This paper lays the foundation of what Production Sharing Agreements are, what they were intended to be, and how they have failed to meet the current requirements of the State and, in turn, have ended up exploiting the economic resources of the countries by not giving the State their rightful due. Moreover, this paper highlights the consequences of implementing the Production Sharing Agreements in two major oil producing States namely Nigeria and Russia. Subsequently, an earnest attempt has been made to bring to light the flaws of the Production Sharing Agreements accompanied with the inefficiency of the States to amend their respective laws according to their economic requirements.