WORLD FISCAL SYSTEMS FOR OIL AND GAS - Alaska Oil and Gas

100 Pages·2012·3.29 MB·English

Policy Options for Alaska Oil and Gas
Pedro van Meurs

Monday – Tuesday, February 13-14, 2012

Presentation
Alaska Senate Finance Committee

Van Meurs Corporation
Nassau, Bahamas
Tel: [phone]
e-mail: [email protected]
Introductory Comment
The objective of Governor Parnell is to
achieve a TAPS throughput of 1 million
barrels per day.

Can this objective be achieved from State of
Alaska resources by 2025? Yes

How?

It will require major policy and fiscal changes as
will be discussed during the seminar.

These changes need to induce an increase in investment
of about $ 7.5 billion per year over current levels.
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Introductory Comment
Such major policy and fiscal changes could
also induce significant exports of LNG prior
to 2025.
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Four Sessions
The seminar will develop in four sessions:
New policy framework required
1.
International competitive environment
2.
Proposed terms for existing and new
3.
light oil
Proposed terms for heavy oil, shale oil
4.
and natural gas
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Session 1

New policy framework required
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World Rating of Oil and Gas Terms
Much of the material to be presented during the seminar
is derived from a large international study being done
by Van Meurs Corporation entitled:

World Rating of Oil and Gas Terms

In this study oil and gas fiscal systems of more than 140
countries and jurisdictions, such as Alaska, are being
compared and analyzed in order to determine their
favorability for investors.

Information about the study is available on:

www.petrocash.com

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World Rating of Oil and Gas Terms
The 2011-2012 ratings of fiscal terms will cover 6
volumes.

Four volumes have been completed:
North American wells and shale plays

Deep water

Arctic

Shallow water


Two volumes still to be completed:
Onshore fields and shale plays

Summary


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Alaska fiscal terms
During the seminar specific new fiscal terms will
be proposed for Alaska oil and gas.

The purpose of these terms is to demonstrate how
a new fiscal system can be created and to indicate
the order of magnitude of the amounts and rates
that would need to be adopted.

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Concept of Government Take
During the seminar the concept of “government
take” will be used frequently. Following is an
example of the calculation of the government
take for a 10% royalty.

Gross Revenues $ 100 per barrel
Costs $ 20 per barrel
-----------------------------------------------
Divisible Income $ 80 per barrel
Royalty 10% $ 10 per barrel

Government Take: ($ 10 / $ 80) x 100% = 12.5%

The Government Take in this seminar is presented on an undiscounted and real
basis using an escalation and inflation rate of 2% and is based on price and cost
data as contained in Volume 3 of World Rating of Oil and Gas Terms.

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Policy Change required

Alaska will not be able to reverse the decline in
oil production from State of Alaska leases unless
Alaska encourages major investment in:
Heavy oil,

Potentially Shale Oil, if technically and

economically viable, and
Maybe some GTL production

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