Russian State Duma committee approves extending MET concessions for Bazhenov oil reserves by 5 years

MOSCOW. Oct 21 (Interfax) - The Russian State Duma's Budget and Tax Committee approved amendments to the Tax Code on Monday which extend mineral extraction tax (MET) concessions for oil reserves at the Bazhenov formation by five years.

Deputy Prime Minister Alexander Novak previously held a meeting where it was deemed advisable to extend the existing concessions for hard-to-recover reserves in the Bazhenov, Abalak, Khadum and Domanikov formations.

Following the meeting, the Energy Ministry and the relevant companies were asked to draft and submit to the government materials justifying the need to extend the concessions for five years.

According to the text of the proposed amendments seen by Interfax, the measure involves a five-year extension of the MET concession - zero mineral extraction tax due to resetting the price coefficient - for hydrocarbon reserves in Bazhenov pay zones with a depletion rate of more than 1% as of January 1, 2020.