Monday July 20, 10:04 AM
Russia abolishes oil export duty for East Siberia
MOSCOW, July 20 (Reuters) - Russia's government last week introduced long-awaited zero export duty -- though only for nine months -- for 13 huge oilfields in Eastern Siberia in a bid to help crisis-stricken oil companies and boost crude production.
Massive reserves of the East Siberia's new generation of fields are seen as a resource base for Russian oil supplies to energy-hungry China.
Russia, the world's second-largest oil exporter after Saudi Arabia, in April brokered a deal to ship 300 million tonnes of oil over 20 years to China by a pipeline starting from 2012.
The Russian government said on its web site, www.government.ru, that the new rate of duty will be activated in two months and will last for 9 months.
'Everyone is happy, no one is hurt,' a source at a Russian oil major told Reuters.
The zero export duty will be applied to Russia's biggest oil company Rosneft's Vankor oil field, which is planned to come onstream later this year, to Surgutneftegas' Talakan as well as to TNK-BP's Verkhnechonsk.
The tax breaks were first proposed at an industry meeting in February.
'I think it's just a test for now. Huge Vankor oilfield is yet to be launched, and now the oil from East Siberia is mainly being delivered to the local market. We believe the effect could be material if the decree is extended beyond nine months,' Pavel Sorokin from UniCredit Securities told Reuters.
Every month the government sets oil and oil products duties, which are based on a monitoring of international prices for Russia's mainstay Urals crude blend.
Russia will raise its oil export duty by 4.4 percent to $222 a tonne from August 1.
(Reoprting by Katya Golubkova and Vladimir Soldatkin; Writing by Vladimir Soldatkin; Editing by Peter Blackburn) Keywords: RUSSIA OIL/DUTY
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