Evaluation and analysis of fiscal regime in Production Sharing Contracts (PSC)

Looking at the variety of contractual systems in the oil industry shows that countries across the world use different exploration and development contracts in their oil fields. However, oil and gas industry is covered with three contractual systems (concession, Product Sharing Contracts (PSC) and service contracts) and exploration and exploitation activities of projects are assigned by this system. But if we review the contract items and elements, we can understand a wide variety of contractual systems. Based on this analysis and evidence projects with same conditions may have different fiscal regimes. Therefore, with this interpretation, financial, technical and legal issues are significant factors in contractual system. Based on contract's name we could not judge impartially.
In this article fiscal regime in product sharing agreements are explained and analyzed. Then it is shown how threshold and trigger effect the government and investors take. Finally, fiscal regime factors and this effects in oil and gas project return will be explained.