Russia Ministry of Energy: Pavel Sorokin: “Our task is to adjust the system so that it attracts investments for a greater multiplier effect”

Thanks to the stimulation of oil production at fields in Russia, the Russian economy over the past 15 years has managed to attract about 8.5 trillion rubles of investments, as well as to increase oil production by about 1 billion tons, said Pavel Sorokin as part of his speech at the session of the Moscow Financial Forum “Efficiency of preferential tax regimes: directions of movement ”. He stressed that in this way, the benefits provided to business have shown significant efficiency.

According to the deputy minister, today, in one form or another, up to 50% of all oil production in Russia falls under the privileges.

“The extra booty that was generated by the incentives created more than outweighs the money spent. For some projects, in particular those developed, we managed to reverse the trend from a decrease to an increase in production – this also shows that the benefits have achieved their effect, ”he said.

The state gradually switched from production to stimulating oil refining. So, the introduction in 2020 of a reverse excise tax on ethane, liquefied petroleum gases, a special investment coefficient, as well as stimulating the modernization of refineries led to the signing of new agreements with oil companies for a total of 1.5 trillion rubles, which will be invested in the processing industry, Pavel Sorokin continued. This, in turn, will give an additional 3.5-4 million tons of gasoline and about 10 million tons of diesel in the period until 2026, he said.

“Today the fuel and energy complex accounts for up to 20-25% of the country’s total GDP. Despite the fact that the fuel and energy complex is the recipient of incentives, it pays for it with interest and directs investments indirectly to other sectors. Our task is to adjust the system so that it attracts investments for a greater multiplier effect and creates an opportunity to use these benefits regardless of any energy transitions, ”concluded the Deputy Minister.