Country Report
Azerbaijan upstream fiscal summary
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*Please note that this report only includes an Excel data file if this is indicated in "What's included" below
Report summary
JV agreements in Azerbaijan became obsolete in 1998 and all current awards are under PSC terms. The BP-operated Azeri Chirag Guneshli (ACG) oil field and Shah Deniz gas-condensate field are the main PSC developments and provide the majority of production and investment. PSC terms include bonuses, fixed cost recovery, and negotiable profit oil splits based on a sliding scale ‘R-factor' system. The State oil company, SOCAR, participates directly in all contracts, typically taking a stake between 10% and 50%, and is usually carried through the exploration phase. In 2017-18, Azerbaijan awarded its first Risk Service Agreements (RSAs) for the offshore Umid-Babek and Karabakh projects. RSAs are largely similar to a typical PSC and contain cost recovery and profit sharing mechanisms.
Table of contents
- Basis
- Licence terms
- Governmentequity participation
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Fiscal terms
- Bonuses, rentals and fees
- Indirect taxes
- Royalty
- PSC production sharing
- Ring fencing
- PSC cost recovery
- Base
- Rate (cost recovery ceiling)
- 13 more item(s)...
- Recent history of fiscal changes
- Stability provisions
- Split of the barrel and share of profit
- Effective royalty rate and maximum government share
- Progressivity
- Fiscal deterrence
Tables and charts
This report includes the following images and tables:
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TimelineTimeline detailSplit of the barrel - oil
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Split of the barrel - gasShare of profit - oilShare of profit - gasEffective royalty rate - onshore , oil and gasEffective royalty rate - shelf/deepwater , oil and gasMaximum government share – onshore, oil and gasMaximum government share – shelf/deepwater, oil and gasState share versus pre-share IRR - oilState share versus pre-share IRR - gas
- 9 more item(s)...
What's included
This report contains:
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