The Model PSA provides for TPDC to exercise its participation option, and for APT to be levied, on a Development Area basis. However, it is possible to negotiate an alternative basis as part of the overall economic package. Apart from taxes of a minor nature of general applicability, the oil company is exempted from all other taxes. However, the Model PSA provides an option for TPDC to pay Income Tax on behalf of the oil company if a foreign oil company desires such an arrangement, or for the oil company to be exempted from Income Tax. Petroleum produced from the Contract Area is valued at an average fair international market price which, in the case of arms length sales, is the average realised price.
Expatriates enjoy similar privileges in respect of their personal effects.
Free foreign exchange dealings. In line with Tanzania's earlier agreements, the Model PSA envisages good faith negotiations upon the discovery of gas in order to reach an agreement on its development, production and sale. In appropriate circumstances the Minister will extend the appraisal period. The Oil Company is expected to undertake a training program, employ qualified Tanzanian citizens and give preference to Tanzanian goods and services if available. The oil company may freely assign its rights and obligations to an affiliate providing the performance of the oil company's obligations will not be adversely affected.