OREANDA-NEWS. February 25, 2010. Speaking to journalists, Russian Energy Minister Sergey Shmatko referred to an export duty exemption provided to 22 selected oil fields as a “long-term measure necessary to stimulate investments” in Eastern Siberia, reported the press-centre of OTKRITIE Financial Corporation.

He indicated that the government could “work out more detailed instruments as part of the long-term policy” in the near future, although he made clear that potential modifications would not change the nature of the tax break, which is aimed at boosting investments in Eastern Siberia. “Our policy … is directed and being implemented with a view to setting zero export duties”, said Minister Shmatko.  

View: We believe that the export duty relief is likely to stay in place for quite some time, although its application rules could be slightly modified in the future. Specifically, as Minister Shmatko mentioned, the government might differentiate the export duty relief depending on the production potential of the specific field. Given that no further details have been provided at this stage, we view the news as neutral for those companies affected to the export duty exemption (Rosneft, TNK-BP, and Surgutneftegaz).