The process of auditing the recoverable costs of the Pande-Temane Production Sharing area (PSA area) for the period 2017 and 2018 began on June 18, 2019.
The CGE-2019 mentions that the audits found that 50.5 million dollars (34.1% of costs declared as recoverable for 2017) and 49.3 million dollars (43.1% of costs declared as recoverable for 2018) are not eligible for recovery. These amounts, once deducted from the taxable amount, reduce the amount of tax revenue to be collected by the State.
Companies prepare and report to the Government, on a quarterly basis, with information on recoverable costs. This should provide the Government with sufficient time to certify the compliance of costs declared as recoverable within the established timeframe.
However, there is a delay in the government's reaction to certifying the compliance of costs. In the case of Sasol's PES, the government's first report comes 18 years after signing the contract (2002). This fact reinforces the urgency for the installation of the High Authority of Extractive Industry.
