EY has released its Global Oil and Gas Tax Guide 2014, which summarises oil and gas tax regimes in 80 countries.
Alexey Kondrashov, Oil & Gas Tax Leader at EY, commented: “Countries’ fiscal policy has never been so important to the oil and gas industry, by both maximizing their revenue from hydrocarbon production and creating a stable fiscal environment for efficient resource development. In addition, it allows the countries’ to attract large-scale investments”.
Commenting on the Guide, EY has indicated that governments are working on making oil and gas tax regimes competitive and attractive to investors.
According to the consulting firm, forward thinking governments review and revise their regimes as quality and economies of basins evolve over time. Other basin challenges also affect the speed at which regimes change, for example declining production within basins caused by the maturity of fields.
Some countries continue to develop tax policies specifically around unconventional and difficult-to-recover oil and gas, in an attempt to provide incentives for such projects. Governments additionally see the potential of shale within their energy mix and want to create the right conditions for industry to explore and unlock this potential.
However, EY emphasises that going forward unconventional fiscal changes might impact the available cash to establish reserves, which can negatively affect the balance sheet.
Adapted from a press release by Emma McAleavey.
Read the article online at: https://www.hydrocarbonengineering.com/gas-processing/19062014/ey_on_oil_and_gas_tax_regimes_748/