Russia Mulls Ending Export Duty Cut for More East Siberian Fields

Russia is considering ending the export duty reduction for crude from the East Siberian Verkhnechonsk and Talakan fields in 2011, a source in the finance ministry said.

The move follows a recent decision to halt the reduced tax rate for the neighboring Vankor field due to high oil prices, and highlights the unreliability of tax benefits based on a project-by-project basis.

The three fields are the main sources for the ESPO blend, which Russia sends mainly to Asian markets via its new East Siberia-Pacific Ocean pipeline.

The Russian government planned initially to levy the regular export duty for crude produced at Rosneft's Vankor field in East Siberia from January 2011, and at TNK-BP's Verkhnechonsk and Surgutneftegaz' Talakan from January 2012 and January 2013, respectively.