📋 Tender Overview
At a meeting on Monday, the State Duma Committee on Budget and Taxes approved amendments to the Tax Code that extend for 5 years the mineral extraction tax (MET) benefits for hard-to-recover Bazhenov oil deposits.
"This is a 5-year extension of the benefit for Bazhenov productive deposits," Deputy Finance Minister Alexey Sazanov explained during the discussion of the amendment.
“That is, stimulation of hard-to-recover reserves,” clarified the head of the committee, Andrei Makarov.
In addition, the committee approved amendments to the tax code that extend the mineral extraction tax benefit for the Vladimir Filanovsky deposit, which is being developed by Lukoil, for 5 years.
"The special tax regime for extraction at Caspian fields is being extended for 5 years. ... Since this benefit is already in effect, in order to provide additional budget revenues, it is proposed to set the corporate income tax rate for such fields at 34% for the extension period," Sazanov noted at the meeting.
Hard-to-recover reserves (HTR) are reserves of deposits, pools or their individual parts that are characterized by relatively unfavorable geological conditions for oil extraction or its physical properties. Profitable development of such reserves is possible using methods and technologies that require increased capital investment and operating costs.
The share of hard-to-recover oil reserves in the Russian Federation, according to Rosnedra, is about 60-65% of the total volume of reserves. Deputy Prime Minister Alexander Novak reported last year that the share of hard-to-recover oil production in the country could increase from the current 30% (166 million tons per year) to 70% by 2050. He also noted that the government does not rule out introducing additional benefits for hard-to-recover reserves.
