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Oil & Gas

Oil and gas exploration in Cyprus is in its infancy.  At the same time there are substantial levels of activity in exploration as well as planning and negotiating for new licenses for future exploration.

In 2008 the first exploratory license and production sharing contract was issued to a US independent energy company and we at Deloitte in Cyprus have been with them since that time, navigating the unchartered waters of Cyprus offshore exploration.  We recognize the challenges that confront energy companies and their suppliers in Cyprus – from the PSC negotiation stage through to production – in relation to the rules and regulations specific to the oil and gas sector as well as the practicalities of applying local legislation and practice to a fluid and international business environment that the local legislation does not always accommodate.

With significant uncertainty in the Cypriot regulatory and tax environment with respect to the fledgling oil and gas sector, there are rapid changes in the market that demand quick thinking. If you want to participate in this great opportunity and be a winner you’ll need to turn these challenges to your advantage and seize the opportunities they create.

Deloitte in Cyprus is your best partner to support and advise you on your Cypriot oil and gas activities.

How we can help you

We work with all companies currently holding a license and PSC for engaging in exploratory activity in Cyprus’s offshore waters. We have been serving the first ever Operator undertaking such exploratory activity, since the very beginning of its establishment in the island. We advise suppliers to the sector, both local and international providers.  We draw on the experience of Deloitte’s global expertise which supports the largest oil and gas companies internationally, delivering a comprehensive range of skills to companies in all segments of the oil and gas industry.

We can draw on our international and domestic experience to help you succeed in this dynamic market by working with you on:

  • Negotiating with the Cypriot Government on important financial terms of the PSC such as clauses on direct & indirect tax, CRS procedures, etc., as well as on an overall “good intentions” clause requiring Ministry support in dealing with other arms of the government.
  • Managing the uncertainty of VAT obligations relating to operating in the Exclusive Economic Zone.
  • Complying with VAT legislation that does not specifically provide for the particularities of oil & gas sector transactions relating to Joint Operating Agreements.
  • Arranging for the free movement and efficient operation of independent contractors servicing the consortium as well as expatriates; requiring timely management of work permit issues, registration and compliance with social security and personal income tax obligations.
  • Ensuring the timely compliance of the Consortium parties with all local regulations/obligations such as tax (corporate & personal), VAT, customs & duties, social security, work permits, payroll, expat obligations, local regulatory & reporting requirements & cost recovery statements.

See our Summary of Value Credentials here.

Contact us for our comprehensive Statement of Credentials.

 

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