Observatorio de I+D+i UPM

Memorias de investigación
Thesis:
Estudio y diseño de un régimen fiscal que optimice la inversión en exploración y producción de hidrocarburos. Study and design of a tax system that optimizes investment in exploration and production of hydrocarbons.
Year:2015
Research Areas
  • Economic policy,
  • Finance,
  • Tax,
  • Fiscal policy,
  • Public economy
Information
Abstract
Fiscal systems used in petroleum arrangements between the owners of the resource (usually a sovereign country represented by its government) and the international operating company (IOC) that provides capital, knowhow and technology, have failed to allocate profits from the recent escalation of oil prices and have resulted in producing countries not receiving the right share of that increase. This has caused a wave of renegotiations and even in some cases, like Venezuela and Argentina, government unilaterally imposed new terms. This paper aims to outline desirable features of a petroleum fiscal system, under current market conditions, for governments to maximize their revenues while encouraging investment. Firstly the impact of seven different types of fiscal regimes is studied with a simulation for two separate oil fields using the scenario approach. The scenario approach has been frequently employed by academic and business researchers to compare the performance of diverse fiscal regimes. In order to decide which of the fiscal regimes? performance is best we used a multi-objective optimization decision making approach to assess the results. The criteria applied gather the preferences of a panel of industry experts about the desirable features of a contract when making investment decisions. The results show the characteristics of an ideal fiscal framework that closely resembles a production sharing contract, with no royalty payment and a high cost recovery limit that allows the IOC to recover all operating expenses and a share of its capital costs under any price scenario, a profit oil sharing mechanism based on a profitability indicator such as the ROR, with an uplift that allows to recover an additional percentage of capital costs and provisions that promote exploration investment, specially high-risk exploration, such as accelerated depreciation for capital costs and a wide definition of the ringfence clause. A contract with these features will allow governments to optimize overall revenues from its petroleum resources maximizing production by promoting investment on exploration and extending oil fields life. Also by reducing the investor?s perception of risk it will reduce the minimum return to capital required by the IOC and therefore it will increase the government share of those revenues.
International
No
Type
Doctoral
Mark Rating
Sobresaliente
Date
17/07/2015
Participants
  • Autor: Silvia Patricia Centeno Rodriguez (UPM)
  • Director: Juan Jose Sanchez Inarejos (UPM)
  • Director: Jose Luis Casado Sanchez (UPM)
Research Group, Departaments and Institutes related
  • Creador: Grupo de Investigación: Ingeniería de la Calidad Alimentaria
  • Departamento: Energía y Combustibles
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