LUKOIL sees $1.5 bln savings from mineral tax cut
LONDON, April 10 |
LONDON, April 10 (Reuters) - LUKOIL (LKOH.MM), Russia's second-largest oil producer, expects $1.5 billion in annual savings from a proposed cut in the country's mineral extraction tax, the company's vice-president said on Thursday.
Leonid Fedun said the proposed reduction in a tax blamed by producers for slowing oil output would also hasten the development from 2010 of new fields, which are currently being delayed by high costs.
"It would mean we could hasten the launch of delayed projects," Fedun told Reuters on the sidelines of an investor presentation in London, naming the North Caspian as a key region where projects could be brought forward.
Russia's oil industry is set to win much-sought tax relief from 2009, gaining over $4 billion to support flagging output growth, when the country raises the non-taxable threshold on its oil production to $15 per barrel from $9. Fedun said the lighter tax burden would hasten production growth only after 2010, when the bulk of the tax cuts come into effect.
The raft of proposals include a two-stage reduction in the mineral extraction tax to encourage investment in production assets, excise tax cuts and breaks on clean fuels production.
"These tax innovations would give us $1.5 billion in savings," Fedun told investors. (Reporting by Melissa Akin; Editing by Margaret Orgill)
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