Upstream O&G activities are reserved to the National Oil Company. Private participation is possible only through a joint-venture or production sharing arrangement with the national oil company. Foreign-owned companies, however, face restrictions in accessing local financing from banks etc for financing their local operational needs. Since 2019, however, the Government has decided to suspend all oil promotion. To date, thenafter, there has not been any official statement regarding new contracts or contract renewals.
"Art.6- For the purposes of this Code, the following terms mean:
 - "upstream activities", all operations of prospecting, research, exploration, exploitation, transformation and transport of liquid, solid or gaseous hydrocarbons produced;
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Art.13- Any type of contract commonly used in the international oil industry may be adopted to set the rights and obligations relating to "UPSTREAM" activities in the national mining domain, in particular that of production sharing and association in joint venture.
As needed, the national company with the agreement of the Technical Body can conclude a production sharing contract with oil companies. In this case, the National Company may transfer to its co-contractor all or part of its rights and obligations relating to a mining title it holds.
Within the framework of a joint-venture association, the contract will be signed between the oil companies and the National Company.
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Art.40- In the exploration phase, contracting companies of foreign origin are required to domicile in a bank in Madagascar from foreign capital the funds necessary to cover all of their local needs.
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Art.42- From the start of exploitation of any hydrocarbon deposit declared of commercial interest within the framework of a contract, the contracting companies of foreign origin may hold outside the sales revenue from the their share of hydrocarbons.
However, the said companies are required to domicile in a bank in Madagascar, from foreign capital, the funds necessary to cover all of its local needs.
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Art.44- Contracting companies of foreign origin shall not have the right to resort either to credit from Malagasy banks or to pledges or to loans between companies or enterprises operating in Madagascar, to cover their local needs referred to in Articles 40 and 42 above. [...]" (LAW N 96-018 of September 23, 1996 bearing the PETROLEUM CODE [google translation])
LAW N 96-018 of September 23, 1996 bearing the PETROLEUM CODE [google translation]
[<a href="https://www.omnis.mg/images/documents/CodPetFr.pdf">Law</a>]