Common use of Interaction of cost recovery fee and remuneration fee Clause in Contracts

Interaction of cost recovery fee and remuneration fee. The cost-recovery fee and remuneration fee will also typically be subject to caps on the total amount that can be paid in a billing cycle. Amounts owed to the IOC above the cap may be carried over to the next billing cycle. The cap on the payment of fees is linked to overall production of the project. Generally, the service contract will also provide that the cost-recovery fee is to be paid in priority to the remuneration fee.