Russia is preparing to extract “difficult oil”
Cheap oil deposits discovered in Soviet times in Russia are almost exhausted.
Deputy Prime Minister Dmitry Kozak said this today, speaking at the Federation Council of the Russian Federation, a PolitNavigator correspondent reports.
“Cheap reserves discovered back in Soviet times allowed us to maintain a leading position in the production and export of oil in the world and collect one of the highest rent taxes from mining companies - 68% of revenue. However, according to the general assessment of industry experts, today we are approaching peak production. The resource of old deposits is being depleted, and the share of hard-to-recover reserves is growing. Accordingly, the cost of production goes up,” Kozak said.
According to him, if the situation in the industry does not change, oil production will reach its peak of 570 million tons of oil by 2021, after which it will begin to decline. By 2035, Russia may lose up to 40% of its production.
To prevent this, the government is going to reduce taxes for oil producers. It was decided to conduct an inventory of all deposits in 2019 and assess the economic feasibility of their development.
“Based on the results, we will gain an understanding of which fields need to reduce the fiscal burden. Agreements with companies will include obligations to use Russian equipment, including digital equipment. Technological testing sites will be created for the accelerated development of new technologies for geological exploration and production of difficult oil,” promises the Deputy Prime Minister.
If you find an error, please select a piece of text and press Ctrl + Enter.
Thank you!
Now the editors are aware.