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10 views1 page

AnyScanner 12 05 2024

Uploaded by

Petroleum Petroleum
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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3- the difference between Bottom-hole contribution an dawn hole contribution

Bottom-hole contribution: Contribution paid to a driller by adjoining property owners for


information from drilling in a particular property regardless of the success or failure of the drilling.

Dry-hole contribution: This concept is the same as "bottom-hole contribution" except that
payment is made only if the drilling results in a dry-hole

Question (2) ( 10 marks )

Daily production for a xxx company is 5000 barrel (no of production days 300 days per year" 75 days
every 3 months" )- if the oil price in international market is 50 $/b for first 3 months - 55$ for
next three months and 60$ for last 6 month - This company applied the production sharing agreement -
The company yearly operation cost is 4 million $- Development cost is 60 million (recovery on 5 years)
- Exploration cost is 40,million (recovery on 4 years) - assets yearly deprecation is 5,000,000 $

Royalty = 10% of Gross Production - Oil cost recovery = 30% of gross production - The State share of
the profit oil is 800/0 and Contractor share of profit Oil is 20% - The corporation taxes is 40%
Calculate the share of both the government and the contractor IF the production sharing according to
1- Indonesian type
2- 2- Egyptian model in case
A) Access cost recovery belong to stat
B) Access cost recovery added to profit oil

Answer

I) Indonesian type
Total revenue = 5000 x75x50 + 5000 x 75x55 + 5000 x150 x 60= 84375000

Royalty = 84375000 xl0% = 8437500

Oil cost recovery = 84375000 x 30% = 25312500

Amount should be recovered= 4000000 + 60000000/5 + 40000000/4 = 26000000

The amount will be recovered = 25312500

Profit oil = 84375000- ( 8437500+ 25312500 ) = 50625000

Stat profit share = 50625000 x 80% = 40500000

Contractor profit share = 50625000 x 200/0 = 10125000

Tax = ( 10125000 - 5000000) x 40 % = 2050000

Total stat shares = 8437500 + 40500000 + 2050000 = 50987500

Contractor share = 84375000 - 50987500 = 33387500

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