Page 18 - FSUOGM Week 28 2020

FSUOGM
NEWS IN BRIEF
FSUOGM
RUSSIA
Russian finance ministry
mulls changes to proft-
based tax system
Russia’s nance ministry has proposed changes to the excess pro t tax (EPT) system that was applied at certain oil elds last year, Russian business daily Izvestiya reported on July 14.
e move comes a er the ministry revealed last month that the switch to the EPT system had cost the Russian budget some RUB213bn ($3.05bn) in lost tax receipts. e ministry has drawn up a bill that aims to compensate these losses.
In the dra law, the ministry proposes
to increase the coe cient for mineral extraction tax (MET) in the EPT system
by 50% by the end of 2023, and then
reverse the change. is mechanism will apply to deposits in the middle of their development cycle, according to Izvestiya, and will also restrict a taxable income cut by losses a revise the reserve estimates for the calculation of incentives.
Workers break into office of Gazprom's Amur gas plant
About 300 workers broke into the o ce of Gazprom's Amur Gas Re nery late on July 13, and Chairman of the Investigative Committee Alexander Bastrykin ordered the authority to report on the incident.
"Alexander Bastrykin ordered to report on the circumstances of the accident
on the building site of the gas refining complex in the Amur Region, where a conflict occurred between the workers
of the contractor and its executives," the statement read.
A criminal case was initiated a er the incident. e Investigative Committee started a check on wage non-payment reported by media.
Mulled EU carbon tax could cost Russia €33bn
e new carbon tax border levy on imported goods being considered currently by the European Union for 2025 could cost Russian exporters €33bn between 2025 and 2030, KPMG warned the lobbying group Russian Union of Industrialists and Entrepreneurs (RSPP), RBC business daily reports.
Should the EU adopt a stricter carbon tax regime, charging fees based on both direct and indirect emissions, Russian companies could have to pay €51bn by 2030, KPMG estimates.
RBC reminds that Europe is Russia’s single largest export market, with €143bn worth of exports in 2019, out which
two thirds were oil and gas. Analysts commented that Russian businesses are forced to regard cross-border carbon taxation and sustainable policies as necessary to maintain their market shares.
bne IntelliNews closely follows how Russian companies are keen to improve their environmental, social and governance (ESG) scores, as it is a ecting their share price.
According to the study by the Organisation of Economic Cooperation and Development (OECD), Russia is the leader on economic damage from air pollution in terms of GDP, with an estimated $447.6bn in losses, or 12.5% of GDP, in 2015.
e latest Emissions Gap Report 2019 by the UN Environment Programme (UNEP) generally saw few concrete steps in Russia towards emissions cutting, despite the recent rati cation of the Paris Agreement, which bne IntelliNews covered in a feature “the Cost of Carbon in Russia.”
e World Bank also argued last
year that carbon footprint is one of the impediments to Russia's long-term growth.
Novatek reports on H1 output
Russia's Novatek saw a 2.2% year-on-year decline in gas output in the second quarter, it said on July 13.
e company extraced 18.5bn cubic metres of gas in the three-month period,
versus 18.9 bcm a year earlier. Its liquids output fall 3.8% at 2.92mn tonnes, bringing overall hydrocarbon production to 1.6mn barrels of oil equivalent per day, down 2.5%.
Gas output in the rst half was unchanged y/y at 37.58 bcm, while liquids production was down 0.9% at 5.97mn tonnes.
CENTRAL ASIA & SOUTH CAUCASUS
Kazakh industrial output
up by 3.1% y/y in January-
June as oil production rises
1.6% y/y
Kazakhstan's industrial output rose by 3.1% y/y in the rst half of 2020, according to latest gures released by the country's State Statistics Committee.
Growth was mainly supported by a rise in the Central Asian country’s oil sector, which expanded by 1.6% y/y to 44.9mn tonnes in the period. Ore mining fell by 14.1% to 51.8mn tonnes in January-June. Oil production this year was originally expected to stay unchanged from last
year, but this planned trajectory will likely change due to Kazakhstan’s commitments to cut production, made as part of the OPEC+ agreement as world oil prices began to collapse. e ongoing coronavirus (COVID-19) outbreak coupled with low world oil prices is likely to substantially a ect Kazakhstan’s economic performance and industrial output this year.
Electricity generation rose by 2% to 53.6bn kWh, the gures showed.
Portland cement output registered a 3.4% y/y increase to 4.8mn tonnes in the period.
Petrol production jumped 7.1% y/y
to 2.1mn tonnes — much of this rise in output was thanks to the completion of modernisation works at re neries last year.
Flour output stood at 1.7mn tonnes, marking a 7.9% annual rise from January- June 2019.
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Week 28 15•July•2020