Merak Fiscal Model Library

A world-class collection of standardized fiscal models

Bangladesh PSC (1993)

Fiscal Term Description
Fiscal Regime Type Production Sharing Contract.
Governing Legislation The Bangladesh Petroleum Act of 1974
State Participation None.
Signature Bonus None.
• Negotiable Training allowance: Minimum $100,000 per year. Not cost recoverable.
Rental and Fees
• Negotiable Service Fee, cost recoverable.
• Production Bonus Is negotiable, the following table shows sample rates;

Production Rate Production Rate Bonus

Oil (Mbopd) Gas (MMcfd) (MM$)
10 75 1
Production Bonus 20 150 2
50 300 3
100 600 4

• Not cost recoverable.

• Lesser bonus for offshore developments
Discovery Bonus Negotiable
Royalty None

R&D Tax Research and Development Tax of $.03 per bbl. Not cost recoverable.

• 45% of Oil Revenue after deducting Royalty is used for Cost Recovery
• 60% of Gas Revenue after deducting Royalty is used for Cost Recovery
Cost Recovery
• Operating and Drilling costs are expensed.
• All non-Drilling capital costs are depreciated 25% Straight Line.

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 Bangladesh PSC (1993)

Fiscal Term Description

• Revenue remaining after Royalty and Cost Recovery is split between the Government and
Contractor according to the following table;

Profit Oil Profit Gas Profit NGL

Contractor’s Contractor’s Contractor’s
Oil Gas NGL
Profit Oil Profit Gas Profit NGL
Production Production Production
Share Share Share
Profit Sharing (Mbopd) (MMcfd) (Mbopd)
(%) (%) (%)
< 10 35.0 < 150 37.5 < 1.5 35.0
10 – 25 32.5 150 – 250 35.0 1.5 – 2.5 32.5
25 – 50 30.0 250 – 350 25.0 2,5 – 3.5 30.0
50 – 100 25.0 350 – 450 15.0 3.5 – 5 27.5
> 100 20.0 > 450 12.5 >5 25.0
• Better Splits for Offshore developments.
• Income tax included in production share (i.e. Tax Rate = 0%).
Income Tax • If a Tax Rate is entered, the model will estimate value of Tax in Barrels for reserves (for US
companies)
Withholding Tax None.

Schlumberger Information Solutions

Merak Fiscal Model Library is licensed and supported by Schlumberger Information Solutions (SIS). SIS is an operating unit of Schlumberger that
provides consulting, software, information management and IT infrastructure services to support the core operational processes of the oil and gas
industry. SIS enables oil and gas companies to drive their business performance and realize the potential of the digital oilfield. SIS is on the Internet at
www.sis.slb.com 04-IS-171

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