Are Terms Attractive Enough to Entice Investment in Upcoming Rounds?
Fiscal regimes have a major impact on field valuations, in some cases making the difference between a profitable investment and inviable project. Some countries have sought to adjust their regimes in response to the low-price environment in order to attract investment. However, average levels of global state take as a percentage of project pre-tax cash flows have not declined sharply since the 2014 price decline. As E&P companies’ exploration budgets have tightened significantly since the oil price crash, the fiscal burden applied by countries offering new licensing opportunities will be critical in determining investor interest. Countries offering improved terms, or terms that are flexible based on the oil price or investor profitability, may attract more interest as explorers avoid areas where margins are tightest.
Presented by
Erik Lambert,
Upstream Fiscal Analyst
Erik Lambert performs economic and regulatory analysis on fiscal regimes, and assess the impact of fiscal regimes on project valuations in the upstream oil and gas sector. Erik covers regimes across a range of geographies and has conducted detailed analysis of areas including Western Europe, Brazil and West Africa. Erik previously worked for Verisk Maplecroft, a political and regulatory risk consultancy, where he focused on resource nationalism risks. Erik holds an MA degree in Contemporary European Studies from the University of Bath, UK, and a BA degree in Economics and Political Science from Miami University, United States.
