0.625
%
Positive
62
mm boe
0
%
Paraguay remains significantly underexplored, partly owing to the difficulty international operators have had in establishing operations. Its investment-grade rating and moves to make the oil and gas environment more transparent support our view. Outlook maintained because macroeconomic stability and transparency continue to improve. Outlook: Positive. Risk premia unchanged at 0.625%.
October 7, 2026
Americas - South
mm bbl
bcf
Central South America, northeast of Argentina, southwest of Brazil.
Concession
Paraguay operates a sliding scale royalty that starts at 10% and increases to 14% at 50m bpd; the gas royalty is flat at 12%. Profits are taxed at 30%, some 20% above the prevailing general corporate tax rate. Depreciation rates are 25%.
President Santiago Peña's Colorado Party government is stable, and Paraguay gained an investment-grade rating from Moody's in 2024; it remains one of the few countries that recognise Taiwan. US and UK guidance cite low taxes and macroeconomic stability, but note corruption, organised crime and weak courts. Paraguay has no hydrocarbon production; it is a large exporter of hydropower from Itaipú and Yacyretá, and the renegotiation of Itaipú's tariff terms with Brazil is under way.
Source: ESRI, Heritage Index, HMG Foreign & Commonwealth Office, US Department of State, International Trade Administration, International Law Review, Ernst & Young, Wood Makenzie & OGA data.
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