Assessment of Myanmar Upstream Petroleum Fiscal Regimes in Comparison with Selected Competing Countries: The Investors Perspective

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dc.description학위논문 (석사)-- 서울대학교 대학원 : 협동과정 기술경영·경제·정책전공, 2016. 8. 허은녕.-
dc.description.abstractThis research mainly aims to analyze the attractiveness rank of Myanmar upstream petroleum fiscal regimes compared to other competing countries. Although several empirical studies of petroleum fiscal regimes have been carried out, studies for the combination of decision makers attitudes and quantitative analysis regarding petroleum fiscal regimes are scarce. This thesis investigates the rank of Myanmar petroleum fiscal regime attractiveness both quantitatively and qualitatively with the combination of decision makers attitude.
First, this research explores the decision makers attitudes through survey technique for three main areas: country selection for the comparison, indicator preference for the evaluation, and opinions for the effect of fiscal regimes on their investment decision. Descriptive analysis and qualitative method are used for the first part of this study. The results of selection for country and indicator are foundations for the quantitative analysis that will be made in the second part.
Second, the comparative analysis is made quantitatively to rank fiscal regimes attractiveness. In the quantitative analysis, the indicators: GT (Government Take), Front Loading Index (FLI) and CS (Composite Score) are used to measure the attractiveness rank. GT is calculated by three ways: Prompt and Intuitive Method, Non Discounted Cash Flow Model (NDCF), and Discounted Cash Flow Model (DCF). The smaller GT, the more attractive fiscal regimes. FLI is selected to reflect the impacts of different time sequence on attractiveness ranks. Consequently, in order to determine the rank of the fiscal terms attractiveness, taking into account both GT and FLI, Composite Score (CS) is used. The decision makers attitude for GT and FLI are considered in CS linear weighting method in ranking the fiscal terms attractiveness.
The results of comparative analysis show that the attractiveness rank of Myanmar petroleum fiscal regimes is relatively low, while Cambodia, Indonesia and Australia are the most attractive from the investors standpoint. In the analysis of major findings, royalty and cost recovery affect attractiveness rank of petroleum fiscal regime. On the other hand, the result of qualitative analysis also shows that most of Myanmar fiscal regimes are non-neutral, in particular, royalty regime can hinder investment decision
Summing up, this study can contribute to helping investors overseas selection phase as well as policy recommendation for more favorable investment climate in Myanmar petroleum industry
dc.description.tableofcontentsChapter 1. Introduction 1
1.1 Rationale of the Research 1
1.2 Objectives of the Research 3
1.3 The Contributions of the Research 4
1.4 Structure of the Research 5

Chapter 2. Upstream Natural Gas Industry in Myanmar 8
2.1 Natural Gas Sector in Myanmar 9
2.2 Natural Gas Reserves 10
2.2.1 Natural Gas Production and Exports 11
2.2.2 Natural Gas Primary Supply 12
2.2.3 Natural Gas Transformation 13
2.2.4 Natural Gas Consumption 14
2.2.5 Natural Gas Consumption and Export 15
2.2.6 Natural Gas Commodity Balance Statistics 16
2.3 Upstream Petroleum Exploration and Production Development in Cooperation with International Investor 16

Chapter 3. Fiscal Policy for Upstream Petroleum in Myanmar 19
3.1 Introduction 19
3.2 Major Contract Scheme for Petroleum Fiscal System 20
3.3 Fundamental Difference between Concessionary and PSC 21
3.4 Concessionary system 23
3.5 Production Sharing Contract system 24
3.5.1 Features of Production Sharing Contract 25
3.5.2 Basic Elements of Production Sharing Contract 26
3.6 Major Petroleum Fiscal Components 27
3.6.1 Royalty 27
3.6.2 Income Tax 30
3.6.3 Host Government Participation 32
3.6.4 Cost Recovery 33
3.7 Conclusion 33

Chapter 4. Theoretical Framework 35
4.1 Neutrality as a Criterion in Qualitative Analysis 35
4.2 Economic Rent Concept for Quantitative Analysis 40
4.3 Summary 42

Chapter 5. Literature Survey 44
5.1 Upstream petroleum Fiscal Regimes 44
5.2 Qualitative Method 45
5.3 Quantitative Method for Petroleum Fiscal Regimes Assessment 46
5.3.1 Host Government Take (GT) 47
5.3.2 Front Loading Index (FLI) 51
5.3.3 Composite Score (CS) 52
5.4 Summary 53

Chapter 6. Qualitative Analysis: Opinion Survey on Petroleum Fiscal Regimes 56
6.1 Introduction 56
6.2. Survey Design 57
6.2.1. Questionnaire Design 58
6.2.2. Sample selection and Source of Bias 59
6.2.3. Survey Technique 62
6.2.4. Questionnaire Response 63
6.3. Findings 63
6.3.1. Background Characteristics of Respondents 64
6.3.2. Country Selection 65
6.3.3. Attitudes of Decision Makers 72
6.3.4 Rationale for selection of indicators 74
6.4 Effect of Petroleum Fiscal Components on Investment Decision 76
6.4.1 Analysis and Discussion 76
6.4.2 Royalty 77
6.4.3 Profit Split 78
6.4.4 Income Tax 79
6.4.5 Cost Recovery 80
6.4.6 Host Government Participation 80
6.5 Summary 81

Chapter 7. Quantitative Analysis: Assessment of Upstream Petroleum Fiscal Regimes 84
7.1 Introduction 84
7.2 Method 85
7.2.1 Modelling Framework 86
7.2.2 Host Government Take (GT) 87
7.2.3 Government Take (GTi) through Discounted Cash Flow Method (DCF) 92
7.2.4 Front Loading Index (FLI) 93
7.2.5 Composite Score (CS) 95
7.3 Data 96
7.4 Results 101
7.5 Analysis of Results 103
7.5.1 Analysis of Results in GT and GTi 103
7.5.2 Analysis of Results in FLI 106
7.5.3 Analysis of Results in CS 108
7.6 Summary 108

Chapter 8. Summary, Conclusion and Recommendations 111
8.1 Summary and Conclusion 111
8.1.1 Major Findings in the Qualitative Analysis 111
8.1.2 Major Findings in the Quantitative Analysis 113
8.2 Policy Recommendations 114
8.2.1 Policy Recommendations for Myanmar Government 114
8.2.3 Recommendation for Korean Oil and Gas E&P Investors 117
8.3 Research Limitations 118
8.4 Recommendations for Further Studies 119

References 121

Appendix 127
dc.format.extent3623133 bytes-
dc.publisher서울대학교 대학원-
dc.subjectpetroleum fiscal regimes-
dc.subjectgovernment take-
dc.subjectfront loading index-
dc.subjectcomposite score-
dc.subjectnet cash flow-
dc.subjecteconomic rent-
dc.titleAssessment of Myanmar Upstream Petroleum Fiscal Regimes in Comparison with Selected Competing Countries: The Investors Perspective-
dc.contributor.affiliation공과대학 협동과정 기술경영·경제·정책전공-
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College of Engineering/Engineering Practice School (공과대학/대학원)Program in Technology, Management, Economics and Policy (협동과정-기술·경영·경제·정책전공)Theses (Master's Degree_협동과정-기술·경영·경제·정책전공)
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