PSC Contracts

Firm commitment should be back-up by bank guarantee (BG)

No Signature/production bonus, equipment and training fund (no front end costs)

10% Royalty will go to Govt and States (Pemda) Export tax - 10% of Profit Oil Excess Profit - 70% of profit price in excess of $25/bbls Research Cess - 0.5% of revenue

Min 15% Carigali participation (pay cash call)

Interests are not cost recoverable

Cost/revenue audited by Petronas Internal Audit only

Different PSC duration for different environment to ensure fair return on investment

1976 1985 DEEPWATER "R/C"

Total Duration 24 24 38 24

Exploration 3+2Gas Holding - 5

5Gas Holding - 5

7Gas Holding - 5

5Gas Holding - 5

Development 2+2 4 6 4

Production 15 15 25 15

PSC Duration (In Years)

Evolution of PSC terms has led to better Contractors’ take

6% 13% 16% 20%26%

26%26%

36%

40%

40%38%

34%

28%21% 20%

10%

1976 PSC 1985 PSC R/C PSC Deep Water PSC

Cost

Government

PETRONAS

PS Contractor

For a 50 MMbbl reserves

EVOLUTION OF PSC- COMPARISON OF CONTRACTORS TAKE