São Tomé and Príncipe upstream fiscal summary Report

Country Report 25 May 2023

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Report summary

Upstream licences are awarded under production sharing contract (PSC) terms which are governed by the Petroleum Taxation Law 2009 and Exclusive Economic Zone (EEZ) model contract. Licences are granted through bidding rounds or direct negotiations with companies (single licensing round was held in 2010). Royalty rates (2%) and cost recovery ceilings (80%) are fixed. Profit sharing is based on the contractor's pre-tax rate of return. Corporate income tax is levied at a 30%. Signature bonuses and fees are payable and are the only biddable or negotiable fiscal terms.

Basis
Licence terms
Government equity participation
Fiscal terms
- Bonuses, rentals and fees
- Royalty
- Ring fencing
- Base
- Rate
- Payment Schedule
- PSC production sharing
- Ring fencing
- PSC cost recovery
- Base
- Rate (cost recovery ceiling)
- Recoverable costs
- Unrecovered costs
- PSC profit sharing
- Base
- Rate
- Corporate income tax
- Ring fencing
- Base
- Rate
- Payment schedule
- Fiscal treatment of decommissioning
- Product pricing
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