Research On Russia's Energy Investment Product Sharing Agreement

Under the current world circumstances,the energy issue has increasingly become a core issue concerning the development of all countries in the world,and the investment and cooperation in the international energy field has drawn more and more attention-As a kind of model of energy investment contract which can reasonably balance the interests and risks between energy countries and foreign investors,production sharing agreement has gradually become the mainstream model of international energy investment contract nowadays since the first production sharing contract was implemented in Indonesia in 1966.In order to revitalize the on and gas industry as its pillar industry and attract the foreign investment,Russia issued the "Production Sharing Agreement Law" in the 1990s,which marked the formal establishment of such energy investment model in Russia and provided a favorable new way for foreign investors to invest in Russian oil and gas exploration.However,with the intensifying awareness of "Energy Sovereignty" in major energy countries worldwide including Russia and the rise of the wave of energy nationalization in recent years,Russia has also made multiple amendments to "Production Sharing Agreement Law" as well as other supporting laws and regulations to strengthen the protection of its own interests.As a whole,though,production sharing agreement has remained a more practical and favorable way to invest in Russian oil and gas in comparison with traditional mining tax system.Frol the perspective of the international situation,geopolitics and the complementarity of oil and gas field,the deepening Sino-Russian energy cooperation has become an inevitable trend so far.Nonetheless,Chinese enterprises have never exploited the oil and gas in Russia with production sharing agreement before,so it has become a practical problem for Chinese enterprises to fully understand and grasp the production sharing agreement as a investment model.The paper elaborates on the background and legislative development of the "Production Sharing Agreement Law"of Russia,and expounds the general characteristics of the production sharing agreement of Russia.On this basis,three key issues that are closely related to the interests of investors in the implementation process of this mode are selected for specific research and analysis,namely sharing mode and corresponding tax system,stabilization clause and investment dispute settlement mechanism.To date,the Russian production sharing agreement can be divided into direct sharing mode and indirect sharing mode,corresponding to their respective tax systems.Therefore,understanding the different characteristics of the two sharing modes will be conducive to making a reasonable choice.The stabilization clause belongs to the safeguard and relief clauses in the contract.Despite that such clauses have been stipulated in the"Production Sharing Agreement Law" of Russia,there are still some exceptions and notable points.The paper discusses the types and functions of the stabilization clause and analyzes its advantages and disadvantages in die application process.The dispute settlement mechanism is the last barrier for the rights and interests of investors.Different dispute settlement mechanisms that can be applied to the production sharing agreement in Russia are comparatively analyzed in the paper in accordance with the actuality of Russia.The Sino-Russian energy cooperation has great potential,and the in-depth understanding and active application of the investment model of production sharing agreement is beneficial to the protection of China's energy supply,which also echoes the implementation of the strategic blueprint of "The Belt and Road".Through the discussion and analysis of the above issues in the paper,it is hoped to serve as a reference for the further study on the legal issues on production sharing agreement of Russia in the future.