dunsborough 2, page-18

Extract from Research Report:

The Angola petroleum fiscal regime is based on international Production Sharing Agreements (PSA).

The ‘state’, or Government of the Republic of Angola,
instead of collecting a royalty or specific petroleum tax,
negotiates a contract with each company on an
individual basis, making most PSAs unique

Although each PSA is unique and has confidential
components, they are structured and based on a model
template.

Angolan PSAs can have one-off signature production
and education bonuses;

Annual revenue is available to the contractor to recover up to 50% of costs. Capital development and operating costs are recovered, and those not recovered are carried forward to the subsequent year;

Iit does appear that the onshore Angolan licence has a degree of uplift for cost oil recovery. The level of recovery uplift varies but we believe this is around 40% of tangible capital costs. This simply means that for every $100 spent ROC will receive $140 over the life of production, up to the 50% annual limit.

Revenue remaining after cost recovery is split between the state and the contractor. The profit oil split is negotiable, but we understand the rates are on an
incremental sliding scale dependant on a cumulative
production basis.

Sliding scale profit oil split – oil (mmbbl)
Cumulative production (mmbbl) ...........Split – %
..............................Government/ Contractor split
Up to 25 ...........................60/40
25 50.............................. 70/30
50 100............................. 80/20
Over 100........................... 90/10


Regards

SP