New Arctic law could bring 5 new oil projects right away


New Arctic law could bring 5 new oil projects right away

Until the end of 2019, it’s planned to introduce a law on a special economic regime for the Arctic into the Duma. For Russia, this may mean at least 5 new oil projects.

According to the Minister for the Development of the Far East and the Arctic, Alexander Kozlov, the creation of a special economic regime in the Arctic will allow launching at least 5 projects for oil production on the Arctic continental shelf. This can bring more than 800 billion rubles in total tax revenues.

The new bill provides for the application of the paragraph on tax non-degradation for all investors in the Arctic zone. In addition, additional benefits will be available to residents: reducing the time for cargo execution and the regime of a free customs zone. Tax preferences are also provided, in particular, income tax will amount to 7% for the entire duration of the project.

Kozlov notes that all projects will be divided by type, each of them will have its own benefits. This should encourage the development of the Arctic continental shelf. According to the minister, only one oil production project has been implemented - the Prirazlomnoye field and more than 60 licenses have been issued for geological exploration. The new bill has already been agreed and will be submitted to the State Duma before the end of this year and will enter into force in 2020.

The mechanism for investor support in the Arctic is similar to the mechanism for the Free Port of Vladivostok. It is assumed that in the Arctic zone, thanks to the macroregion support mechanism, a significant economic growth will also occur.

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