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India upstream fiscal summary

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29 June 2018

India upstream fiscal summary

Report summary

From March 2016, all new upstream licences are awarded through the licensing rounds under new Hydrocarbon Exploration and Licensing Policy (HELP), which introduced Revenue Sharing Model (RSM) terms. Within the RSM regime there is no cost recovery.  Revenue after royalty is shared between the government and contractor. The latter must recover costs and make a profit from its allocation. Revenue sharing is based on high and low revenue points which are set by the government, with the respective revenue shares biddable by the contractor. To support investment, the contractor revenue share is fixed at low revenue point for a number of years from the commercial production start, depending on the location. Royalty is fixed but varies between 5% and 12.5% depending on a fields  location. Corporate income tax is payable at the effective rate of 34.61% for domestic companies and at 43.26% for foreign companies.

Table of contents

  • Executive summary
    • Basis
    • Licence terms
    • Government equity participation
    • Fiscal terms
      • Ring fencing
      • Bonuses, rentals and fees
      • Indirect taxes
      • Royalty
      • RSM cost recovery
      • RSM profit sharing
      • Corporate income tax
      • Fiscal treatment of decommissioning
      • Product pricing
      • Summary of modelled terms
    • 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 26 images and tables including:

  • Revenue flow chart: India RSM
  • Timeline
  • Timeline details
  • Split of the barrel - oil
  • Split of the barrel - gas
  • Share of profit - oil
  • Share of profit - gas
  • Effective royalty rate and minimum state share - onshore, oil
  • Effective royalty rate and minimum state share - onshore, gas
  • Effective royalty rate and minimum state share- shelf, oil and gas
  • Effective royalty rate and minimum state share - deepwater, oil and gas
  • Maximum government share and maximum state share - onshore, oil
  • Maximum government share and maximum state share - onshore, gas
  • Maximum government share and maximum state share - shelf, oil and gas
  • Maximum government share and maximum state share - deepwater, oil and gas
  • State share versus Pre-Share IRR - oil
  • State share versus Pre-Share IRR - gas
  • Investor IRR versus Pre-Share IRR - oil
  • Investor IRR versus Pre-Share IRR - gas
  • Bonuses, rentals and fees
  • Indirect taxes
  • Royalty rates by type and location
  • Contractor revenue share
  • Contractor revenue share
  • Effective corporate income tax rates
  • Assumed terms by location - oil and gas

What's included

This report contains:

  • Document

    India upstream fiscal summary

    PDF 288.50 KB