House of Reps Public Hearing Day 2 – OPTS

Public Hearing commenced at 10:28 with presentations from OPTS and its members

OPTS Chairman

  • PIFB
    • JV oil will grow
    • Sanctity of contract generally observed
    • Deep offshore royalties significantly increased
    • Exclusion from production allowances does not incentivize the production of oil or gas in deep water
    • The sales of gas to the domestic market
    • Multiple levels of ring-fencing may inhibit simplicity of implementation and may be a source of dispute
    • Excessive powers of the Commission – the setting of rents, metering points


    • Excessive financial burden on OPTS members in view of all the taxes and levies imposed on the industry
    • Does not take into account the CSR obligations to communities outside
    • Recommendation that the contribution should be deducted from current contributions to NDDC
    • The bill as proposed imposes significant administrative burden
    • No clear definition of Host and Impacted Communities – Bill should set clear guidelines
    • Disputes to be resolved by the Commission – state governments should be accorded a role in disputes resolution


MD Exxon Mobil

  • PIFB
    • JV gas projects will be negatively impacted
    • Small and medium-sized deepwater developments will remain stranded

MD Chevron

  • PIFB
    • Lack of incentives for deepwater fields – only 4% in the current portfolio as opposed to 49% under the existing fiscal terms
    • Small and medium-sized deepwater fields will be stranded – specific terms based on field size should be proposed
    • Definition of Host and Impacted Communities ambiguous


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