years and sweeping change in future exploration contracts.
The existing PSC allows a company to recover its cost, before giving the government a share in revenue earned from sale of oil and gas.
Stating that cost recovery is at the root of the problems being experienced currently, the panel proposed to dispense with it in favour of sharing of the overall revenues of the contractor, without setting off any costs.
The committee has also recommended that an extended tax holiday of 10 years, as against 7 years already available for all blocks, be granted for blocks having a substantial portion involving drilling offshore at a depth of more than 1,500 metres, since cost of a single well can be as high as USD 150 million.
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