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Thanks Alexandra for this great post! It's interesting to see that this could be the start of a trend. You rightly mention that cost assessments will still weigh in assessment of CIT, but are more contained. On the other hand, of the gross split formula lessens the emphasis on verifying cost structures, which are always difficult and have clearly proved contentious, they set up the need for another area of technical expertise - financial modeling. The Reuters article you link to quotes the deputy minister as saying: ""If you can show us in your analysis and data that the split is not good enough, let's talk." And that's not just at negotiation - the numbers will depend closely in operations on how SKK Migas sets the Indonesian Crude Oil Price - for all revenue streams. The Wood Mack analysis is interesting - seeming to show the government wants to put the companies in a position of cutting costs by 15-20%... but the real need for the government to be able to implement this structure well - at *any* split level either before or after adjustment for all the different factors, is going to be to have their own, solid, financial analysis system... with all the workings. Otherwise they will just have swapped one black box - cost assessments - for another - financial modeling... All the Best Johnny West