Category: Oil and Gas business

The ideal method of taxation is one based on resource rent tax which includes also any windfall profit. This progressive tax levied on profits is implemented around the world in two main ways: the R-Factor (The R-Factor is the ratio of cumulative revenue to cumulative expenditure)in which the entrepreneur starts paying a special tax only after having paid his expenses and the ROR rate of return based on his return on investment in the project and is thus implemented when the rate of his return on investment (IRR) has been achieved. However, because this tax is a progressive tax it is linked to the price of the resource that is produced so that the government take increases if the price obtained by the entrepreneur increases also.

The Rate of Return (ROR) method is calculated based on the rate of return on the investment and thus takes into consideration the time value of the money and implements it after the internal rate of return (IRR) has been obtained.

Progressive regimes are based on the premise of taxing a project according to its ability to pay – i.e. an increasing amount should be paid to the state in taxes as its profitability increases. A number of fiscal regimes, therefore, contain fiscal mechanisms (such as production sharing or additional profits taxes) which provide the state with a higher percentage of the economic rent based on a sliding scale, linked to some measure of field performance. Regimes which utilise field profitability as the measure of field performance, such as an “R factor” or IRR, are normally progressive, particularly if the taxable base allows early cost recovery and the rate is levied on cashflow rather than gross revenue.

RRR is similar to PRRT (Petroleum Resource Tax)except for the fact that only exploration expenses for the year prior to the start of the RRR can be deducted and not any expenses incurred prior to this.

Globe Exploration is a partnership that was set up in 2009 and is controlled by Yaacov and Margaret Hai, Baruch and Derin and Menachem Sternberg with the objective to deal in oil and gas exploration, and which holds rights in two onshore licenses, “Ofek” in the center of Israel that extends over 393 sq km and the “Bar-Or” license in the Western Galilee and license “Yahel” in the Haifa Bay

Israeli Solar company MST has connected its first system to the national power grid to produce 50 KW of electricity making it the first Israeli firm in the field. MST was founded in 2002 by Dov Raviv, commonly known as the father of the Arrow antiballistic missile. Its concentrated photovoltaic (CPV) system uses mirrors that move with the sun to concentrate its rays on solar panels, thus boosting their efficiency and MST says they have reached 24.5% overall efficiency during almost a year of testing, which is about 10-12% more than standard CPV panels. The idea behind CPV is to use less land than PV and achieve higher efficiency. MST also says that its system is on trackers that are raised above the ground and so the land below can be used for agricultural production

Bringing a wild well (a well that is out of control) back in control