No abstract

No abstract

Production sharing contract (PSC) is one of the most commonly used contract type in international petroleum cooperation practices, under which, contractors obtain net reserves composed of in kind “cost oil” and “profit oil” by taking risks, bearing exploration, development and production costs, paying royalties, income taxes and other fees to the government of the resource country (the host government). The net reserves owned by a contractor refer to the remaining economic recoverable reserves that the contractor can obtain during the remaining contract period, which represent the real revenue the contractor can realize. Taking Project XX in Africa for example, this paper analyzed the methods for estimating net oil and gas reserves under PSCs, discussed the impacts of production, decline rate, plan, prices, costs, profit oil sharing and taxes on net reserves from four aspects including technique, economics, commerciality and engineering. In addition, the paper also made sensitivity analysis of the factors having significant influence on net reserves, such as the oil production, oil prices, operation expenses and investment, and put forward some recommendations for optimizing field development strategies to maximize contractors’ economic benefits.

No abstract

No abstract