Production sharing contracts or Licences
• A government has to grant a private party the right to explore and produce petroleum.
• This is done either though a production sharing agreement or a licence (and sometimes confusingly both)
• In August 2010, the Lebanese Parliament ratified a law providing for production sharing contracts
• Another possibility is the service agreements (“buy-back”)
– where there is a fixed return
• The government gets, for the grant of the right, royalty and other taxes