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Summary“Kazakhstan Upstream Fiscal And Regulatory Report - Amendments to Subsoil Law Aim to Promote Onshore Exploration”, GlobalData's latest release, presents the essential information relating to the terms which govern investment into Kazakhstan's upstream oil and gas sector. The report sets out in detail the licensing framework under which firms must operate in the industry, clearly defining factors affecting profitability and quantifying the state's take from hydrocarbon production. Considering political, economic and industry specific variables, the report also analyses future trends for Kazakhstan's upstream oil and gas investment climate.Scope- Overview of the fiscal and regulatory regime governing upstream oil and gas operations in Kazakhstan- Detail on legal framework and governing bodies administering the industry- Levels of upfront payments and taxation applicable to oil and gas production- Information on reduced tax rates applicable to high-viscosity, water-flooded, marginal and depleted fields- Detailed information on the terms of production sharing agreements- Assessment of the current fiscal regime's attractiveness to investors against regional peers- Outlook on future of fiscal and regulatory terms in KazakhstanReasons to buy- Understand the complex regulations and contractual requirements applicable to Kazakhstan's upstream oil and gas sector- Evaluate factors determining profit levels in the industry- Identify potential regulatory issues facing investors in the country's upstream sector- Utilize considered insight on future trends to inform decision-making
1 Table of Contents1 Table of Contents 11.1 List of Tables 21.2 List of Figures 22 Regime Overview 33 Fiscal Take Assessment 64 Key Fiscal Terms - Royalty/Tax Subsoil Use Contracts 84.1 Upfront Payments 84.1.1 Signature Bonus 84.1.2 Commercial Discovery Bonus 84.1.3 Historical Cost Compensation 84.2 Mineral Extraction Tax 84.2.1 General Rates 84.2.2 Rates for Low-Profit, High-Viscosity, Water-Flooded, Marginal and Depleted Fields 94.3 Export Taxes 104.3.1 Rental Tax on Exports 104.3.2 Export Duty 114.4 Direct Taxation 114.4.1 Corporate Income Tax 114.4.2 Branch Profits Tax 114.4.3 Excess Profit Tax 114.4.4 Deductions and Depreciation 134.4.5 Withholding Tax 134.5 Indirect Taxation 134.5.1 Value Added Tax 134.5.2 Property Tax 134.5.3 Land Tax 134.5.4 Import Duties 134.5.5 Environmental Levy 144.6 Liquidation Fund 145 Key Fiscal Terms - Production Sharing Agreement 155.1 Upfront Payments 155.1.1 Bonuses 155.1.2 Social Contributions 155.1.3 Training Contributions 155.1.4 Royalty/MET 155.2 Cost Recovery 165.3 Profit-Sharing 175.3.1 2005 PSA Model 175.3.2 North Caspian Sea PSA 185.3.3 Chinarevskoye PSA 195.4 Export Duty 195.5 Taxation 195.5.1 Corporate Income Tax 195.5.2 Deductions and Depreciation 205.5.3 Top Up Tax 205.5.4 Tax Exemptions 205.6 Fiscal Stability 206 Regulation and Licensing 216.1 Legal Framework 216.1.1 Governing Law 216.1.2 Contract Type 216.1.3 Title to Hydrocarbons 216.2 Institutional Framework 226.2.1 Licensing Authority 226.2.2 Regulatory Agency 226.2.3 National Oil Company 236.3 Licensing Process 236.3.1 Competitive Tenders and Auctions 236.3.2 Direct Negotiation 236.4 License Terms 236.4.1 Duration 236.4.2 Work Obligations 236.4.3 Local Content 236.4.4 Domestic Market Obligation 246.5 State Participation 246.6 Environmental Regulation 247 Outlook 258 Contact Information 261.1 List of TablesTable 1: Summary 3Table 2: Kazakhstan, MET Rates - Oil (%), 2009-2015 8Table 3: Kazakhstan, MET Rates - Domestic Gas (%), 2015 9Table 4: Kazakhstan, Oil MET Rates - High Viscosity, Water-Flooded, Marginal and Depleted Fields (%), 2015 9Table 5: Kazakhstan, Rental Tax on Export Rates (%), 2009 onwards 10Table 6: Kazakhstan, Oil Export Duty Rates (US$/tonne), 2008 onwards 11Table 7: Kazakhstan, Excess Profit Tax Rates (%), 1998 onwards 12Table 8: Kazakhstan, Excess Profits Tax Rates - Kenbay, 1996 12Table 9: Kazakhstan, Depreciation Rates by Asset Class (%), 2009 onwards 13Table 10: Kazakhstan, Environmental Levy - Gas Flaring Rates, 2015 14Table 11: Kazakhstan - North Caspian Sea PSA, Bonuses (US$ mil) 15Table 12: Kazakhstan - Chinarevskoye PSA, Royalty Rates (%) 16Table 13: Kazakhstan - 2005 PSA Model, Profit-Sharing (%) 17Table 14: Kazakhstan - North Caspian Sea PSA, Profit-Sharing (%) 18Table 15: Kazakhstan - Chinarevskoye PSA, Profit-Sharing (%) 19Table 16: Kazakhstan - North Caspian Sea PSA, Tax Rate (%) 191.2 List of FiguresFigure 1: Regime Flow Chart - Royalty/Tax Subsoil Use Contract 4Figure 2: Regime Flow Chart - Production Sharing Agreement (2005 Model) 5Figure 3: Kazakhstan, Indicative Fiscal Take Comparison - Internal, 2015 6Figure 4: Kazakhstan, Indicative NPV10/boe, IRR and Fiscal Take Comparison - Regional, 2015 7Figure 5: Kazakhstan, Legal Framework 21Figure 6: Kazakhstan, Institutional Framework 22