Library / Implementation Guidelines for the Oil and Gas Companies (Tax Incentives, Exemption, Remission, etc.) Order, 2024.

Implementation Guidelines for the Oil and Gas Companies (Tax Incentives, Exemption, Remission, etc.) Order, 2024.

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Suggested. Solution to illustration 
E: 
. 
, 
ad 
Rg 
a 
aan 
gy 
* 
: 
EF 
‘ 
, 
# ae 
XYZ Energies Limited: 
, 
f ] 
“7, 
go 
Computation of Gas Tax Allowance‘cjaimable in ‘thectelevantaccounting period. 
evn apecll 
é 
Ty 
3 
: 
: 
eau 
Volume of gas produced 
= 200,000,000 Mecr 
bowtie 
ery 
Price per MSCF= US$5.00 
sD. 
pe 
Gas Tax Allowance (GTA) Rate: 
7; 
wien? 
ad ie 
44% 
Lower of: 
(a) US$0.5 and; 
(b) 30% of US$5.00 = US$1.5 
Applicable GTA rate = US$0.5 
Gas Tax Allowance Claimable = Production per MSCF x Gas Tax Allowance Rate 
. 
» 
(200,000,000/1000) x US$0.5 
. 
* 
200,000 X US$0.5 
. 
- 
= 
. US$100,000 
ok 
Pe 
st 
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B 
— 
* 
s 
pn 
a 
IlustrationE 
, 
~ 
bes 
» "er 
ABC 
Energies Limited 
operates: a NAG 
field 
and commenced 
its 
first Gas 
production on {st April 2024. The NAG ‘field contains HCL of 25 barrels per million 
SCF of gas. Assuming the Company produced a 
total of 100,000,000 MSCF for 
the year, with a fiscal gas price of 
$3.00 per MSCF. 
Compute tax due after giving effect to the Gas Tax Credit claimable for 2024 
accounting period assuming total profit of the company is US$500,000 
Suggested Solution to illustration F: 
ABC Energies Limited: 
Computation of Gas Tax Credit claimable in 2024 accounting period. 
Volume of gas produced = 100,000,000 MSCF 
Price per MSCF 
=US$3.00 
Gas Tax Credit (GTC) Rate: 
* 
a 
Lower of: 
, 
a 
(a) US$1.00 and; 
, 
~ 
oF 
(b) 30% of US$3.00 = US$0.9 
;