Common use of Interest Recovery Clause in Contracts

Interest Recovery. Subject to and in accordance with the Hydrocarbons Law, any interest on loans obtained by the Contractor from Affiliated Companies shall not be recoverable as a Petroleum Operations Cost, nor shall it be deductible for tax purposes when estimating any Income Tax liabilities of the Contractor. Any interest on loans obtained by the Contractor from Persons other than Affiliated Companies for investments in Petroleum Operations shall not be recoverable as a Petroleum Operations Cost but shall be deductible for tax purposes, when estimating any Income Tax liabilities of the Contractor provided that the rate of interest and the terms of repayment have been approved by the Ministry in advance.