This is the first of two installments which address a number of related royalty issues: the underlying reason for the current wave of royalty litigation, a legal history of the meaning of royalty, and whether lessees must pay royalty on any value added to production by "post-production" activities under the provisions of common gas royalty clauses. The second installment, entitled "Royalty Valuation: Should Courts Contemplate the Forests or Dissect Each Tree?" will appear in the fall/winter issue of the Journal.

Royalty Valuation: Should Royalty Obligations Be Determined Intrinsically, Theoretically, or Realistically? Why All the Fuss? What Does History Reveal? Anderson, Owen L., Summer 1998, pp. 1‑29.

Environmental laws and standards may result in costs which are—on either a company or industry basis—absolutely staggering. Accounting for current and estimated future dismantlement, restoration, and environmental reclamation costs raises issues which have perplexed accountants in the industry for decades. The objectives of this paper are to review some of the most prominent U.S. environmental legislation affecting the oil and gas industry, to discuss relevant accounting standards and concepts, and to examine the latest events in the evolution of standards for financial accounting and reporting of current and future environmental costs.

Environmental Accounting in the Oil and Gas Industry. Wright, Charlotte, Summer 1998, pp. 30‑49.

The international petroleum industry offers substantial rewards and equally substantial challenges. Overseas exploration, production, and development potential is dramatically better than US prospects. The key differences lie in the geopotential and in negotiating the fiscal terms of a production sharing contract.

Trends and Issues in Foreign PSCs. Johnston, Daniel, Summer 1998, pp. 50‑61.

To succeed in the global oil and gas industry, US oil companies must consider the dual impact of US and foreign tax regimes on their investment opportunities and select projects that maximize revenues—given the project's geological and economic constraints—and offset or minimize the net effect of the two taxing authorities.

U.S. Tax Impact of Foreign Petroleum Taxation. Mangano, Cliff, Summer 1998, pp. 62‑91.

In June 1997, the FASB issued the first proposed concepts statement in 12 years: Using Cash Flow Information in Accounting Measurements. This could be an indication that the Board is now ready to consider nontraditional measurement methods, specifically the concept of expected cash flows. This article focuses on how this proposed concept would affect the oil and gas industry.

The Potential Effect of the FASB's Proposed Concepts Statement on Cash Flow Measurements on the Oil and Gas Industry. Nichols, Linda, Summer 1998, pp. 92‑100.

This article is a response to a recent article by Ken Pratt, "Accounting for the Value of Discovered Reserves of Oil and Gas: Responses to a UK Discussion Paper," (Petroleum Accounting and Financial Management Journal, Spring 1998). It reflects on how recent research helps answer some of the questions raised in Professor Pratt's paper.

The Information Value of Disclosures of Unproved Reserves: A Research Note. Boone, Jeff; Luther, Robert; and Raman, Kris, Summer 1998, pp. 101‑104.

FASB activity includes the release of FAS 133, Accounting for Derivative Instruments and Hedging Activities; the coming Euro conversion; and accounting for Year 2000 modification costs. At the request of the AICPA , the SEC is considering an amendment clarifying improper professional conduct . The ASB's new interpretation of AU Section 341 addresses the impact of Year 2000 problems on an entity's ability to continue as a going concern.

Current Developments in Financial Accounting and Reporting. Jennings, Dennis R., Summer 1998, pp. 105‑115.

A report on the activities of the Council of Petroleum Societies' various committees.

COPAS: An Update. Gear, Jon, Summer 1998, pp. 116‑133.

The topic of this issue's column is a recent exposure draft from the FASB which addresses FAS 121, Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of.

Current Developments in Environmental Issues. Wright, Charlotte, Summer 1998, pp. 134‑137.