What is a revenue sharing contract?
Under a revenue-sharing contract, a retailer pays a supplier a wholesale price for each unit purchased plus a percentage of the revenue the retailer generates. Such contracts have become more prevalent in the video cassette rental industry relative to the more conventional wholesale price contract.
What is the difference between profit sharing and revenue sharing?
While they both involve the distribution of money from the business with certain parties, these two models are actually quite different. Remember that revenue sharing distributes revenue and losses equally among those involved. Profit-sharing, on the other hand, only distributes profits to each party—not total revenue.
What do you mean by production sharing?
A production sharing contract (PSC) is a contractual relationship between a host government and a private sector participant (‘investor’) whereby the government contracts with the investor to carry out oil and gas exploration and production activities (E&P activities) in a defined area for a defined period of time.
What is the difference between PSC and JV?
In JVs agreement, oil and gas operations funds are contributed by JV partners in proportion to their participating interests. While under PSCs, FOCs bear all the risks and costs of exploration and production. Though government participates on commercial discovery.
What is production sharing contract in Nigeria?
Abstract. Production sharing contract (PSC) is an arrangement used in the upstream sector for the exploration and. development of petroleum resources. Several oil producing countries, particularly the developing ones have. adopted it as a contract for the exploration and development of their oil and gas resources.
What is PSC in oil and gas?
Production Sharing Contract (PSC) terms was introduced in 1976. In 1985, new PSC Terms were introduced primarily to attract more foreign investments to explore for oil and gas resources. The 1985 PSC terms offered a better profit split for the contractor.
What was the purpose of revenue sharing?
The purpose of revenue sharing is to allocate to the states and local governments on a permanent basis a portion of the very productive and highly “growth-elastic” receipts of the Federal govern- ment. The bulk of Federal revenues is derived from income taxes, which rise at a faster rate than income as income grows.
What is a drawback of revenue sharing contract?
This is a drawback of coordination through a RSC, which lowers the importance of goodwill and then the relevance of dynamic tools when the player who transfers the share of revenues also contributes to goodwill through advertising.
What is a PSC in oil and gas?
Production sharing agreements (PSAs) or production sharing contracts (PSCs) are a common type of contract signed between a government and a resource extraction company (or group of companies) concerning how much of the resource (usually oil) extracted from the country each will receive.
What is a PSA in oil and gas?
1. Production sharing agreement (PSA) is a contract between one or more investors and the government in which rights to prospection, exploration and extraction of mineral resources from a specific area over a specified period of time are determined.
What is production sharing contract in oil and gas industry?
Production Sharing Contract (PSC) is a contractual arrangement for exploration and production of petroleum resources where the contractor undertakes all the financial, technical and operational risks associated with petroleum operation in return for a share of profit oil after payment of royalty, cost and tax oil.
What is production sharing contract in Malaysia?
The Production Sharing Contract (PSC) continues to evolve since its introduction in 1976 to replace the concession-based system. The PSC fiscal terms today are tailored to match the opportunities offered, providing optimum sharing of the profit oil and profit gas between PETRONAS and investors.
What does PSA mean on oil?
Production-Sharing Agreements (PSAs) are among the most common types of contractual arrangements for petroleum exploration and development.
How is shared production beneficial?
Production Sharing Benefits Are Vast
Reduce overall costs; Provide an important market for a company’s component exports; Retain higher wage jobs, product development and design, capital-intensive manufacturing, and marketing-related activities in the United States; and sometimes.
What are the advantages of revenue sharing?
The primary benefit of a revenue sharing investment is that its structure allows participants to focus on shared success. The goal between management and shareholders are fully aligned towards generating sustainable revenue.
What is the importance of revenue sharing?
Why is revenue sharing important? Revenue sharing keeps stakeholders, shareholders, and investors happy. In fact, some companies implement it to keep their employees happy by using commissions and bonuses.
What does PSA mean in oil?
What is R factor in oil and gas?
The R Factor is cumulative revenues (cost recovery plus profit petroleum) divided by cumulative costs.
What is a PSC oil?
In a production sharing contract (“PSC”) the host country’s government awards to an oil company (or group of companies, typically called the Contractor) the rights to explore in a specified area and following discovery of hydrocarbons in such area the right to produce such discovered resources.
What is a normal PSA level?
The normal range is between 1.0 and 1.5 ng/ml. An abnormal rise: A PSA score may also be considered abnormal if it rises a certain amount in a single year. For example, if your score rises more than 0.35 ng/ml in a single year, your doctor may recommend further testing.
What does PSA measure?
What is the PSA test? Prostate-specific antigen, or PSA, is a protein produced by normal, as well as malignant, cells of the prostate gland. The PSA test measures the level of PSA in the blood. For this test, a blood sample is sent to a laboratory for analysis.
What are three examples of sharing economy?
Examples of the Sharing Economy
- Peer-to-Peer Lending.
- Crowdfunding.
- Apartment/House Renting and Couchsurfing.
- Ridesharing and Carsharing.
- Coworking.
- Reselling and Trading.
- Knowledge and Talent-Sharing.
- Niche Services.
What is an example of a sharing economy company?
Airbnb is a classic example of a global company that makes the Sharing Economy possible. The online platform connects owners who want to make money by renting out an unused room or property to people who are in need of a rented apartment or a house to stay.
How do you account for revenue sharing?
Usually, a 50/50 profit split agreement means, that the profit realized, i.e. 40 – 5 = 35 be split between the two parties. Whichever way you eventually split your income, the payment to the vendor must be debited against sales and credited to the payable account of the vendor.