Fin ministry fears precedent set by tax incentives for Samotlor

MOSCOW, Oct 5 (PRIME) -- Russia’s Finance Ministry fears that mineral extraction tax (MET) incentives for Rosneft’s Samotlor oil field alone will create a very dangerous precedent, Alexei Sazanov, head of the ministry’s tax and custom tariff policy department, told reporters on Wednesday.

“If we introduce it for Samotlor alone…it will create a very dangerous precedent that will establish a small bubble at first, and then it will transform into a lot of small and large bubbles. We cannot allow this to happen. We are not preparing a decreasing coefficient for MET,” he said.

The Energy Ministry earlier proposed to provide MET incentives for watered fields with a combined output of around 35 million tonnes of oil per year and submitted a draft bill to the government. The incentives could be provided to four large watered fields operated by Lukoil, Gazprom Neft, Rosneft, and Surgutneftegas.

But on Wednesday, First Deputy Energy Minister Alexei Teskler said that the ministry will most likely introduce tax incentives for watered fields gradually, with Samotlor being the first to receive it.

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