Kasakhstan Fiscal RegimeHere is the comment from Jupiter Energy - a Kazakhstan Junior.... dated March 2011
"Kazakhstan fiscal regime
The Kazakhstan fiscal regime for oil has four levels of taxation:
1. Mineral Extraction Tax (5-18% based on volume) but only half the tax if the output is sold domestically
2. Economic Export Rent of 7-32% linked to the price of oil. It's calculated net of opex and transport costs. (my comment I assume opex means operating costs. This appears significant because the take-back split at least is after cost)
3. Income Tax, currently 20% but reducing to 15% by 2014 and,
4. Excess Profit Tax. A marginal tax from 10-60% when the ratio of annual income to annual deductions increases from 1.25x to 1.7x
5. In addition, oil producers have a domestic Market Obligation to sell up to 20% of output at prices 1/3rd of world oil prices.
The effective tax rate will obviously depend on a range of factors but is on the 50-70% range. While high, it is better than the Russian or Indonesian fiscal regimes which effectively take 80-80% tax."
So, it would appear that a straight 82% is the worst scenario. Oilandgas, You also indicated in one of your earlier posts that there was a sliding scale regarding the take-back - assuming production levels and brent crude price levels. Lockstock also questioned whether the most penal tax consequences would attach themselves to a junior producer.
While I take nothing as gospel , I take notice of Jupiter' s value proposition :
Value Proposition
? On a 2P/EV multiple JPR appears well priced now and is expected to provide
improved value with anticipated reserves upgrade
? Currently $US6 per barrel 2P reserves of 8.6mmbbls
This is only on 2P reserves and they value at $6.00 per barrel. And, for Doris anyway this is perhaps light sweet crude which is worth more - (see Darcy comments)
When I add it all up - TPL will explode!!!!!
I am trying to get a handle on valuation and I appreciate oilandgas's input because e is clearly researching this issue. It is interesting that Jupiter Energy value;s itself at $6.00 per barrel at P2 level?