South Africa Upstream Fiscal and Regulatory Report - Pending Legislation Creates Regulatory Uncertainty

1 Table of Contents
1 Table of Contents 1
1.1. List of Tables 2
1.2. List of Figures 2
2. Regime Overview 3
3. State Take Assessment 5
4. Key Fiscal Terms 6
4.1. Royalties, Bonuses and Fees 6
4.1.1. Royalties 6
4.1.2. Exploration Fees 6
4.1.3. Upstream Training Trust Fees 7
4.2. Direct Taxation 7
4.2.1. Corporate Income Tax 7
4.2.2. Deductions and Depreciation 8
4.2.3. Withholding Tax 8
4.3. Indirect Taxation 8
4.3.1. Value Added Tax 8
4.3.2. Customs Duties 9
4.4. Participation Requirements 9
4.4.1. State Participation 9
4.4.2. Historically Disadvantaged South African Participation 9
4.5. Fiscal Stability Agreements 9
5. Regulation and Licensing 10
5.1. Legal Framework 10
5.1.1. Governing Law 10
5.1.2. Contract Type 10
5.1.3. Title to Hydrocarbons 10
5.2. Institutional Framework 11
5.2.1. Licensing Authority 11
5.2.2. Regulatory Agency 11
5.2.3. National Oil Company 12
5.3. Licensing Process 12
5.4. License Terms 13
5.4.1. Duration and Relinquishments 13
5.4.2. Work Obligation 13
5.5. Local Content 13
5.6. Regulations on Hydraulic Fracturing 14
6. Outlook 15
7. Appendix 16
7.1. References 16
7.2. Contact Us 17
7.3. Disclaimer 17

1.1 List of Tables
Table 1: Regime Overview 3
Table 2: South Africa, Onshore Exploration Fees (ZAR) 6
Table 3: South Africa, Offshore Exploration Fees (ZAR) 7
Table 4: South Africa, General and Oil & Gas Corporate Tax Rates, 1980-Present 8
Table 5: South Africa, Application Fees (ZAR) 12
Table 6: References 16

1.2 List of Figures
Figure 1: Regime Flow Chart 4
Figure 2: South Africa, Indicative NPV10/boe, IRR and State Take Comparison, Regional 5
Figure 3: South Africa, Legal Framework 10
Figure 4: South Africa, Institutional Framework 11