Improvements in progress for Russia`s new PSA law
- LPI Consulting Inc., Washington, DC (United States)
Russian legislation making production sharing agreements (PSAs) fully legal under Russian law passed the upper house of the Russian Parliament (Federal Council) on December 19, 1995, was signed into law by President Boris Yeltsin on December 31, 1995, and took effect on January 11, 1996. While PSA legislation remains the central legal basis for large scale investment in the Russian petroleum sector, company views towards investment in this sector are tied to much more than the extent of legal guarantees. Investor attitudes are also shaped by expectations regarding political stability, behavior of Russian regulatory authorities, and prospects for the Russian economy. Furthermore, Western investors in the petroleum sector have some experience in dealing with the Russian government and existing frameworks for investment, particularly the joint venture (JV) deals with Russian entities and the often changing regulatory and tax treatment of these ventures. It is the view of the authors that attitudes among some Western companies in Russia on the political and economic environment may be too pessimistic and shaped more by press reports than actual conditions. News reports on violence, political instability, and a disastrous economy are not entirely borne out by the facts. Russian, of course, faces serious political and economic problems which must be carefully evaluated, but the overall outlook is much more complex, and some positive developments are underway. This paper reviews the economic, oil production and industry outlook as a result of the PSA law.
- OSTI ID:
- 211896
- Journal Information:
- Oil and Gas Journal, Journal Name: Oil and Gas Journal Journal Issue: 13 Vol. 94; ISSN 0030-1388; ISSN OIGJAV
- Country of Publication:
- United States
- Language:
- English
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