Terms of Production Sharing Contracts in International Oil and Gas Cooperation and China’s Optimization Path

A production sharing contract refers to an international oil and gas cooperation agreement where the resource country retains ownership of the oil and gas resources, while foreign oil companies develop and produce these resources, with the resulting oil and gas products subject to cost recovery and profit sharing. The production sharing contract has become one of the most widely used contract models by oil and gas resource countries worldwide. In recent years, China has also actively adopted production sharing contracts for cooperative development of international oil and gas resources, playing a crucial role in optimizing the energy structure and ensuring energy security and addressing global energy chanllenges. The fiscal and tax provisions, stability clauses, and legal provisions of the production sharing contract are crucial for managing risks, controls, and profit-sharing arrangements during the exploration, development, and production of oil and gas resources between resource countries and foreign oil companies. China should enhance the information support for the formulation of fiscal and tax provisions, stabilize clauses appropriately to mitigate sovereign risks, and establish a dynamic and flexible contract communication and coordination mechanism.

Keywords: International Oil and Gas Cooperation, Production Sharing Contract, Fiscal and Tax Provisions, Stability Clause, Legal Provisions.