Following periods of political instability in Cote d’Ivoire, measures have been taken by the government to encourage hydrocarbon investments. However, given the increased interest shown by operators in countries along the Atlantic margin, the potential exists for the government to tighten the fiscal terms.
May 28, 2021
Africa - West
Companies operating in Côte d'Ivoire do so under a relatively simple PSC system, the structure of which includes bonuses, cost oil/gas available for the recovery of operating and capital costs as a fixed % of production, and profit oil/gas divided between the investor and the government on a sliding scale basis linked to either production shares or to an 'R Factor'. Profit share splits are negotiable; negotiated terms vary but generally reflect the level of expenditure and risk involved. Income taxes are paid by the State on the contractors behalf.
Emerging from a decade of political unrest, Côte d’Ivoire is contributing significantly to the economic development of the West African region due to its geographic location, diverse economy, and infrastructure network. Côte d’Ivoire is the largest economy in the West African Economic and Monetary Union – WAEMU (also known by its French acronym, UEMOA) and the third largest in the Economic Community of West Africa States – ECOWAS (also known by its French acronym, CEDEAO) and accounts for more than 30% of the 8-member bloc’s GDP. The economy has benefitted from prudent fiscal policies, monetary stability, rising public spending and structural reforms aimed at improving the business climate and encouraging public-private partnership.
Source: ESRI, Heritage Index, HMG Foreign & Commonwealth Office, US Department of State, International Trade Administration, International Law Review, Ernst & Young, Wood Makenzie & OGA data.
© 2021 Oil & Gas Advisors Limited
Website by Rugby Web Design