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Russia Plans On Renewed East Siberia Oil Export Duty

Russia Plans On Renewed East Siberia Oil Export Duty
dj
Τρι, 15 Ιουνίου 2010 - 17:47
Russia's government has decided to partially reinstate an export duty on crude oil produced in East Siberia starting July 1 in order to release more funds for the federal budget, a government official said Tuesday.
Russia 's government has decided to partially reinstate an export duty on crude oil produced in East Siberia starting July 1 in order to release more funds for the federal budget, a government official said Tuesday.

The government canceled the export duty at 22 East Siberian oil fields--including the huge Vankor field developed by state oil company OAO Rosneft (ROSN.RS)--from the beginning of 2010 to stimulate investment in the oil-rich, but largely undeveloped, region.

In January, however, Russian Finance Minister Alexei Kudrin proposed reversing the decision, saying the exemption would hurt the federal budget more than previously anticipated. The export duty will be reinstated on July 1 at a rate lower than the normal rate, the government official said, but declined to be more specific.

A spokesman for Prime Minister Vladimir Putin said a government working group is still reviewing the proposal.

"The decision will be made public in coming days," said spokesman Dmitry Peskov. "It is still in the working process."

Russian Deputy Finance Minister Sergey Shatalov said earlier this month the government was discussing a reduced export duty of 45% of the standard duty, and that reduced rate could be calculated on the share of the oil price above $50 a barrel. Analysts have said canceling the tax break would have a negative effect on Rosneft's and other companies' plans to develop East Siberia . Alfa Bank calculated that Rosneft may lose $500 million this year from the early introduction of export duties and $4 billion next year, assuming an oil price of $75 a barrel.

Rosneft's share price more than doubled in 2009, but the stock has slipped more than 26% since reaching a year high on January 11, as the finance ministry suggested canceling an export-duty exemption. At 1218 GMT, the stock was trading 1.0% higher at $6.90 in London .

Russia --the world's biggest oil producer--last year increased output to more than 10 million barrels of oil a day, thanks largely to Rosneft, TNK-BP Ltd. and OAO Surgutneftegaz (SNGS.RS) launching new East Siberian fields. Production fell in West Siberia, Russia's traditional oil region, as fields matured.
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