What is a Signature Bonus?

Answer 1

The signature bonus system is common in many oil-producing countries. A payment is made up front to the host country for the right to develop a block commercially before work begins. This system is a widely recognised and legally accepted way for an oil company to secure the right to explore a certain field or block. It is also important to note that paying a signature bonus for a licence does not necessarily imply future revenues for the company from oil production in the same licence.