview 67 4. This strategic deployment of private effort within the multifaceted continuum of energy production, allows for governmental supervision of the complex effort of extracting energy resources, and Aug 17, 2021 · Guyana aims to increase its oil royalties and revamp other contract terms as part of a new profit-sharing agreement (PSA) for future crude and gas projects now in its draft stage, the South Aug 22, 2014 · An introduction to the SAP PSA module (Production Sharing Accounting) - Part 1. Globe Law and Business Limited, 2021 - Law - 245 pages. Company] having its principal place of business located at address (the “Company”) and [Sender. 50 - Income Tax on profit: 30% Complete the calculations in the table below and select the correct answers for a barrel of oil priced at $70. PROFIT OIL SHARING. 12 Unitisation agreements 65 4. 2) The contract would be based on production sharing instead of profit sharing. The state, as the owner of the hydrocarbons, hires the IOC as a contractor for the conduct of exploration and production work and the IOC Mar 15, 2021 · Net Profit Interest Agreements In the oil and gas industry, a farmout agreement is an agreement entered into by the owner of a mineral lease (the “farmor”) and another party that wishes to Mar 9, 2017 · created either by contract or by incorporation. It generally includes the names of the parties involved, the nature of their relationship (e. 4 Decommissioning in PSAs 72 Apr 20, 2015 · Production Sharing Agreements. Dec 1, 2022 · The project value as seen by the field operator and the regulator is subject to two main uncertain factors: the oil price and the field production rate. Under production sharing agreements the NOC, or the host In terms of the operational mechanisms for PSA, the NOC authorises the IOC to Nutaroot Pongsiri, “Partnership in Oil and Gas Production-Sharing Contracts” (2015) 17(5) International Journal of Public Sector Management 431-442 28 Tade Oyewunmi, “Natural Gas Exploration and Production in Nigeria and Mozambique: Legal and Contractual Clauses The Petroleum Arrangement (PA) Contract is the main document for governing the activities in Malaysia’s Upstream oil and gas sector. A company finances and carries out all E&P operations and receives a certain amount of oil or gas for the recovery of its costs along with a share of OGEL 1 (2005) - Production Sharing Contracts. Wood County Energy LLC and the Application by Texas Courts of the “Exculpatory Clause” in Operating Agreements Used in Oil and Gas Operations, 8 Tex. Then the NPVs are shown in probability density Feb 3, 2022 · San Antonio, Texas — February 3, 2022 — Water Energy Services (“WES”) enters into Joint Operations and Profit Sharing Agreement with Vallee Oil & Gas as it expands its reach into other wastewater markets and exploration production companies. Mar 24, 2021 · ODEL PSABalanced PSA that protects interests of both the State and investor1. royalty, cost oil, profit oil as well as income tax). Under these concessions, the operators are granted exclusive rights to exploration and production of the concession area and own all oil and gas production, subject only to the royalty. Sunday, 18th September 2016. Specifically, the agreement provides that 25 percent of the monthly revenue from oil and natural gas shares be split evenly between the companies and the government of Guyana. With a progressive contractual agreement having fair profit-sharing formula, the IOCs and host governments canforge a mutual relationship. These agreements generally fall into one of four categories (or a combination of the categories): risk agreements, concessions, production sharing agreements (PSAs, also known as production sharing contracts, PSCs) and service contracts. [1] Scott Lansdown, B. by Olfat Kamel. Under a Production Sharing Agreement, in most instances, title to the extracted petroleum remains with the host country and the contract grants rights to the IOC to recover its costs from production (cost oil) before dividing the remaining production between the host country and the IOC (profit oil). 2. These production contracts allow to formalize the its national oil company (NOC) and a petroleum company (IOC). In 1997, the government of Kazakhstan and IOCs signed the Karachaganak Field Final Production Sharing Agreement (KFFPSA), with a term of 40 years. A production sharing agreement, better known as a production sharing contract (PSC), is as a contract signed between one or more foreign private companies and a state, represented either by its government or the national oil company of that state that permits the former to provide technical and financial services The petroleum agreement establishes the mechanism for sharing the profits of oil sales with the government of Guyana. The Profit Oil share applicable to the Contracting Party shall vary based on the average Xxxxx Oil price and the average Apr 6, 2022 · The Study has clarified that the KRG’s Model PSC and most of its PSCs have adopted the R-factor formula for sharing of profit petroleum that derives from the Kurdistan Region Oil and Gas Law No (22) of 2007. The Kenyan National Government’s share of the profits are apportioned as follows: (i) 75% to the Kenyan National Government; (ii) 20% to the Jan 29, 2024 · 2- Production-sharing agreements (PSA): With this type of oil and gas contracts and agreements, the state retains ownership of the resources. 14. This section sets the stage, providing the context for the contract. The adopted R-factor is not an appropriate method and its calculation and the contractor percentage share of profit petroleum varies in The principal objects of PSA master data are the production sharing contract (PSC), and the product, which is an object that represents a hydrocarbon substance, such as oil or gas. When a contractor discovers oil or gas, he is expected to share with the Government the profit from his venture, as per the percentage given in his bid. Many of these disputes are resolved by means of international arbitration and the resulting arbitral awards often enter the public Oct 30, 2023 · A production sharing contract ( PSC) is a contractual relationship between a host government and a private sector participant (‘investor’) whereby the government contracts with the investor to carry out oil and gas exploration and production activities (E&P activities) in a defined area for a defined period of time. December 14, 2021. This paper extends the principal‐agent theory to foster understanding of partnership between the host government and its foreign contractor whether the arrangement is within the scope of IFRS 15. It is unusual, in modern times however, to have any of these petroleum agreements in its typical or conventional form. A PSA creates a contractual relationship between an IOC and thestate, authorising the IOC to explore for and exploit hydrocarbonsin a defined area and for a defined period. FirstName] [Sender. 6 In the Concession Contract, a country grants exclusive rights to private oil companies to explore, produce as well as market its oil resources. With more than 300 sections across five chapters and an additional eight schedules, Nigeria’s Petroleum Industry Act (the PIA), which was passed on August 16, 2021, repeals all previous laws related to oil and gas. In its most basic form, cost recovery refers to a mechanism through which a party to an oil and gas project can recover most, if not all, of its capital and operating costs out of a specified percentage of production called ‘cost recovery oil’ or ‘cost recovery gas’ (eg 50 per cent of total production) once (and only if) the project enters the production phase. 3 Production sharing agreements (“PSA”s) 67 4. Sep 18, 2016 · Navigating through Production Sharing, Concession, and Service Agreements. Benefit- sharing arrangements incorporated in new agreements and Indigenous Industrial Agreements are essential tools for capturing Indigenous peoples’ local economic benefits. The Government of India adopted the HELP on March 10, 2016 outlining a new contractual and fiscal model for award of hydrocarbon acreage for Exploration and Production (E&P) of hydrocarbons. INTRODUCTION. Regulation of the Minister of Energy and Mineral Resources Number 8 of 2017 on Gross Split Production Sharing Contracts ("Regulation 8/2017") sets out a new economic structure for production sharing contracts ("PSC") based on dividing gross production between the Sep 3, 2021 · The natural gas service sector, including local and international companies, should be encouraged through investment contracts [43] that are acceptable to all investors, namely, profit-sharing in Jan 7, 2014 · For the reform to succeed, it is vital that private oil companies concluding oil and gas production- or profit-sharing agreements with the Mexican Department of Energy and financing the We would like to show you a description here but the site won’t allow us. In the alternative, a separate legal. Under a typical PSA, an oil and gas entity will be responsible for all of the exploration costs, as well as some or all of the development and production costs associated with the hydrocarbon interest. Under a PSA the state as the owner of mineral resources engages a foreign oil company (FOC) as a contractor to provide technical and financial services for exploration and development operations. The template includes original suggestive content that guides you in fast and hassle-free document creation. July 24, 1995. Jan 31, 2022 · The condensate reserves of Karachaganak are estimated at 9 billion barrels, while the gas reserves are estimated at 14 trillion cubic metres (m3). ɦ The profit oil is subject to tax at the rate of 38% which is withheld at source by Sonatrach. 2 Similarly, production-sharing agreements (PSAs) entered into by Russia in the 1990s have been the subject of extreme controversy for some Jul 24, 1995 · FIRST VENEZUELAN PROFIT SHARING ACCORDS DUE SOON. Participants in this course will gain valuable insights into the operations of the Oil and Gas Industry and the use of PSC in Exploration and Production stages of the Oil and Gas Industry. Several blocks have been awarded during the last few years due to a renewed investment interest after significant Mediterranean gas discoveries, improved gas pricing, and wider energy sector reforms. Jul 20, 2023 · The oil and gas industry utilizes a variety of different contractual contracts or agreements and they can vary considerably. On January 16, 2017, Indonesia took a large step toward eradicating the cost recovery regime for upstream cooperation contracts. The remainder of the production, so called profit oil, is then shared between government and FOC at a stipulated share (e. Background and Compilation. This policy is mainly regulated by the Deep Offshore and Inland Basin Production Sharing Contract Act, Laws The rendering of services as an employee of any person engaged in any of the activities referred to in (a) or (b). Contract Area. Introduction Concession agreements and their utility in the unfaltering undertaking of various activities within the oil and gas supply chain, cannot be overemphasized. It sets out the terms, conditions, rights and responsibilities of the parties involved. J. PRODUCTION SHARIN. Aug 1, 2004 · The petroleum fiscal systems in many developing countries are now opting for production‐sharing contracts (PSC) as a new model of agreement for the exploration and production of oil and gas resources. at 40% and allocates 70% to 80% of the profit oil or gas to EGPC and 20% to 30% to the company; these numbers varies on a sliding scale based on production from a given concession. AGREEMENTS (PSAS) ARE COMMON FOR SUBSOIL HYDROCARBON EXPLORATION AND PRODUCTION Production sharing agreements (PSAs) are a type of contract which is concluded between a State or national (state-owned) oil company. According to the official website of Karachaganak INTRODUCTION TO OIL AND GAS LAW ASSIGNMENT ADMISSION NUMBER: 101153 INTRODUCTION. “EGPC’s share of profit oil typically A production sharing agreement (PSA) is a legal contract between one or more investors and any governmental entities to lay out the rights, duties, and obligations of each party for exploration, development, and production of mineral resources in a specific location for a specific time. The PIA is the basis on which Nigeria, which is both the largest oil producer and the holder of the Mar 27, 2015 · Key aspects of the reform include: allowing private investment in oil, gas and electricity exploration and production through service contracts, licenses, and profit/production sharing agreements; establishing an independent system operator for electricity; converting Pemex and CFE into autonomous state companies; and strengthening regulators. 08-22-2014 3:01 PM. This can be between a company and a representative, two businesses, or a company among its employees. Nov 1, 2021 · Oil and gas production sharing contracts (PSCs or PSAs) are high-value, high-stakes agreements which often give rise to disputes between contractors and state-owned entities such as national oil companies (NOCs). Production-sharing contracts now dominate the world of upstream exploration and development for oil and gas, with some exceptions in Europe (where concession-licenses prevail), in the US and in some Latin American countries which Aug 13, 2013 · Abrahm. Part of Right of Way for upstream oil and gas pipeline which is temporarily not utilized by the PSC Contractor. Mar 5, 2019 · In approximately 60% of oil/gas arrangements, the rights to the output are either owned completely or shared with the NOC. 7 This gives the oil companies exclusive rights over a long period of time. In a production sharing contract (“PSC”), the host country’s government awards to an oil company (or group of companies, typically called the Contractor) the rights to explore in a specified area and, following discovery of hydrocarbons in the area, the right to produce the discovered resources. By Essam Taha, Attorney at Law, Petroleum Agreements Expert. 65 percent for the government and 35 percent for the FOC). 1 . 11 This has proved to be an It was developed in the 1800s when the United States began to explore oil. Moreover, the PSC does not require the existence of agreement with the oil and gas contractors. Profit oil is calculated as the foreign company’s gross revenue less royalties, transportation costs, depreciation costs and exploitation costs borne by the company. The Production Sharing Agreement (PSA) is the most widely used host government contract in the oil and gas industry, and is becoming the leading choice for most countries in their relationship with International Oil Companies (IOCs). Under the system of production sharing agreement (PSA) and service contract (SC), IOC shall be called a Contractor, and under the concession agreement, Dec 26, 2022 · As an instrument of contract structure in the oil and gas sector, PSA needs further entrenchment between IOC and NOC to avoid likely issues that can ema-nate between the two parties in the face of current developments. Nov 1, 2018 · The government's decision to change the Production Sharing Contract (PSC) Cost Recovery into PSC Gross Split in the oil and gas cooperation contract scheme to increase the efficiency and for cost recovery. This Profit Sharing Agreement (the “Agreement”) is entered into as of date by and between [Sender. Sample Clauses. Exploration and Production Sharing Agreement The petroleum concession areas in Oman are offered to the global market by tender-based licensing rounds or via direct negotiation. This is a non-operating interest that may be created when the owner of a property Sep 21, 2023 · Venezuela and Trinidad and Tobago signed a profit-sharing agreement to export gas from the PDVSA-owned Dragon offshore project. In the oil and gas contract, the government may be represented by a public body or State-owned Enterprises (“SOEs”). The state is traditionally represented by the […] Mar 28, 2014 · The case describes the policies followed by the Government of India to attract private investments for Oil & Gas exploration. In order to explore and develop their oil and gas reserves, governments (or national oil company – NOC) enter into production-sharing contracts ( PSC) with international oil and gas companies. The emergence of National Oil Companies (NOC) in the industry has led to various hybrid forms of petroleum Jul 8, 2021 · Net Profits Interest: A percentage that is paid out of the working interest owner's share of net profits. Jul 7, 2014 · The petroleum fiscal systems in many developing countries are now opting for production-sharing contracts (PSC) as a new model of agreement for the exploration and production of oil and gas resources. Production Sharing Contracts. Dec 14, 2021 · Empowered. Profit Oil Sharing The Contracting Party and the Contracted Party shall share, on a monthly basis, the volume of Oil and Gas corresponding to the Profit Oil produced in the Contract Area. In return, the oil and gas entity is usually entitled to a share of the production, which Oct 13, 2021 · In addition, the oil and gas contractors are not required to sign the agreement. 3 Entity bears the contractual performance risk 71 4. Dec 20, 2023 · Oil and Gas - Market Overview 2023 12 October 2023 This 2023 overview of the UK's oil and gas sector begins with an examination of the country's primary energy supply and final consumption. This first OGEL issue in 2005 focuses on production-sharing contracts. I. Become a Pro and use the template now! Production sharing contract (PSC)/production sharing agreement (PSA) Under a PSC/PSA, a national oil company (NOC) or a host government enters into a contract directly with an oil and gas company. Until a profit is made, no share is given to Government, other than royalties and cesses. net's Oil and Gas Master Service Agreement Template helps you articulate the terms and conditions agreed upon between entities in the oil industry on a particular service transaction. The PSC fiscal terms today are tailored to match the opportunities offered, providing optimum sharing of the profit oil and profit gas between PETRONAS and investors. Template. Typically, the agreement is between the host country Venezuela became the first oil and gas country to introduce a “Profit Sharing Formula” that amended its CA into 50:50, later increasing to 70:30 in 1958. 2 Entity bears the exploration risk 68 4. Under a PSA, an oil company carries the most financial risks of 4. The Production Sharing Contract (PSC) continues to evolve since its introduction in 1976 to replace the concession-based system. A JOA is not the same as a merger. Inocencio. 917-512-1803. Under the profit sharing methodology, it became necessary for the Government to scrutinize cost details of private participants and this led to many delays and disputes. 5% - Cost Recovery- 35% (first 5% opex) - Profit Oil Split Ratio: 50. The PSC and product are linked through master data maintenance, and all cost, volume, and revenue data stored in PSA are assigned to a combination of a PSC and a Mar 6, 2016 · Abstract. A typical PA Contract specifies, among others: Duration & Scope of Contract. : Flavio G. Feb 28, 2013 · If one is to interpret what Finance Minister P. A PSA creates a contractual relationship between an IOC and the state, authorising the IOC to explore for and exploit hydrocarbons in a defined area and for a defined period. Under the risk and benefit sharing, the contractor participates in production risk sharing in Contracts 2–4 and additionally shares oil price risk in Contracts 3 and 4. From the remaining 75 Jun 30, 2021 · Egypt offers upstream acreage in the form of production sharing agreements (PSAs) and in some cases through service contracts. Supermajors such as BP, ENI, and Shell have strengthened their The Model Production Sharing Agreement states that a petroleum company (Contractor) gets a right explore a specified area for 3 years, with a possibility to extend exploration period; If the Contractor makes oil and gas discovery, it should inform the Somali Petroleum Authority and submit a Development Program for exploration to start. Reeder v. venture is created and managed through contractual agreements of the parties. 2. 35/2004, the PSC Contractor shall obtain approval from SKK Migas for the Facility sharing before entering into a Facility Sharing Agreement. Income from oil and gas production doesn’t always trickle down to landowners, as companies find ways to minimize Mar 10, 2022 · By Oyetola Muyiwa Atoyebi, SAN. e. Aug 17, 2012 · Assuming that oil price follows the stochastic processes of Geometric Brownian Motion (GBM) or the Mean-Reverting Process (MRP), this paper takes the net present value (NPV) as an economic index and models the PSC in 11 different scenarios by changing the value of each contract element (i. oil and gas productions (Al-Emadi, 2010). The contract governs a joint venture between those who sign the agreement while allowing each company to retain its own identity. Within the regime, the joint. Chidambaram said on petroleum sector, then the oil and gas policy regime is set to move from profit sharing to revenue sharing (or production-linked The oil and gas industry operates in countries throughout the world in accordance with a number of different types of agreements. Abstract: Since 2017, Indonesian upstream oil and gas business is managed using the Gross Split PSC scheme to replace the old scheme, namely Cost Recovery PSC. Their variability depends on production volume and is paid quarterly on each commercial field individually. The royalty has to be provided in cash or kind to the government. The Contractor initially bears the risk of Apr 19, 2023 · forth five basic principles for any future agreement with IOCs: 1) The state oil company would have management control. Dec 29, 2014 · Production Sharing Agreements (PSAs) for oil and gas exploration are seen as a characteristic of developing countries that “seek to exploit their resources for economic rents but lack the experience or technical expertise to bear the financial burden,” wrote energy law expert Marcia Ashong in her 2010 Dundee University study on cost recovery. This 20th Round JOA was consequently revised in 2008 by a group of industry lawyers working under the auspices of Oil & Gas UK to bring it into line with the standard Decommissioning Security Agreement (DSA) 9 published by Oil & Gas UK Ltd, 10 and the new Oil & Gas UK Model JOA was published in February 2009. Signal: 917-512-1803. This agreement could be either a Joint Venture (JV) or a Production Sharing Contract, which entails The CBS include Production Sharing Contracts/Agreements (PSC or PSA) and Service Agreements (SA). This Production Sharing Agreement (the “Agreement”) is made on the _______ day of ___________________, 2008 and constitutes the agreement between: The Government of the United Republic of Tanzania (hereinafter referred to as the “Government”) represented by the Minister for Energy and Minerals; The Tanzania Petroleum Development A Profit Sharing Agreement is a legal document that sets the terms and conditions for how profits will be shared between parties involved in a business relationship. ɦ Income tax applies to the foreign company’s share of “profit oil”. Production Sharing Agreements. Over time PSAs have changed substantially and today they the resources (Iledare, 2010). Jul 21, 2020 · A concession agreement granted an IOC full control, including technical and commercial control, over all aspects of the oil and gas production. The Exploration and Production Agreement (EPSA) is considered one type of various Petroleum Contracts that is recognized and implemented by many governments worldwide. "Cost Oil" has the meaning assigned in Article 35; "Crude Oil'' or "Oil" means crude mineral oil, asphalt, ozokerite, distillates, condensates and all kinds of hydrocarbons and bitumen, both in solid and liquid forms, at standard conditions of temperature and pressure (60 degrees Fahrenheit or 15 degrees Celsius argued is not an effective proxy for project profitability; hence, the resultant profit oil split under that scale inevitably results in the minimal impact of increasing crude oil prices on government take. This case is based around observations made by the Comptroller and Auditor General of India on some of the petroleum sharing contracts and the remedial measures suggested by a committee appointed by the Government. uy lw zl mw un cr ye xc dd qq